Tag Archives: wages

Graduating College is Highly Overrated

That’s the headline I propose for the Bureau of Labor Statistics (BLS) to attract public attention to its most recent projection of job growth in the next decade.   Though a tendentious conclusion from the BLS study, such a headline could draw the kind of bipartisan outrage that might lead to a more honest and accurate discussion of the relation between education, jobs, and income in these United States.

The BLS does its study of U.S. occupations every two years, showing the number of jobs in each occupation, its educational requirements, and how much it pays.   Though the specifics change, every two years the study shows that a large majority of jobs now and in the future require no education beyond high school.  And every two years the carefully compiled BLS data is ignored, leaving the field clear for everybody from the editorial pages of The Wall Street Journal to President Obama to proclaim that “education is the answer” to economic inequality, poverty, and low wages.

“Graduating college is highly overrated” is about as half-true, and therefore false, as “education is the answer.”  But each claim has some evidence to support it.

According to the BLS, in 2012 only 22% of all jobs required a bachelor’s degree or more, and of the more than 50 million job openings the BLS projects by 2022, only 22% will require a bachelor’s or more.  (In fact, if all you have is a bachelor’s degree, there are only 17% of jobs now and 17% of job openings projected by 2022 that require that degree and no more.)  Problem is that about 32% of the population over the age of 25 has a bachelor’s, and among young people ages 25 to 34, it is a bit higher at 34%.  In other words, there are only two jobs for every three persons who have a bachelor’s degree, and the number of people getting bachelor’s degrees is growing faster than the number of jobs that require that degree – or anything close to it.

Indeed, 26% of jobs in 2012 did not even require a high school diploma, and another 40% required only a high school diploma.  And the BLS projects that it will get worse by 2022, when nearly a third of all job openings will require “less than high school.”

There is a more ambiguous category of jobs that require some “postsecondary education,” whether an associate’s degree or some kind of specialized training certificate or simply “some college.”  But they are required for only about 11% of jobs now, and are projected to provide about 12% of job openings going forward.

The table below summarizes how overeducated our population is for the jobs we actually have.

Level of education

% of people over 25 with this level of education

% of jobs that require this level

Less than high school

12

26

High school diploma

30

40

Some college, A.A., or postsecondary

26

11

Bachelor’s or higher

32

22

We have an oversupply of jobs that require high school or less (66%) compared to the 42% of people whose education fits those jobs.  And conversely, we have an oversupply of people with some postsecondary education (58%) for the 33% of jobs that require something like that level of education.

Just looking at what jobs are now and will be available in the U.S. economy, graduating college seems highly overrated – and it might even be that “going to college is for suckers.”  If all you need for most jobs is a high school education, why bother with college?  That’s simple: wages.

A recent Pew Research Center study, The Rising Cost of NOT Going to College, looks at how income correlates with earnings.  As previous studies have found, high school graduates make $7,000 more a year than those who do not graduate.   Those with “some college” make an additional $2,000, and those who get bachelor’s degrees make $13,000 more on top of that.  The gradient could not be clearer: those with bachelor’s degrees have average incomes twice that of those without high school diplomas ($45,000 vs. $23,000).  What’s more, unemployment rates, poverty rates, and other things follow a similar gradient: the more education, the lower the unemployment rate, the lower the poverty rate, and the more likely you are to have full-time employment and employer-paid benefits.  Conversely, though there are and will be plenty of jobs for people who do not graduate from high school and for those whose education ends with a high school diploma, these jobs generally pay miserable wages – almost uniformly less than $30,000 a year, and most much less.

So, “education is the answer” has some evidence to support it, too.   But both statements are half-truths – not much education is required for most American jobs (now and in the future) and more education leads to higher pay and steadier employment.   It is only when you put the two half-truths together that you can see the whole picture.

If you are an individual 18-year-old, your only chance for a decent income is to go to college or to get some other form of postsecondary education.  Statistically, it will give you a 2 to 1 shot at a decent standard of living vs. a thousand to one for high school graduates and a million to one for those who never graduate from high school.   But if all 18-year-olds – or even most of them – play these odds by going to college, it will do nothing to remedy economic inequality, low wages, and poverty.   In fact, it would probably make all these things worse.

The increasing imbalance of supply and demand — more college graduates than jobs that require them — puts downward pressure on the wages of jobs that require higher education and ensures that more college graduates will be forced to take jobs that do not require college.  Pew found that more than one-third of the recent college graduates it surveyed were currently working in jobs that do not require any college.  Likewise, as more college graduates take jobs that require only high school, more high school graduates are forced to take jobs that do not require a high school diploma, and those who did not graduate from high school have great difficulty finding and keeping any job.   It’s a perfect formula for cheapening all labor.  More and more education is required to attain a decent standard of living, but as more and more people gain higher levels of education, they further flood those higher-paying job markets, leading to lower average wages and living standards for everybody.

The Pew study emphasizes the growing gap between the incomes of college graduates and non-graduates, but it also shows that the real wages of recent college graduates have basically stagnated since 1986.  The growing premium paid to people with bachelor’s degrees is almost entirely the result of 13% and 18% declines in real wages for high school graduates and those with “some college.”

Earnings

More formal education may be an answer for individuals – and I do all I can to convince my grandsons of that.   But it is not and cannot be any part of the solution to economic inequality, poverty, and low wages.   The remedy for all three is the same: higher wages, starting at the low end and reaching up to frontline supervisors.  To get higher wages, workers with and without college degrees are going to need the kind of organized, disciplined collective action that we are beginning to see the first glimmers of among fast-food, Walmart, warehouse, and many other workers.

Those of us in higher education can help by developing a curriculum that will be relevant to those one out of three of our graduates who will not be getting jobs that require college educations.   They need courses in the history of American social movements and courses that teach organizing tactics and strategies for workplace, community, and political organizing, complete with “service learning” internships.   Those are the skills that are needed to raise wages and reduce poverty for the vast majority of American workers.  If we taught those skills, then graduating college might be a bit less overrated than it is today.

Jack Metzgar

We Are Worth More

Last month a few hundred retail and fast-food workers, from places like Sears, Dunkin’ Donuts, and McDonald’s, walked off their jobs for a rally in downtown Chicago.   Carrying signs saying “Fight for 15” (or “Lucha Por 15”) and “We Are Worth More,” these workers make $9 or $10 an hour, at best, and they figure they’re worth at least $15.

A one-shift walk-out and protest by a few hundred out of the thousands of such workers in the Chicago Loop and along Michigan Avenue’s Magnificent Mile cannot have the economic impact of a traditional strike – one that shuts down an entire workplace or industry for an extended period of time and, therefore, can bend an employer’s will.   And these workers’ chances of getting $15 an hour any time soon are worse than slim.   This “job action,” bolstered by community supporters organized by Action Now and with help from Service Employees International Union organizers, is more in the nature of a public protest than a “real strike.”   You could even call it “a public relations stunt,” but you’d be wrong to dismiss it as inconsequential.

“Public relations,” ironically, has a bad image.  But think of it as workers witnessing their own plight, calling for others in similar situations to join them and appealing to those of us with decent incomes to support them.  Witnessing, with its religious overtones, is not intended as an immediately practical action.  It’s first about individuals summoning the courage to put themselves forward to make a public claim that they are one of thousands (millions nationally) who are being treated unjustly.  In this case, it means taking the risk that they may be fired or otherwise disciplined for leaving work and going into the streets to proclaim “We are worth more.”

Witnessing is meant to make us think about justice as the witnesses simultaneously inspire and shame us with the courage of their individual actions.  I was at one of the first draft-card burnings that protested the Vietnam War in 1965, and I remember saying something like, “I’d do that if I thought it would do any good,” while knowing in my heart of hearts that I didn’t have the guts to take that kind of risk then.  But it inspired and shamed me – and thousands and then hundreds of thousands of others — to do many other things to fight against that war as we inspired and bolstered (and exerted peer pressure on) each other.

For the broader public, these initial job actions – in New York and Chicago among retail and fast-food workers; in California and Illinois among workers at Walmart warehouses; and all over the place among Walmart retail workers – are “public relations” that raise awareness and pluck consciences.   But for workers who watched workmates walk off the job to witness for them, there may be some of that inspiration and/or shame that is a particularly powerful call to action. That’s what organizers are counting on, in the hope that the numbers of such workers will grow helter-skelter across the retail industry, eventually initiating a contagion of worker direct action that can put these workers in a position to negotiate for “labor peace,” with or without the blessing of the National Labor Relations Board.

There’s another determined witness who couldn’t be more unlike these striking workers.  He’s a retired law professor from the University of Texas, Charles Morris, who is a leading expert on the legislative and early administrative history of the National Labor Relations Act and the Board that enforces it.  In a 2005 book, The Blue Eagle at Work, Morris makes the legal case that the Act defined a labor union as any group of two or more workers who act together (“in concert”) to seek redress of grievances from their employer.   According to Morris, the “concerted activity protection” articulated in the Act means that employers cannot legally fire workers for forming a non-majority  or “members-only” union (as few as two workers acting together), and what’s more, an employer is legally bound to “bargain in good faith” with that union.

Through meticulous legal research, Morris has shown that these worker rights were in the Act from the beginning but have been forgotten by the subsequent customary practice of defining a union as only that group of workers who have formally voted to be represented by a petitioning union. What’s more, other legal scholars have now signed on to Morris’s legal interpretation and are ready to bolster it before an NLRB that is willing to hear their case.  There would be such an NLRB, what Morris calls “a friendly Board,” if Republican Senators would allow a vote on President Obama’s nominees for the Board.

A favorable NLRB ruling would be important for a variety of legally technical reasons that workers and organizers could use to their tactical and strategic advantage – none of which includes the expectation that employers will voluntarily obey the law just because it is the law. But equally important is that Morris’s reading of the Act’s history restores the original meaning of a labor union that is based on workers’ decisions to act together “in concert” with one another.  That is, a labor union is not just an institution with a bureaucracy and a marble palace in Washington, D.C., though it may be that as well.  It is any group of workers in any workplace, no matter how big or small, who decide to and then do act in concert to advance their own interests in their workplace.

In March Chicago Working-Class Studies helped organize a public forum that brought Charles Morris together with workers and organizers from Fight for 15, the Walmart retail and warehouse strikers, and two other groups who are already acting as unions under this definition.  Though there were some disagreements between the elderly legal scholar and the mostly young workers and organizers — one emphasizing the importance of politics and administrative case law in the long run, the others focused on the potential of direct action in the here and now – they agreed that if and when the two come together, the possibilities for a worker-led upsurge of union organizing are great.

Nonetheless, through their actions these workers have already changed what a labor union is and is thought to be.   It is now, and really always has been — even a century before the National Labor Relations Act was passed in 1935, even when it was an illegal “conspiracy” — simply a group of two or more workers acting in concert with one another.   To be really effective there will need, of course, to be many, many more than the hundreds and thousands who have begun this process.  But it starts with a few brave witnesses who take a risk and ask others to join them.  The peer pressure is now on the rest of us.

Jack Metzgar, Chicago Working-Class Studies

Raising the Minimum Wage — The Right Way

Ever since President Obama took office I’ve periodically wished I had the ability to call the White House get him on the phone and say “Hey, you’re not doing it right!”  Let me be clear—I don’t mean he hasn’t done the right thing—just that he’s too often done the right thing the wrong way.

For example, like many economists and advocates for working families, including Paul Krugman and Robert Reich, I thought the President’s economic stimulus package was way long on help for the “Too Big to Fail” banks and other Wall Street institutions and way short on dollars for infrastructure projects, support for education and job training, and other programs that would have helped the working families who inhabit the nation’s Main Streets.

Same thing with health care reform.  Yes, it needed to be done. But he did it wrong.  Instead of a system that guarantees health insurers millions of new customers, does little to rein-in costs, and gives anti-reform advocates the ammo they need to scare small and medium sized businesses into opposing the plan, he could have done something simple: Medicare for all, or at least for all of us over the age of 55. Not only would this approach have made Medicare solvent by bringing younger, healthier people into the system, it would have given the government immense power to negotiate lower costs with providers.

Unfortunately, the same principle applies to the President’s proposed minimum wage increase.  It’s the right thing to do, but nine dollars an hour? Really?  At least in this instance Mr. Obama’s not alone in being wrong.  Predictably, the Republicans and their bosses in the business community, led by the U.S. Chamber of Commerce, the National Federation of Independent Business, and the National Restaurant Association, became apoplectic seconds after the words “raise the minimum wage” rolled off the President’s tongue during the State of the Union address.

Their reaction was as predictable as the specious claims they make about the cataclysmic effect giving the folks at the bottom of the economic ladder a boost will have on the economy.  Business leaders wail and gnash their teeth any and every time raising the minimum wage is proposed, including back in 2006 when labor led the successful effort to win voter approval of an Ohio Constitutional amendment that both raised the wage and indexed it to inflation.

The fact that their dire prognostications have never come to pass—last time I checked people are still doing business in Ohio despite the onerous burden of having to pay workers a whopping $7.85 an hour, and Costco is thriving despite paying starting employees more than $10 an hour –apparently doesn’t matter to them or to the members of the media who give their ludicrous contentions credence by repeating them.

Unfortunately, President Obama’s proposal was every bit as predictable in nature and scope as the arguments against it.  Raising the minimum wage $1.75 is fine as far as it goes—which isn’t far enough.  Had the President and his advisors really given the issue some thought they could have crafted a plan that would have both insulated the administration from criticism and gone a long way toward addressing the income inequality that plagues the working class and the middle class and has the U.S. economy stuck in neutral.

Here’s the deal.  Part A:  raise the minimum wage to $9 per hour for the vast majority of employers.  Their protestations to the contrary, it won’t bankrupt them or force them to cut jobs.  Especially when they begin ringing up the additional sales Part B of the plan generates: raising the wage to $15 per hour for full time and $11 per hour for part-time workers employed by the nation’s largest companies.

There’s little doubt that companies like Wal-Mart will attempt to avoid paying the higher wage by eliminating full-time employees or turning to temp services for workers.  To stop them, the law must include provisions that prevent employers from moving workers from full-time to part-time status and that classify temps as employees of the corporation using them.  Those two provisions would help ensure that companies comply with the letter and spirit of the law.

Which firms would qualify as “large” under the plan?  Those that directly employ 100,000 or more and average 80 workers per location.  Under this definition franchise operations like McDonalds and most other fast food chains would be exempt.  In addition, the increase would have little or no impact on large employers like IBM, UPS, FedEx and others who already pay above the proposed new minimum.

The plan would affect retailers like Wal-Mart, Target, Macy’s, Kroger’s, Home Depot, and Lowe’s along with America’s biggest banks—the folks responsible for the 2008 economic implosion would.  (Here’s an important side note: although most people equate low wages with retail, bank employees are grossly underpaid, and financial institutions are infamous for aggressively opposing union organizing drives.)

Using Wal-Mart as an example and assuming that 40% of the company’s 2.1 million workers are full time, their aggregate annual wages would climb from $17.4 billion to $26.2 billion.  Annual wages for the retail giant’s 1.2 million part-timers would jump by nearly $5 billion, from $12.5 billion to $17.2 billion.  In all, the increases would pump an additional $14 billion into the hands of Wal-Mart workers every year.

Imagine the staggeringly positive impact this one policy would have on the economy when the wages of the more than 3.5 million people who work for America’s other large corporations are factored in.  Billions of dollars will be spent on homes, cars, clothes, food, dining out, movies, electronics, and other goods.  People who now live paycheck to paycheck will actually be able to save and plan for the future. In short, millions of working families will have an opportunity to grab a piece of what has become a fading American Dream.

The increases would also help reduce the deficit—something Republicans should love.  Higher wages will generate more income and sales tax revenue.  As salaries rise, so will the flow of dollars into Social Security and Medicare, especially when tens of thousands of workers are no longer eligible for the Earned Income Tax Credit because they’re earning a living wage.  Finally, government spending will fall because the legions of low-wage workers at Wal-Mart and other firms that now receive government benefits will no longer need them.

But instead of a bold plan that could end decades of wage stagnation, we get a small across-the- board increase that simply won’t get the job done.  Someone get me the number for the White House.  I need to call Barack and tell him he’s doing the right thing the wrong way.

Again.

Leo Jennings

Home Health Workers: In Demand But Not Protected

In the nearly 20 years I’ve spent organizing long term care workers, I hadn’t really personally experienced the difficulty of being a care giver.   I worked the policy, political, advocacy, organizing and bargaining pieces in the Union for home care workers.  The women I organized were strong and bold and everyone had a story to tell. We told their stories of care giving in the hope that the workforce would no longer remain invisible and would begin to be seen as the emerging face of the labor movement along with immigrants and service workers.

I have a story to tell as well now.  My mom and dad are in their 80s and in poor health.  Caring for them is the most difficult work I have performed in my life, both mentally and physically.  I moved back home two years ago to care for them.  Ten years ago I used to fear that they would die.  Now I fear that they will live. Each day brings its own lessons in compassion, like when I wake up in the morning and there is no hot water to shower because Mom got up in the middle of the night and left the water running, or, when I am ready to walk out the door to take my son to pre-school and Dad’s colostomy bag breaks and I have a mess to clean up.  Then Dad begins to cry, I try to comfort him, and my son is late for school.   I think back to the women I’ve organized and look to them for strength. I do this for free, which prevents me from working full-time elsewhere, but the workers who did this for a living, mostly women and people of color, really aren’t doing much better financially.

Home health workers are among the most in demand but lowest paid workers in America.  There are 2.5 million caregivers in the workforce, and that number will grow over the next decade because of aging baby boomers, many of whom seem to prefer to receive care at home. Employment in care giving is expected to grow by 70% from 2010 to 2020, much faster than average for all occupations. Over one million workers in this industry have no health insurance. 90% of direct care workers are women, and many are primary breadwinners in their families. Caregivers are paid minimum wage or, if they’re lucky, just slightly above.  Earning such low wages with no health insurance means that 46% of direct care workers rely on some type of government program, such as food stamps, Medicaid, housing, child care, energy assistance, or transportation assistance.

Over one million direct care workers are consigned to near-poverty because of the structure of their employment. The home care workers bathe, change, dress, and feed their clients.  They also perform home-making duties, such as cooking, cleaning, and shopping. These workers face whatever they have to, depending on the kind of day their clients may be having.  Even if the home care agency tells them that they have one hour to get a client dressed, fed, and settled in his/her chair for the day, it may take longer.  But workers do not leave their clients.  Instead, they work “off the clock.”  A home care worker may have four clients for the day but does not get paid for mileage or travel time between clients, much less any benefits for themselves. If the worker’s client becomes ill and is admitted to the hospital, admitted to the nursing home for further care, or dies, or if the family takes the client to their home for the holidays, the worker simply loses that job and does not get paid.  There are no sick days and no vacation days.

Home care workers may be employed by an agency or be independent providers. In either case, the work environment includes a number of safety and health hazards: blood-borne pathogens and biological hazards, latex sensitivity, ergonomic hazards from client lifting, violence, hostile animals, and unhygienic and dangerous conditions.  They may also face hazards on the road as they drive from client to client.

Unfortunately, these workers have been denied the right to organize and bargain in some states, like Ohio. Home care workers are also excluded from the Fair Labor Standards Act, making them ineligible for overtime, including overnight stays at a client’s home. President Obama spent a day working as a home care worker in California not long after announcing his candidacy in 2007.  Last year, the President proposed a revising a Labor Department rule that would provide FLSA protections to home care workers, and the final rule is still being deliberated.  Guess who opposes the rule change?  The home care agencies.  Agencies receive at least $15 billion of Medicaid money annually for personal care services and are happy to have government money, which fueled a 9% average yearly increase in revenue between 2001 and 2009.  Government becomes harmful, it seems, only when setting a floor under workers’ wages.  The fight isn’t about raising the minimum wage or getting overtime legalized-that would still leave home care workers poor.  It’s about winning some labor standards, rights, and security after decades of losing them.

What happens to this growing element of the working class matters for the shape of our economy, the fate of unionism, and the establishment of a decent standard of living for all.

Debra Timko

Debra Timko was a leading health care organizer for 20 years and is now an independent health care researcher studying the lives of health care workers in Northeast Ohio

$2 Trillion

I really have no conception of how much $2 trillion is, and I’m not helped much by knowing that it’s enough for a stack of 20-dollar bills to reach the moon.  $2 trillion is really, really a lot of money – I got that part.  I know that it is $2,000 billion, and that helps some because I have some sense of what a billion is.  I also know that $2 trillion is equivalent to 1/7th of the entire U.S. economy, which has a GDP of about $14 trillion.  So $2 trillion is a huge amount of money, but it is a relatively small piece of the whole, about 14%.

$2 trillion is the amount that businesses are currently holding in cash and short-term investments rather than investing in long-term productive activity that would create jobs and thereby spark our stagnant economy to life.

$2 trillion is also roughly the additional amount that full-time workers would earn each year if productivity growth had been shared since 1979 the way it was for more than thirty years before 1979.  (I get this from Steven Greenhouse’s The Big Squeeze, page 5, where he calculates that shared productivity growth would result in full-time workers earning about $22,000 more than they actually do.  There are about 100 million full-time workers, and multiplied by $22,000, that amounts to $2.2 trillion.)

I think these two different $2 trillion amounts are related.  That the $2 trillion lost to workers by the disappearance of productivity sharing has piled up in corporations where they cannot find a useful purpose for it.   And  because their wages have stagnated, workers do not have enough spending power to buy all that our economy can produce, and that this insufficiency of wages and salaries is the principal cause of our current economic stagnation.  If this is so, then raising wages (and quickly) would be the best way to stimulate our economy.

This is relevant because the business press is currently debating why that $2 trillion in corporate cash and short-term investment is being “sidelined” (meaning not just temporarily out of the game and ready to substitute for existing players, but in the football metaphor, that the economy is playing with only 9.5 players rather than 11).  One view says this huge amount of money is sidelined because of “business uncertainty” related to all the new regulations the Obama administration is imposing.  The other view holds that businesses are sitting on this money because there is insufficient consumer demand to assure businesses of profitable investment opportunities.  The second view believes that if consumer demand were “robust,” businesses would take that $2 trillion off the sidelines and even borrow money to invest in productive economic activity.  The vast majority of consumers are wage-earners, of course, the same folks who lose about $2 trillion a year because they have not been sharing in economy-wide productivity gains.

If these various $2 trillion amounts are related as cause and effect, it means that transferring some part of the $2 trillion in sidelined money – say just $500 billion – to workers in increased wages and salaries would result in more profitable opportunities, thus more business investment, millions more jobs, even more profitable opportunities, and an economy growing at 5% or 6% (for a while) rather than the hoped for 3% growth that is now projected.  At 3%, a good growth rate in normal times, it might take a decade to get unemployment down to below 5%, and meanwhile an enormous amount of permanent social and economic damage will continue to be done.

Though I’m not an economist, I am well aware that there is no existing mechanism for increasing wages that dramatically across the economy – a $500 billion transfer from the corporate pile to wages and salaries would amount to a $5,000 increase for every full-time worker.  Unions are now too weak to get substantial increases like that for their own members, let alone to have their traditional positive “spillover” effect on nonunion workers.  And the federal minimum wage is now so low (at $7.25 an hour) that raising it even very dramatically (to say $10), while highly desirable, doesn’t affect enough workers to get much of that corporate pile off the sidelines.

The point is that our economy is growing too slowly because workers don’t have enough consumer spending power, and as a result, businesses don’t have enough investment opportunities to put all their capital to work.  Investors have too much because workers have too little, and vice versa.  Transferring a sizeable chunk of it would probably be good for everybody.

Fighting for living wages and improving prospects for union organizing are the best options to restore productivity-sharing going forward.  But in the short-term, to get us out of our current stagnation, the one best way to restore the balance between investors and consumers might be to raise taxes on corporations and high-end individuals and then air drop the resulting revenue in 20-dollar bills onto low-wage communities across the country.

If that strikes you as a frivolous idea, ask yourself why there is no national discussion of how to restore productivity sharing in order to increase wages, consumer demand, business investment, and millions and millions of jobs.  Ask yourself why, instead, we’re discussing how to cut Social Security and public service workers’ jobs and pensions.

Jack Metzgar, Chicago Center for Working-Class Studies

America’s Low-Wage Future

British historian E.H. Carr once said something to the effect that while no serious scholar makes up the facts, they all choose which facts “to put on stage.”  The problem of cultural bias is that there are way too many facts to give them all their proper due, and in choosing what we think is most significant among them, we are guided by our own focus and general sense of significance – that is, by our values, our hopes and fears, and our everyday sense of how the world works.

Every two years the Bureau of Labor Statistics (BLS) makes detailed projections of how many jobs there will be in which occupations ten years from now.  The latest one came out late last year, and among a dizzying array of facts and figures, here’s what they headlined in italics at the top of their report:

Professional and related occupations and service occupations are expected to create more new jobs than all other occupational groups from 2008 to 2018; in addition, growth will be faster among occupations for which postsecondary education is the most significant form of education or training. . . . .

This was duly reported by The New York Times under the headline “Where the Jobs Will Be,” with the same emphasis on “professional and related occupations” and “postsecondary education.”   The message is that our society is going to need many more college graduates than it has now, which is true.  The impression most often left, however, is that we are rapidly becoming a society of “professionals” and “knowledge workers,” and that the key to our future is making sure that almost everybody gets a college education.  This impression is not only false, but spectacularly so.

Disguised in the text, but present in the BLS tables is another set of facts: Only 21% of jobs now require a bachelor’s degree, and despite faster growth among these credentialed occupations, that isn’t going to change much.  By 2018, according to the BLS, only 22% of jobs will require a bachelor’s degree or more.  Of the 51 million “job openings due to [both] growth and replacement needs” in the next ten years, fewer than 12 million will require a bachelor’s degree.

At the heart of what the BLS and The New York Times choose to put on stage is a confusion between the fastest growing jobs and the jobs with the largest job growth.  Though the BLS tables report both the fast and the large in detail, the headline and the text emphasizes speed over size.  For example, the fastest growing occupation in the next ten years will be biomedical engineers; these jobs will increase by a whopping 72% from 16,000 to nearly 28,000, a net increase of 12,000 jobs.  Meanwhile, retail salespersons will see job growth of a meager 8.4%, but since there are now more than 4 million of them, that’s an increase of 375,000 jobs.

A second confusion involves the word “service,” which in other contexts is used to indicate all work that does not involve making or building things, as in “service economy.”  This usage conjures images of doctors, lawyers, teachers, and management consultants – all of them growing occupations and highly paid.  But that’s not what the BLS means by “service occupations.”  The BLS service jobs with the largest projected growth are home health and personal aides; food service workers (including fast food); nursing aides; landscaping and groundskeeping workers; medical assistants; security guards, and child care workers – all of them already very large and all of them paying “low” or “very low” wages.

Of the 30 fastest growing occupations, 14 require at least a bachelor’s degree and another five will require an associate’s degree; all 19 of these fast-growing jobs pay “very high” or “high” wages by BLS standards.  That is good news.  But among the 30 with the largest growth, only seven require a bachelor’s and one more requires an associate’s.  And, unlike the fast, of the top 30 for size, the majority of new jobs are either “low wage” or “very low wage.”   Here’s my tabulation of the largest 30 by how well they pay:

Top 30 occupations with largest projected job growth, 2008-2018

2008 median annual earnings

by quartiles (# of occupations)

# of new jobs projected % of top

30 jobs

Very High:

$51,540 & above  (7)

1,771,100

24%

High:

$32,390 to $51,530  (8)

1,523,100

21%

Low:

$21,590 to $32,380  (9)

2,131,400

29%

Very Low:

Less than $21,590 (6)

1,899,400

26%

These top 30 occupations account for about one half of the net new jobs the BLS projects, and other data show that the wage composition of these 30 is not unrepresentative of the job structure as a whole, now and in 2018.  If these were the facts the BLS chose to put on stage, the headline might be: Majority of American workers projected to remain poorly paid and in need of a living wage.

We might then realize that we cannot close the widening gap between the earnings of high school graduates and college graduates simply by producing more college graduates.  There simply are not and will not be enough jobs requiring a college education. With a different set of facts on stage, we would understand that we need to do something to increase the majority’s wages and incomes directly.

What’s more, as a nation we know how to do this because we’ve done it before, in the three decades after World War II.  Though each has its limits, we need some combination of greater unionization, steadily improving minimum wage laws, and enhancements in the social wage, now called “work supports.”  Democrats, for all their other faults, have committed to advancing on all three of these fronts, and in the last three years have advanced a little on each of them.  College professors (called “postsecondary teachers” and #10 on the BLS largest list) could lend a hand simply by putting some of these “other” facts on our stages.  The BLS largest list is a richly complex document that reveals contradictory tendencies in what some 150 million of us do and will do to earn a living.   My arrangement of that list by educational requirements and pay simplifies it some by separating out those countertendencies.  No facts are made up, but by reorganizing the stage, the same facts make a decidedly different impression.

Jack Metzgar

Stop Stealing from Workers

Late last year I sat in the office of an Ohio County Prosecutor and provided her and the County Sherriff thick notebooks documenting a systematic theft of workers’ wages by a local construction contractor by means of misclassification under Ohio Prevailing Wage Law and systematic underpayment. The theft was compounded by the fact that company officials signed false verifications of compliance with state prevailing wage laws under penalty of perjury.   To add insult to injury, the job on which the wage theft took place was being paid for with tax dollars from that same county.

I asked the Prosecutor what would happen if a local construction contractor had brought evidence that one of their workers, perhaps a bookkeeper, had fraudulently written herself tens of thousands of dollars in checks from funds belonging to the company and then lied about the theft on government mandated reports signed under penalty of perjury. The Prosecutor, Sherriff, and their assistants and deputies all assured me that the culprit would be prosecuted to the fullest extent of the law.

I smiled, certain that  these law enforcement officials, ethical office holders, and civil servants would be as anxious to arrest and prosecute the owners of the construction company for stealing wages from their employees and lying about it under penalty of perjury as they would be to prosecute that bookkeeper.

I couldn’t have been more wrong.

They flatly refused to treat the wage theft as a criminal offense.  Instead, the company’s conduct was treated as a “mistake,” blamed on failure to understand the law.

Enforcement was left to the Ohio Department of Commerce, which could only require the company to pay back wages.  While more than $40,000 was ordered to be paid to the 9 employees and a 100 percent civil penalty assessed, the company owners were spared the life changing consequences of a criminal prosecution.

My experience was put into disturbing context by Kim Bobo’s new book, Wage Theft in America: Why Millions of Working Americans Are Not Getting Paid—and What We Can Do about It (New York: The New Press, 2009) .  Bobo documents a wage theft crime wave across the United States. The victims range from illegal immigrants who fear deportation if they report violations to skilled construction workers who are forced to kick back parts of their paycheck on government projects, and includes childcare and home healthcare workers, sales clerks, and many others.  Bobo makes a compelling case that wage theft is far more pervasive than most of us understand or would like to admit.

Bobo draws her analysis primarily from her experience in running Interfaith Worker Justice Center in Chicago and cases handled by other worker centers throughout the country, and  a recent study of over 4000 low wage workers dramatically verified Bobo’s conclusions.  The study, “Broken Laws: Unprotected Workers,” makes stunning discoveries of the rampant nature of wage theft in America. Here are a few of the conclusions:

  • 26 % of respondents had been paid less than the minimum wage in the previous workweek.
  • 25% of the respondents had worked more than 40 hours in the previous week but a  whopping 76% of them were not paid overtime.
  • 70% of workers who arrived early or stayed late at their employer’s request were not paid for the extra time.
  • 69 % of workers entitled to meal breaks didn’t get them.

Wages are stolen from tens if not hundreds of thousands of American workers every day.  If employers were stealing from customers in such a systematic way, law enforcement at all levels would be forming task forces and putting thousands in jail.

Why should theft of wages from American workers be different?  Bobo suggests that most instances of wage theft can be traced to old-fashioned greed.  Greed is sometimes dressed up with rational sounding names like “pressure from competitors in low wage countries” or “innovative” compensation schemes.  But at the end of the day employers steal from those who work for them in order to make more money.

Bobo correctly points out that wage theft is also driven by the greed of consumers who demand low prices.   That demand leads some companies to indirectly encourage wage theft.    Bobo quotes the Congressional Testimony of MIT Professor Thomas Kochan, regarding the poster child for wage theft in America: “Wal-Mart executives have established corporate policies that are ethical and appear to conform to legal requirements. However Wal-Mart has also established financial and business objectives that managers find difficult to achieve without circumventing those rules.”  This is a scenario not unique to Wal-Mart. Despite ethical, legal policies, many companies repeatedly steal from their employees in order to reduce labor costs.

But perhaps the biggest factor is the lack of consequences.  Wage thieves are only rarely caught, and those who are face almost no legal, financial, or societal consequences.  Often the worst penalty for a wage theft is being forced to pay workers what they should have been paid to begin with and then only for the period of time allowed under the statute of limitations (often as little as two years).   Weak enforcement of relatively weak laws is as much to blame for the widespread practice of wage theft as employer or consumer greed.

Wage Theft in America proposes a variety of potential solutions to the problem.  Bobo’s proposals range from creating more worker centers to dramatically beefing up the enforcement capacity of Federal and State Wage and Hour Enforcement Agencies to policies that increase the number of workers represented by labor unions.  While her proposals would work, much of what she suggests would require legislation and appropriations that are politically unattainable even with Democratic control of all three branches of the federal government. (See the recent collapse of card check provision of the Employee Free Choice Act, if you have any doubt about this).

However, some less controversial and inexpensive strategies can help.   Congress needs to simplify economic protection laws and make it easier for employees to report wage theft offenses.  In particular, workers need reliable protection against retaliation for reporting violations.  Workers currently risk of termination or other workplace punishment if they report wage theft.

But ending wage theft may not require new laws.  Instead, government agencies should simply enforce existing regulations.  It won’t take many well-publicized arrests to persuade employers to stop cheating workers.

Making that happen will require political pressure.  Activists, religious organizations, and labor unions need to reignite the kind of moral outrage that brought about our current labor laws almost a century ago.  Rooting discussions of wage theft in religion can help.  Bobo argues that religious teachings from the Old Testament to the Quran demand that workers receive their fair day’s pay.  Because of this, religious organizations can be fertile ground for generating moral outrage against those who exploit the least among us.

Labor Unions and political activists should educate elected prosecutors and sheriffs about wage theft and how it undermines local citizens and the community.  And they should pressure law enforcement officials to do their jobs.  Local business communities should also support such efforts, since cheating competitors have an unfair advantage over ethical businesses that follow the law.  And since Bobo’s book demonstrates that companies with labor unions are less likely to commit wage fraud than their competitors, union leaders should engage their counterparts across the bargaining table to join in efforts to encourage more serious enforcement.

Unions and their lawyers can devote resources to investigating and documenting wage theft, providing overburdened state and federal officials the evidence they need to bring cases.  Efforts by construction unions to promote “fair contracting” have forced non-union competitors to comply with prevailing wage laws. Organized labor should embrace these efforts as tools to strengthen unionized competitors in every industry and for organizing more companies in the future.  Such efforts also show management and potential members the added value that having a union can bring to a company and its workers.

Wage Theft in America frames the debate as about not just the value of labor unions in the workplace, but also the value of workers themselves.  Reframing wage and hour violations as crime, reclaiming the moral high ground, and refusing to tolerate wage theft not only discourages cheating of workers but also reminds companies that operate ethically, as most do, that wage theft cuts into their bottom lines.  Such changes in the public debate would certainly have changed the outcome of my efforts to prosecute the cheating contractor in Ohio.

Marc Dann is a lawyer in Cleveland who represents labor unions and workers seeking fair wages and contracting practices and has been a community affiliate of the Center for Working-Class Studies for four years .