by Marion Nestle
Sep 4 2012

Some reflections on Labor Day, 2012

Economists tell us that we are in a recovery period.  Jobs, yes.  But money?  No.

According to the report in the New York Times, the employment statistics reflect substantial increases in low-wage jobs but losses in better paying jobs.

Lower-wage occupations, with median hourly wages of $7.69 to $13.83, accounted for 21 percent of job losses during the retraction. Since employment started expanding, they have accounted for 58 percent of all job growth.

The occupations with the fastest growth were retail sales (at a median wage of $10.97 an hour) and food preparation workers ($9.04 an hour). Each category has grown by more than 300,000 workers since June 2009.

Need a job?  Head for the kitchen.

But be careful.  According to another New York Times report, a new study finds that:

Low-wage workers are routinely denied proper overtime pay and are often paid less than the minimum wage…Of workers who receive tips, 12 percent said their employer had stolen some of the tips.

Wouldn’t unions help?  They might, but take a look at the Ithaca Journal’s analysis of union membership.  New York, it seems leads the nation in the percentage of its workers who belong to labor unions: 24.1% in 2011.

But, this percentage:

glosses over the fact that while union representation has increased in the state’s public sector, it has fallen off dramatically in the private sector.

Last year, according to the unionstats.com website, 72.2 percent of the state’s public work force was unionized…But in the private sector, the unionization rate last year was 13.5 percent.

The easy answer for the decline in the private sector, analysts say, is the state’s loss of job slots in the manufacturing sector — 908,400 in 1991 to 458,000 in 2011 — which has long been organized labor’s bread and butter.

But there are other reasons for the resistance to private sector unionization:

Part is based on employers’ imagined need to increase their profitability and part has to do with a tremendous growth in law firms and consultants that specialize in breaking private unions.

No wonder more than 46 million Americans qualify for and receive SNAP (food stamp) benefits.

The food service industry exists on low-wage jobs.  Such jobs should be entry-level, not permanent.  They are not a solution to America’s economic problems and they are not good for social stability or American democracy.

What is the solution?  Wish I knew.

Any ideas?

Comments

  • Greg
  • September 4, 2012
  • 9:58 am

REVOLUTION NOW

  • Philippe
  • September 4, 2012
  • 12:30 pm

Revolution is right… starting with recuperating the benefits confiscated by the 1, 2%… and the profits stored offshore by so many corporations that don’t pay living wages to their employees. Limits to uber-compensations… etc.

  • Shelley
  • September 4, 2012
  • 1:40 pm

Food service jobs will always be more of a stepping stone than an end (though high end experienced food service people can make a decent living).

Gas at $6.00 and up a gallon would help the unemployment situation.

Before anyone tears my head off for this one, consider the current situation when it comes to manufacturing jobs in this country.

Right now, wages and benefits for US workers outweigh the costs of transportation for finished products (at least, in the minds of admittedly deficient upper level management). If transportation costs increase dramatically, it becomes more cost effective to bring jobs back to this country. We’ve already started seeing this with larger items such as bigger TVs and furniture. The bulkier the item, the more likely we can bring the construction back here.

Add in the fact that employers can control the number one most costly benefit–healthcare–by deciding not to provide it (because people can buy healthcare on their own), they can afford to pay a higher starting wage because the company costs are controlled (primarily the cost of wages and raw material, rather than a service whose price seems to vary dramatically annually).

Eliminate the Bush tax cuts–they don’t help employment in this country. They help the employment in China, but not this country.

Use the extra money from eliminating the tax cuts to provide funding for local communities (teachers, service providers), as well as fully staff necessary government positions (food safety anyone?) In addition, inject a significant sum into infrastructure improvements.

In other words, re-create the costs and jobs of a World War without the destruction and death.

Once unemployment decreases, more people are paying taxes, which can then be used to start paying down the deficit. In addition, equalize the taxes for capital gains, close loopholes that allow corporations to get away from paying tax (not to mention certain people). Again, more money for paying down the deficit.

Add tax incentives for good, stable jobs in this country. Add tax incentives for alternative energy development. Increase R & D. Staff schools to a healthy level.

Also provide good re-training for the chronic underemployed and unemployed. Lower tuition–provide decent college funding requiring only that people meet a minimum level of academic excellence (none of this ‘C’ garbage–B and above).

Education is an investment, something too many politicians have forgotten. You can bet other countries (China) haven’t forgotten.

This would be a good start.

(Well, you asked…)

  • Shelley
  • September 4, 2012
  • 1:42 pm

PS I forgot to mention investing in a tech infrastructure. High speed internet for everyone.

Also, we need to jump start a new electronics industry in this country. We need to start to bring these types of jobs back to this country.

Google has already started. One of its new gadget offerings is actually manufactured in the States.

@Shelley mechanization is more the problem than off shoring. Transportation fuel cost are a tiny part of total cost. IMHO the best hope is that worker’s wages will rise faster that the costs of professional services and so narrow wades even while manufactured goods fall in price. Fuel prices will pull more people into fuel production. Higher food prices will provide more jobs i food production. those 2 industries are growing. If the fed would increase NGDP faster we might get back to full employment.

  • Shelley
  • September 5, 2012
  • 11:58 am

Transportation can be significant, especially if the product is large and bulky.

And we can’t say that mechanization is more of a problem than offshoring when the rising unemployment in this country is matched by the rising employment in countries such as China.

The issue is really about both, but only the offshoring is one we can hope to tackle. Reversing the trend for jobs going elsewhere, in addition to offering better re-training for the chronic unemployed are two things we can manage within our shores.

I don’t disagree with your assessment on increasing the NGDP. I’m just not sure the impact of doing so in today’s political climate.

In today’s world, economy is the major problem and so many people are facing the problems with their jobs. Thanks for sharing an informative post. Liked reading it.

  • Shelley
  • September 14, 2012
  • 6:46 pm

Floccina, not sure if you’re still following this thread, but you got your wish, yesterday.

I really do hope it helps.

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