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.



Today’s News & Commentary — May 16, 2017

Noncompete agreements — once limited to senior executives — are now a widespread practice, locking in almost one fifth of American workers.  This includes low-wage workers at fast-food chains and factories.  A recent report from The New York Times revealed how such agreements can harm workers, preventing them from finding new jobs or embroiling them in costly legal battles.  This morning, the Editorial Board called for an end to “such morally dubious practices.”  It pointed to California  — where state law makes noncompete agreements generally unenforceable — as one potential blueprint for reform.

Waymo has scored a big win in its lawsuit against Uber.  Yesterday, a federal judge granted a preliminary injunction, barring one of Uber’s star engineers — who is accused of stealing trade secrets — from working on its self-driving car program for the duration of the litigation.  Wired has more.

Ford is cutting jobs, Reuters reports.  The auto manufacturer plans to shrink its salaried workforce in North America and Asia by as much as 10%, in a move that could attract the ire of the Trump administration.  President Trump has promised to expand jobs in the auto industry — earlier this year, he took credit for Ford’s decision not to shift its manufacturing plants to Mexico — but this most recent announcement (which will likely affect thousands of American workers) is a serious setback.

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Canada’s Chance to Get Marijuana Legalization Right for Workers

During prohibition, one of Al Capone’s liquor suppliers was a young Canadian named Samuel Bronfman. A Jewish immigrant whose family fled czarist Russia, Bronfman started his rum-running career as the owner of a small hotel and mail-order whiskey distributor. Then, prohibition hit. Instead of destroying Bronfman’s business, prohibition was a boon – he set up “export houses” along the border between Saskatchewan and North Dakota, partnering with criminal organizations like Capone’s to smuggle his product, and reaped the profits. But in 1922 Bronfman’s brother-in-law was killed, allegedly by gangsters, and Bronfman took it as a cue to leave the illegal trade. His family moved to Montreal and built up their legal business inside Canada, only re-opening their U.S. sales once prohibition ended. When Bronfman died in 1971, he was a multi-millionaire and the owner of Seagram Co. – the biggest producer and distributor of alcohol in the world. In a country humble about its own historical figures, Bronfman’s story is told with a rare romance and nostalgia. His is the legend of the plucky upstart, a self-made man who took opportunity as it came.

What made Bronfman’s story possible? In part, it was that no one held his past actions against him. In fact, he profited off of them, in terms of money, experience, and respect.

In 2018 Canada will become the second country in the world to end a different kind of prohibition—that of marijuana. This time around people who, like Bronfman, participated in the illegal trade of the substance will have a much harder time breaking into the legal market. That is because Canada’s proposed law lets the government prohibit anyone with a drug-related criminal record from taking a leadership role in the industry. With this policy, the Government of Canada is erecting barriers to employment for poor people and people of color, who are not necessarily more likely to sell or use marijuana, but are more likely to be arrested—and therefore develop a criminal record—for doing so.

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Guest Post: The People’s Climate March and Labor

Renee Gerni is an Assistant General Counsel at the Service Employees International Union. The views expressed in this post are solely her own and should not be attributed to SEIU.

This past weekend, when hundreds of thousands rallied in the People’s Climate March, a significant number of the marchers were union members.  In fact, the labor movement has long been involved in the fight for environmental justice. For unions like SEIU, the strength of commitment to this fight has only increased in recent years as union members witness firsthand the immediacy of the climate crisis. The struggle over the Dakota Access Pipeline, and the effects of more frequent superstorms like Hurricane Sandy and Hurricane Katrina, evidence an unavoidable conclusion: environmental crises hit hardest and first poor communities and people of color.  Union members understand that environmental injustice is one of the most significant threats to the achievement of economic and racial justice for working families. Climate change is creating increased pollution, which is already affecting public health.  We know that one in six black children has asthma, as compared to one in nine children overall.  Black children are three times more likely to suffer asthma attacks that require hospitalization and twice as likely to die of asthma. This is no accident. Coal-fired power plants are the single biggest source of carbon pollution in the U.S. and are disproportionately located near (i.e. within three miles of) communities of color and low-income communities. This proximity exposes these communities — who too often lack the economic resources to prevent adverse health outcomes — to dangerous particulate matter and ozone precursors that cause and contribute to respiratory illnesses like pulmonary disease and lung cancer.

Weekend News & Commentary — April 29-30, 2017

Yesterday was the 100th day of the Trump presidency, and the report cards are in.  In an op-ed published in The Washington Post, President Trump maintained that he has “kept his promise[s]” to the American people.  He pointed to his achievements in curbing immigration and overhauling the United States’ trade relationships.  But there’s one area in which he has few concrete wins to show: jobs.  The White House website claims that the Trump administration has created “over 500,000 new jobs” — but the number is probably closer to 300,000, and it’s far from clear whether Trump can take credit for those, according to NPR.  The Washington Post looks ahead to what the President’s next steps will be, as he tackles tax reform with the hopes of stimulating job growth.

New research has confirmed what has long been suspected: income inequality reduces economic opportunity.  In a new paper published in Science, Stanford economist Raj Chetty tracked rates of income mobility since the 1940s, finding a distinct downward trend: whereas 90% of children born in 1940 earned more than their parents at the age of 30, only 50% of children born in the 1980s have done the same.  In the face of widening income disparities, the American dream could be “fading.”  Read the accompanying essay from economists Lawrence Katz and Alan Krueger here.

Are women allowed to love their jobs?  That’s the question that Jill Filipovic tackles in The New York Times this weekend, reflecting on a culture that values work as a crucial component of male identities, but “remains ambivalent about whether adult women working . . . is a good thing.”  She suggests that, until this attitude changes, workplace reforms for women — however much needed — could be slow to materialize.

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Today’s News & Commentary — April 17, 2017

Why don’t all jobs matter? The provocative question is posed by Paul Krugman in today’s New York Times. Krugman questions why so much focus is on mining and manufacturing jobs, when the service sector—a much bigger slice of the economy—is dwindling. He points to several possible reasons, though complicates them all: the importance of mining jobs to local economies, the “political footballs” they have become, and the fact that miners and manufacturers tend to be white and male. Krugman ultimately concludes that saving jobs that are being lost may not be the smartest tack; instead, we should be investing in reeducation and guaranteeing benefits like health care.

Dylan Matthews of Vox summarizes a number of ideas—inspired largely by Europe—for how to save unions. First, unions could be organized on the sector level instead of on the company level, so all workers in a particular industry are affected. With less cross-company labor competition, the argument goes, businesses will be less union-averse. But how do you avoid the “free rider” problem, where, as in France, nearly every worker is covered by a collective bargaining agreement but fewer than 10% of workers are actually in unions? Some countries, like Denmark and Finland, have systems where unions run unemployment insurance, increasing the contact between the labor organizations and possible members. As Professor Sachs notes in the piece, however, such a change might be very tough during the Trump years.

Fast Company Co.Design covers a recent report by the Center for Business and Human Rights at NYU Stern School of Business on migrant workers. The report highlights how many of these workers end up paying to work: agents and recruiters require trumped-up fees and many workers end up dishing out extra for airline tickets and other documents. As the piece notes, “When you finally get to work, you might already owe a year’s worth of wages.”

A Truly Green Economy

President Trump has already declared his intention to go down in history as the “greatest jobs producer God ever created.”   He has promised to create 25 million new jobs by 2027.   Since taking office, Trump has made clear that two of the industries he plans to focus on for job creation are coal and manufacturing. Trump has cited his belief that American manufacturing and coal industry jobs are the “backbone of our economy” as the impetus behind his focus on revitalizing these types of jobs.  Now that he’s in office, he is increasing his efforts to revitalize these struggling sectors.  However, Trump is operating in a myopic state that ignores the need for American workers to shift to jobs into emerging sectors, particularly sectors that are relatively more resistant to automation than are manufacturing jobs.

Manufacturing jobs have declined as a percentage of the U.S. workforce while overall U.S. manufacturing output has increased.  The loss of jobs points as much to automation as it does jobs moving to less expensive markets like China or Mexico.   Jobs in coal are likely to continue to disappear as they have been for the last 30 years as a result of alternative, cleaner and affordable fuels entering the market. Instead of – or, at least in addition to – focusing on struggling industries, Trump should look to ease job creation in emerging industries.  One such industry that is steadily on the rise was recently flagged as one that his administration may look to quash: legalized marijuana.

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