Skip to main content

Convenience store cashier at work.
It probably won't come as a surprise that less-educated American workers have been struggling to make a living in recent years, but the numbers might still shock you: Working men aged 30 to 45 with no high school diploma saw their median earnings fall by 20 percent between 1990 and 2013. That means that this group saw a drop (measured in 2013 dollars) from $31,900 in 1990 to just $25,500 in 2013. Why would that be?

Well, globalization and technology—which are often cited to prove that such wage drops are inevitable—are part of it, but they're not the whole story. It's true that:

... there really is a shift away from the sectors where less-educated workers can earn a decent living. In 1990, 40 percent of the prime-age male workers without a high school degree worked as operators and laborers, a number that declined to 34 percent in 2013. Jobs in food service, cleaning and groundskeeping nearly doubled in the same span, to 21 percent from 11 percent. But it wasn’t an even trade: Pay for operators and labors was $25,500 in 2013, compared with $20,400 for the food, cleaning and groundskeeping category.
But that's just a small part of what's going on. The corporate race to the bottom is a much bigger reason for declining wages for workers with a high school diploma or less:
A bigger effect is downward pressure on pay in jobs held by low-education workers across the board.

So not only did people shift from higher-paying fields to lower-paying ones, but inflation-adjusted pay also fell in all of those jobs. For example, production work — manufacturing, largely — was the highest-paying category for men without a high school diploma in 2013, paying them $28,000. But that sector was both smaller (29 percent of such workers, down from 31 percent) and paid less (down from $33,600) than it did in 1990.

Numbers like these point to two big economic changes we need to win in the United States. First, workers need to join together and fight back. Part of the declining working- and middle-class share of income can be directly linked to declining union density. Class war from above is working, and disarming is not the way to fix that. Second, this is another data point in the argument for free public higher education: a college degree is coming to be as much of a necessity to make a living as a high school diploma was a generation or two ago. Just as public high school became free and widely available when that level of education became necessary to employment, it's time for college to be free now, so that being able to afford college to begin with doesn't become even more of a driver of economic inequality than it already is.
Wisconisn Governor Scott Walker gestures as he addresses the second session of the Republican National Convention in Tampa, Florida, August 28, 2012 REUTERS/Mike Segar (UNITED STATES  - Tags: POLITICS ELECTIONS)
Gov. Scott Walker (R-WI)
Republicans have been itching to show how much better they could do with the American economy than President Obama has done. But Republican governors have had the chance to show what they can do with their own states' economies, and the crop currently planning to run for president ... well, they've shown us something, but what?
How about being embarrassingly bad at job creation? That’s right. From January 2011 through January 2015, Louisiana under Jindal ranked 32nd in job creation with 5.4 percent growth over four years. Wisconsin under Walker ranked 35th, with 4.85 percent growth. New Jersey under Christie ranked 40th, with 4.15 percent growth. This compares with a national average of 8.21 percent.
Ouch. And these are the guys who are—or were—supposed to be the GOP's rising stars. That's not all, either, as Paul Rosenberg shows:
It’s not just the embarrassing job-creation numbers, though that alone should be enough to disqualify the whole lot of them. New Jersey has just experienced its ninth bond downgrade under Christie, who may end up looking for a bridge to hide under. In Wisconsin, Walker, facing a two-year deficit that could go as high as $2 billion, has responded with $300 million in cuts for higher education, on top of billions in previous education cuts. Still, job creation was supposed to be Walker’s big thing—he promised to create 250,000 jobs in four years when he first ran in 2010, but came up short by more than 100,000 jobs. Making matters worse are the neighborhood comparisons. Wisconsin ranked between 29th and 41st in job growth over the last four years, the worst in the Midwest three of those years, and second worst the other. In fact, the state performed poorly on a whole host of indicators used by Bloomberg News, and suffers markedly in contrast with neighboring Minnesota, where progressive policies have that state’s economy recovering nicely.
Of course governors can only control so much, but when you're below the national average in job growth and suffering on a range of other measures, the problem might just be something about the policies you're pushing. Do we really want to see those policies applied to the nation as a whole?
Alliance charter school teacher Xochil Johansen:
Taco Bell taco
Don't say the fast food industry never did anything for all that it gets from Congress, like a low minimum wage and support in the industry's efforts to keep workers from organizing unions or getting health care. Lee Fang reports that just this week, Taco Bell made its lobbying efforts tangible—and edible:
On Tuesday afternoon, to thank congressional staffers for all they do on behalf of the fast food industry, franchisees hosted their annual reception at the Rayburn Office Building on Capitol Hill, a free food giveway in which staffers and interns gorged themselves on unlimited free Taco Bell tacos and nachos.

Workers at the event, which packed two rooms, said they gave away some 6,000 tacos in all.

What's Taco Bell looking for from Congress? Like the rest of the fast food industry, it's nervous about the National Labor Relations Board's decision to hold McDonald's responsible for how workers are treated in McDonald's restaurants, and glad that congressional Republicans are talking about blocking the NLRB on that. Additionally:
Earlier this year, the House of Representatives passed a bill to change the cutoff for defining a full-time employee under the new health care law from 30 to 40 hours, a change that would relieve many franchisees from having to provide health insurance to their workers.
Sounds like a fair trade for 6,000 tacos, amiright?
Game action in Pittsburgh during a Pittsburgh Steelers (black/yellow) vs. Tampa Bay Buccaneers (white/red) National Football League game on December 3, 2006. Players depicted include: (Steelers #99) Brett Keisel; (Steelers #51) James Farrior; (Steelers #2
A federal judge has approved a settlement for NFL concussion lawsuits after years of wrangling:
The settlement is designed to provide payments of up to $5 million to players who have one of a handful of severe neurological disorders, medical monitoring of all players to determine when or if they may qualify for a payment and $10 million for education about concussions.

The landmark deal was originally reached in August 2013, but Judge Anita B. Brody twice asked the two sides to revise their agreement, first to uncap the amount of damages that can be paid for diagnosable conditions and then to remove the limit on how much can be spent on medical monitoring.

Some 200 former players have opted out of the settlement and will pursue their cases in court. There's also debate over whether the list of conditions covered in the settlement includes all of the concussion-related health problems players may face.
Striking federal contract workers, April 22, 2015.
Contract workers in federal buildings once again walked out and rallied with supporters on Wednesday as they continue pressing the federal government to raise employment standards. Workers in Senate office buildings joined the strike this time, with one, Bertrand Olotara, writing:
Every day, I serve food to some of the most powerful people on earth – including many of the senators who are running for president: I’m a cook for the federal contractor that runs the US Senate cafeteria. But today, they’ll have to get their meals from someone else’s hands, because I’m on strike.

I am walking off my job because I want the presidential hopefuls to know that I live in poverty. Many senators canvas the country giving speeches about creating “opportunity” for workers and helping our kids achieve the “American dream” – most don’t seem to notice or care that workers in their own building are struggling to survive.

Sen. Bernie Sanders (I-VT) joined the protest. Workers are calling for President Obama to build on his executive orders calling for federal contractors to pay a $10.10 minimum wage and obey labor laws. They want to see a new executive order giving preference to "model employers"—contractors that pay $15 an hour with benefits and allow collective bargaining.
Staff photo of the Gravity Payments team
Remember Dan Price, the CEO who cut his own pay to raise the minimum annual pay at his company to $70,000? Turns out, that wasn't just a morally good thing to do, and Price doesn't have to wait for the longer-term payoff of increased productivity and reduced staff turnover—he's seeing an immediate payoff for Gravity Systems, his credit card processing company:
Price said the news has brought in dozens of new clients, making it the best week for new business in the company's 11-year history.

The firm has about 15,000 clients and handles about $10 billion in payments every year.

If the burst of new clients continues, it could create new jobs—new good jobs—and let other businesses know that treating workers well can pay off. But it's important to remember that workers shouldn't have to get lucky with an amazingly good boss to make a decent living and be treated well. Good bosses go viral, but for more workers, this is the reality:
While Price is cutting his own pay, most chief executives are continuing to see hefty compensation hikes. CEO pay rose more quickly in 2014 than in other recent years, with median compensation rising 6.9 percent to $12.2 million, according to The Wall Street Journal.

Meanwhile, American workers have been suffering from stagnating and, in some cases, declining wages.

That's a reality we need to fight to change.
PICO RIVERA, CA OCTOBER 4, 2012 - Walmart employees strike out side of a Walmart store in Pico Rivera, California on Thursday October 4, 2012. The employees accuse Walmart of unlawful retaliation against workers who speak out for change at the company. Th
Workers strike at the Pico Rivera Walmart, October 2012.
Walmart workers in Pico Rivera, California, are asking the National Labor Relations Board for an injunction against the company's decision to close its store there for six months. Walmart claims that the Pico Rivera store, along with four others in California, Florida, Oklahoma, and Texas, is being closed for plumbing repairs. The Pico Rivera workers and the labor group OUR Walmart say it looks awfully suspicious that the closures just happened to hit a store that's been a center of worker organizing, and they're claiming retaliation:
The United Food and Commercial Workers International Union, which backs OUR Walmart, is listed as the filing party on the NLRB complaint, which claims that Wal-Mart targeted the Pico Rivera store because it has been “the center of concerted action by [workers] to improve wages and working conditions for all Walmart [workers] around the country.” The Pico Rivera store was the site of OUR Walmart’s first strike in 2012; workers at that location have participated in strikes and civil disobedience ever since.
Walmart claims 100 or more plumbing problems at each of the stores that have been closed, but rather than getting as much prep work done for the repairs before taking the unusual step of closing stores, the company hasn't yet gotten permits for the repairs. Still, with five stores closed, it will likely be difficult for the Pico Rivera workers to prove that Walmart's action was directed at them.
Olive Garden restaurant sign
Fast food isn't the only part of the restaurant industry where workers are seriously underpaid. A recent report from the Restaurant Opportunities Centers United shows that many workers in full-service restaurants are also paid so little that they need and get nearly $9.5 billion in public assistance each year. And as in fast food, we're talking about large, profitable chains: Darden, the parent company of Olive Garden, LongHorn Steakhouse, Capital Grille, and more; Dine Equity, the parent company of IHOP and Applebee's; Bloomin' Brands, the parent company of Outback Steakhouse, Carraba's Italian Grill, and more; Brinker International, the parent company of Chili's; and Cracker Barrel. Workers at these five chains need an estimated $1.4 billion from programs including the Earned Income Tax Credit, Medicaid and the Children's Health Insurance Program, the Supplemental Nutrition Assistance Program, and heating and housing assistance.

These five companies spend millions on lobbying—with one key priority being to keep the tipped worker minimum wage at $2.13 an hour, where it's been stuck for decades. Meanwhile:

Graph showing the hundreds of millions in public assistance going to workers at top five full-service restaurant chains and table showing profits and CEO pay of those companies.
The ROC report frames public assistance to workers at these restaurant chains as taxpayer subsidies for the chains' low wages; it's a powerful argument, but one that the respected economist Arindrajit Dube is arguing doesn't hold up as applied to programs that aren't tied to labor force participation or hours worked.

I'm not sure I'm 100 percent on board with Dube's argument, but in any case we don't need the taxpayer subsidy argument to see the hundreds of millions of dollars in public assistance needed by workers at these profitable chains as an indictment of their wages and labor practices. It's as simple as this: If a profitable company is paying its workers hundreds of millions of dollars a year less than they need for the most basic medical care, food, and housing, that company is a driving force in the low-wage economy. You don't need to believe that the public assistance going to their underpaid workers is a direct subsidy to the companies to see something wrong with that.

Chart showing declining union membership against the share of income going to the middle 60% of families.
Oh, look. Another chart showing how declining union membership goes hand in hand with the declining strength of the middle class. Shall we look at some more specifics?
  • Collective bargaining raises the wages and benefits more for low-wage workers than for middle-wage workers and least for white-collar workers, thereby lessening wage inequality.
  • Collective bargaining also raises wages and benefits more for black, Asian, Hispanic, and immigrant workers, thereby lessening race/ethnic wage gaps.
  • The decline of unions has affected middle-wage men more than any other group and explains about three-fourths of the expanded wage gap between white- and blue-collar men and over a fifth of the expanded wage gap between high school– and college-edu­cated men from 1978 to 2011.
  • The states where collective bargaining eroded the most since 1979 had the lowest growth in middle-class wages and the largest gap between rising productivity growth and middle-class wage growth.
Continue reading below the fold for more of the week's labor and education news.
Continue Reading

Thu Apr 16, 2015 at 03:00 PM PDT

Daily Kos Labor digest

by Laura Clawson

You can add a private note to this diary when hotlisting it:
Are you sure you want to remove this diary from your hotlist?
Are you sure you want to remove your recommendation? You can only recommend a diary once, so you will not be able to re-recommend it afterwards.


Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site