Weekend News & Commentary — July 18–19, 2015
Employment continues to rise in California. The Los Angeles Times reports that employers added 22,900 nonfarm payroll positions in June, bringing the state’s unemployment rate to 6.3%. Nationally, the unemployment rate stands at 5.3%. Although California’s housing shortage and high housing prices are outpacing income growth — which could slow down the economy — the outlook remains positive. According to Mark Schniepp, director of the California Economic Forecast, 2015 looks like it will be a “stellar year” for employment.
Earlier this week, the Equal Opportunity Commission held that workplace discrimination on the basis of sexual orientation violates Title VII of the Civil Rights Act of 1964. The commission, voting 3-2 along party lines, concluded that although Title Vii does not explicitly prohibit discrimination against gays and lesbians, “an allegation of discrimination on the basis of sexual orientation is necessarily an allegation of sex discrimination.” The decision was not widely publicized, but “it quickly drew attention among advocacy groups and legal experts,” and has now been picked up by the New York Times.
Despite her previous support for the nationwide Fight for $15 movement, Hillary Clinton, in response to a question from BuzzFeed News, declined to support a $15 national minimum wage. Instead, she said that she supports “the local efforts that are going on that are making it possible for people working in certain localities to actually earn 15.” She added, “I think part of the reason that the Congress and very strong Democratic supporters of increasing the minimum wage are trying to debate and determine what the national floor [should be] is because there are different economic environments. And what you can do in L.A. or in New York may not work in other places.” According to Politico, Clinton’s statement “reaffirmed a clarification” that a press aide made after Clinton’s comments about the Fight for $15 movement in June.
Meanwhile in Greece, some young entrepreneurs are attempting to build their own businesses. The New York Times explains how a fledgling start-up culture in Athens is “providing a glimmer of hope for the economy and [the younger] generation even as Greece girds for more budget austerity and wrenching regulatory changes.” The emergence of a handful of small-business incubators and co-working spaces, coupled with support by philanthropic organizations that have sponsored contests and awarded seed money to young Greek entrepreneurs, could lead the way to solving Greece’s problems — at least according to some experts.
At the Washington Post, Lydia DePillis explains why the collapse of Homejoy, a home cleaning startup, “is not a harbinger of doom for the on-demand economy.” Homejoy will be shutting down at the end of the month due to four lawsuits that accuse the company of misclassifying workers as independent contractors. Homejoy could face millions of dollars in penalties, and founder Adora Cheung said she couldn’t afford to convert her workers into employees. As DePillis writes, Homejoy’s failure could lead to the conclusion that “regulations — and the resulting litigation — are what’s strangling the on-demand economy” — but that conclusion would be incorrect. A number of other start-ups have classified their workers as employees from the get-go, and have been successful in doing so. Others, like Instacart and Shyp, started with contractors, but have now transitioned their workers to employees.
Lydia DePillis also reports that Kansas City has voted to raise its minimum wage to $13/hour by 2020. The only catch? The new minimum wage will not apply to those under age 18. Proponents of excluding teenagers from the ordinance justified it on the grounds that the exclusion will help teenagers obtain jobs and that most teenagers are just “trying to cover a cellphone bill, an auto payment,” and not support families. But those who fought the exemption argued, for example, that it could hurt older workers, as employers might choose to hire cheaper youngsters instead. Others pointed out that some teenagers do in fact need to provide for their families.