Today’s News & Commentary — May 23, 2017

Companies in Utah are struggling to find workers to fill job openings thereby slowing economic growth. While companies are eager to hire more workers to meet increased demand, Utah’s unemployment rate of 3.1% means there are relatively few workers looking for jobs. Companies have begun raising wages to attract more workers; however, automation may also increase as a means to substitute for labor.

Connecticut Governor Daniel Malloy is trying to balance the budget with budget cuts and public-sector layoffs; however, the Service Employees International Union Local 1199 is airing an ad opposing this. The Union’s ad argues that rather than cutting services to the disabled or laying-off middle class workers, the Governor should consider higher taxes on the wealthy.

The Economic Policy Institute released a report finding that annually 2.4 million U.S. workers lose $8 billion because of minimum wage violations. Women, people of color, and youth are the most likely to report being paid less than the minimum wage. Although the U.S. Department of Labor’s Wage and Hour Division investigates such violations, the report’s authors note that it has limited staff and is thus unable to fully examine all minimum wage violations.

Michelle Russell with BCG and Lori Lepler with BRANDspeak have a piece in the Harvard Business Review explaining the importance of high-quality apprenticeship programs. They find that such programs led to a 22-percentage-point rise in promotions of female workers, a 5-percentage-point decline in attrition of female workers, and a 20-percentage point-rise in job satisfaction for female employees.



Gender Equality at Work Requires More Than Corporate Tokenism

Last month, a Fusion article warned women to beware of “the guy who talks a big game about gender equality… then turns around and harasses you, assaults you, or belittles you,” coining the term, the “woke misogynist.” The same warning can be made about corporate gestures toward gender equality. In an age where feminism is cool, it now takes more scrutiny to discern the genuine from the superficial. Many businesses are relying on their image as hip, progressive organizations to appeal to socially-conscious consumers by making statements about equal pay, donating to the ACLU, or appointing a handful of women to their boards. Yet, so many of these companies continue to foster systemic cultures of sexual disrespect, harassment, and assault.

Sex Discrimination in the Workplace

Multiple accounts of sexual harassment have recently come to light in the tech industry. Susan Fowler’s February blog post revealed the rampant sex discrimination and harassment she faced while an engineer at Uber. She recounted her experience with the HR department, which retaliated against her for making complaints and refused to take action against her “high performing” harasser. She says the number of women in the organization dwindled from 25% to 6% while she was there. Another survivor came forward with her account a few weeks later under the alias Amy Vertino, detailing similar backlash for reporting the sexist behavior of her colleagues. She reports Uber CEO Travis Kalanik “is well known to protect high performing team leaders no matter how abusive they are to their employees.”

Sex discrimination in employment is not unique to Uber. The tech industry averages 21-22% female employees. 60% of women in tech report being sexually harassed in the workplace. The hostile environment both creates barriers for women entering the tech industry and also causes them to leave the field at alarming rates, 45% higher than men. After reading Fowler’s blog, The Observer reached out to women in tech and, within a few hours, had twelve more personal accounts of workplace sexual harassment. Allison Esposito, the founder of Tech Ladies, said they hear similar stories at least once a week. A female engineer recently filed a lawsuit against Tesla for failure to take action against the pervasive harassment. TechCrunch conducted a number of anonymous interviews that further evince the rampant mishandling of sexual harassment complaints in the industry.

Even beyond tech, the core issue is that sexism pervades male-dominated industries. The culture reflects the leadership, and as Rachel Bitte, chief people officer at Jobvite, explains, “tech is the newest industry to see male dominance in leadership roles, but we saw the same sort of problems that resulted in lawsuits decades ago in industries such as manufacturing or mining.”

The financial industry is also struggling to increase diversity and address discrimination. 25% of companies on the Russell 3000 index have no women on their boards. According to an SEC report of Fortune 500 companies, women and minorities held 30.8% of corporate board seats in 2016, which the Alliance for Board Diversity criticized as not moving fast enough. Increasing board diversity requires planning, they counseled, given that the board is often a reflection of the lack of diversity in the rest of the company.

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Women & the Gig Economy: Flexibility in a Vacuum Just Isn’t Enough

The percentage of women in the U.S. workforce has been dropping since 1999. Whether it’s due to the lack of paid leave and family friendly policies, or for other reasons entirely, each year, women decide the traditional workplace simply doesn’t fit their needs.

Enter the gig economy!  Service apps like Uber, AirBnB, or Postmates and online sales platforms like Etsy and Ebay advertise as a pro that their workers maintain complete independence over their schedules.  On its face, the gig economy seems like the perfect fix to the flexibility problem driving many women out of the workforce.  After all, women have been selling Mary Kay, Pampered Chef, and other products from home for years.  Can’t work 9-5?  Drive Uber whenever you have free time.  Childcare too expensive to work outside the home?  Rent out your spare bedroom on AirBnB.  The reality, however, is that a version of the gender gap persists even in the most modern “flexible work” arenas.

Although there is an ongoing debate about employment levels in the gig economy, one study suggests that about 1% of U.S. adults earned income via the sharing or gig economy in 2015, an increase since 2012, when the percentage was something like 0.1%.   Moreover, A TIME study found that 22% of Americans (45 million people), 40% of whom are women, have sold some kind of good or service on the gig-economy.  However, about half of workers say these gigs account for less than 20% of their income, and use the platforms to earn money when income dips or when they are in between jobs.  In many instances, they’ve traded the social safety net provided to most 9-5 employees for flexibility and independence.

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Weekend News & Commentary — April 2-3, 2016

Only a few years ago, the prospect of a $15 minimum wage seemed laughable. Now, California has a graduated increase on the books, and New York may soon follow. Steven Greenhouse at the New York Times discusses how unions—even with historically low participation rates—convinced the people and politicians to support raising the minimum wage.

As economists battle over whether the higher wage will cause job losses, Lydia DePillis at the Washington Post says this is the wrong question. For DePillis and advocates of wage increases, the issue is not whether jobs will be lost, but what structures exist to support unemployed people. They contend that if the goal is to prevent job loss, then the minimum wage will always stay below a living standard. SEIU chief economist asked: “‘What should be the criterion about setting a minimum wage? Should it be the level which produces minimal job loss? Or should it be, in the language of the Fair Labor Standards Act, the maintenance of the minimum standard of living necessary for the health, efficiency, and general well-being of workers?’”

Workers in Elkhart, Indiana are not thanking President Obama, despite the success of his economic recovery plan in the region. The city’s unemployment rate is among the lowest in the country, and the auto industry bailout staved off up to150,000 auto jobs in Indiana. But many Elhart voters’ mistrust of big government and strong stances on abortion, gun rights, and same-sex marriage trumps the president’s efforts there. As the New York Times reports, “autoworkers are more apt to complain about the president’s gun proposals than to acknowledge the auto turnaround.”

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Today’s News & Commentary — March 30, 2016

If Chicago students arrive to teacher-less schools Friday, it won’t be an April Fools joke. The Chicago Teachers Union is preparing for a one-day strike with teach-ins and rallies, in response to alleged school closings, furloughs and layoffs next year. Through the walkout, the union intends to highlight its contract dispute with Chicago Public Schools as well push Illinois Governor Rauner to approve funding for public education and social service agencies, reports the Chicago Tribune.

Amidst a contentious election season, one political issue unites disgruntled voters: blaming economic woes on foreign trade. According to the New York Times, many voters think international trade deals have hurt American workers, and politicians’ rhetoric fans their flame. Economists accuse politicians of “following in the footsteps of politicians of all stripes who have found it convenient to blame the boogeyman of unfair trade for domestic economic problems.” But voters for both Trump and Sanders reflect a disappointment with the politicians’ and economists’ long history of “understat[ing] the costs of globalization, which tend to be more concentrated than the benefits.”

Trade deals like the Trans-Pacific Partnership made one meaningful difference this week, though. US Customs and Border Patrol seized a shipment of goods produced by forced labor for the first time in 15 years, which they could at last do because the TPP closed a loophole in enforcement mechanisms. Quartz explains that the TPP now prohibits goods made with forced labor from entering the US, even if they meet “consumptive demand.” China’s confiscated shipment of soda ash made by forced prison labor may be the first of many goods to now come under US scrutiny.

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Fuzzy Math: Silicon Valley’s Diversity Statistics

Many articles have been written about a diversity crisis in Silicon Valley, perhaps due to tech firms’ initial resistance to releasing employee demographics.  Enter Tracey Chou, an early Pinterest engineer, who launched a (still running) Google spreadsheet of the number of female hires.  Around the same time, several of the largest tech companies released diversity statistics from their Department of Labor’s EEO-1 reports, with several publications displaying side-by-side comparisons.  But if a picture (or chart) is worth a thousand words, then it’s important to understand what it does and doesn’t say.  In this post, I’ll focus on three ways employers can shift diversity stats from simply being self-congratulatory, to meaningful for potential employees deciding between firms.

The Atlantic points out:

It has become a grand gesture in tech this summer for big companies to release demographic data about their workforces…that formula has now become the de facto way to share (and apologize for) diversity data in Silicon Valley.  It goes something like this:

  1. Write a blog post about the importance of transparency, acknowledging how your company has a long way to go and outlining a few diversity-related initiative
  2. Include a sleek graph showing how few women and minorities you employ
  3. When asked to talk about the issue, decline interview requests and redirect people back to the original blog post

Diversity disclosure can help employees to pick the firm that is best for them, as disclosure is generally important.  But there’s a reason I say can, not will: data without context doesn’t mean very much.  Data’s potential power is in confirming individual “anecdata” as a trend.

Specifically, employees would benefit if employers provided baseline numbers, standardized and disaggregated their data.

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Pay Transparency at Work: The Great Equalizer?

“Pay secrecy fosters discrimination and we should not tolerate it.”

So declared President Obama in the Spring of 2014 upon signing an executive order ratcheting up punishments for federal contractors that maintain pay secrecy policies.  Two years on and legislators in dozens of states are following the President’s lead by introducing policies that would crack down on employer retaliation against workers who discuss their pay.

But is President Obama right?  Does pay secrecy “foster discrimination”?  Last week Alexa Kissinger provided a fantastic overview on this blog of the many possible connections between pay secrecy policies and gender inequality.  And indeed the stories from Hollywood and elsewhere certainly buttress the claims of those who believe transparency is a potent tool to reduce gender inequality.  Lilly Ledbetter provides another piece of evidence.  Ledbetter was a longtime manager at Goodyear Tire & Rubber.  Company records revealed that Ledbetter’s pay was substantially lower than men occupying similar positions at the firm.  It took her years to discover the discrepancy, due to a complete lack of transparency regarding wages and salary rates at the company.

Pay secrecy policies refer to workplace rules, informal or formal, that ban or strongly discourage workers from discussing wages or salaries.  The flurry of legislative activity surrounding them obscure the fact that the implementation and maintenance of a pay secrecy policy is already illegal.  Courts have consistently ruled that discussion about wages is considered concerted activity, and protected under the National Labor Relations Act (NLRA).  But, falling as it does under the NLRA, the penalties for violating this law and maintaining pay secrecy policies amount to little more than back pay and reinstatement. Hence all the recent attention.

And, as Kissinger highlights, it is not as if only a small slice of the American workforce is subject to these policies.  As the Institute for Women’s Policy Research has documented, approximately half of American workers report being subject to a pay secrecy policy of some sort.  Pay secrecy policies are illegal, incredibly commonplace, and may help explain gender inequality at work.

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