• Daily Digest

    Daily Digest - June 19: No Grocery Money, No Problem?

    Jun 19, 2013Rachel Goldfarb

    Click here to receive the Daily Digest via email.

    What Congress and the Media Are Missing in the Food Stamp Debate (The Nation)

    Click here to receive the Daily Digest via email.

    What Congress and the Media Are Missing in the Food Stamp Debate (The Nation)

    Greg Kaufmann asks why we are talking about everything except the state of hunger in the U.S. when we talk about cutting SNAP benefits. There are people in this country who cannot afford enough food for themselves and their families: as he sees it, nothing else should be considered.

    Kansas Bleeds the Middle Class (TAP)

    Monica Potts visits Johnson County, Kansas, where she finds that suburban poverty is growing and there are no middle-class jobs available. This low-wage economy is a constant struggle, and there don't seem to be any escape routes in place.

    Welfare reform took people off the rolls. It might have also shortened their lives. (WaPo)

    Dylan Matthews reports on a new study on a Floridian precursor to federal welfare-to-work programs, which shows a troubling statistically significant difference in the mortality rate of the work program participants. More research is necessary, but it's possible welfare-to-work created new health problems.

    Unelected Emergency Manager Preparing To Break Detroit’s Pension Promises (ThinkProgress)

    Alan Pyke explains how bankruptcy proceedings would allow the emergency manager to put paying investors who gave the city loans before paying retirees. Investments are supposed to come with risks, but fixed-income seniors are apparently less important than debt.

    The Chart That Eviscerates Five Terrible Talking Points About Taxes (Business Insider)

    Josh Barros uses this chart on the progressivity of our tax system to remind us to think about how the whole system fits together, particularly when considering issues like the so-called "47% percent” or the progressivity of specific taxes.

    We Need a New Deal For Millennials (HuffPo)

    Richard Eskow argues that Millennials need to run far away from the politics-as-usual that is destroying their future. Instead, he would see a return to real values in politics, starting with the Millennials running for office themselves.

    Guitar Center: Prices So Low, Employees Can't Survive on Wages (The Nation)

    Allison Kilkenny reports that the 57 retail workers at Guitar Center's flagship in Manhattan have overwhelmingly voted to form a union. Their demands are pretty reasonable: a living wage, with a commission structure that makes sense in the Internet age.

    Former intern sues Atlantic Records (Salon)

    Christopher Zara explains this lawsuit, in which a former intern is suing to recover minimum wage and overtime with the help of the organization Intern Justice. This follows last week's ruling that some Fox Searchlight internships are illegal.

     

    Read more

    Share This

  • What Will Obamacare Mean for the Low-Wage Work Crisis?

    Jun 18, 2013Richard Kirsch

    New health insurance marketplaces will make affordable care accessible to millions, but low-wage employees of big businesses may be left out.

    One of the biggest issues that the Affordable Care Act (ACA) is meant to tackle is the lack of health coverage among low-wage workers. While there is good news for many low-wage workers in the new law, many others will still find themselves locked out of access to affordable coverage. Solving their concerns will be one more part of the huge challenge of confronting the power of mammoth low-wage employers in the new economy.

    New health insurance marketplaces will make affordable care accessible to millions, but low-wage employees of big businesses may be left out.

    One of the biggest issues that the Affordable Care Act (ACA) is meant to tackle is the lack of health coverage among low-wage workers. While there is good news for many low-wage workers in the new law, many others will still find themselves locked out of access to affordable coverage. Solving their concerns will be one more part of the huge challenge of confronting the power of mammoth low-wage employers in the new economy.

    There has been a lot of coverage about the potential for fast food chains and other employers to cut the hours of some of their employees to under 30 a week in order to avoid having to offer them health coverage. To the extent that employers do cut back hours, it will accelerate a long-trend toward part-time low wage work; part-timers increased from 17 percent to 22 percent of the workforce just from 2007 to 2011.

    The surge in part-time work is one aspect of the broader increase in low-wage work. Most of the jobs coming out of the recession are low-wage, which has hastened a trend going back 30 years of a growing number of low-wage jobs with no health benefits. The powerful eroding of good jobs is the greatest threat to broadly-shared economic prosperity. It destroys any promise of people living a middle-class life style, creates a two-tiered society, and undercuts the consumer buying power needed to move the economy forward.

    The low-wage economy means more than just low wages. Post-World War II jobs, which came with employer-provided health coverage and a pension, are fast disappearing. Now more than four-in-ten workers do not get health coverage on the job. This includes many employees of small businesses, which do not offer any health coverage. It also includes millions of employees of large businesses, who either are not offered health coverage or can't afford the premiums.

    Enter Obamacare. The good news in the ACA for low-wage workers who work for small employers (those with fewer than 50 full-time workers) is that many will have access to affordable health coverage for the first time through the new health insurance marketplaces. They will be able to sign up for subsidies that limit how much they pay in premiums to a percentage of their income and get plans with good benefits and moderate out-of-pocket costs. Those with incomes below 133 percent of the federal poverty level (about $15,000 for an individual) will be eligible for Medicaid in states that agree to expand coverage.

    But for those who work for bigger employers – and some two-thirds of minimum wage jobs are at employers of 100 or more – it is not clear whether the ACA will deliver on its promise of affordable coverage. Ironically, part-time workers may come out ahead, with a much better chance of affordable coverage, while full-time low-wage workers may find coverage out of their financial reach.

    Millions of people who don’t work more than 29 hours a week for any one employer will be eligible for affordable subsidized coverage through the new marketplaces. And even if employers trim back some workers' hours to get below the 30-hour mark, those workers may end up better financially and gain affordable coverage for the first time.

    There will also be some employers who increase the hours of part-time workers to above 30 a week, as the Cumberland Farms stores, which employ 4,500 full-time workers and 2,700 part-timers, plan to do. Noting that  full-time workers stay with the business three to four times longer than part-timers, the Cumberland Farms CEO explains, ““Longer-tenured workers deliver a better experience for the customer.” According to the payroll-processing firm ADP, other businesses are also likely to encourage more workers to become eligible for employer coverage.

    But it is not at all clear that full-time low wage workers for bigger employers will be able to get affordable coverage. That is because the big business lobby exercised its muscle in shaping the ACA in the Senate Finance Committee. All the law requires is that employers offer individual employee health coverage that does not cost more than 9.5 percent of an employee’s income in order for the business to escape paying a $2,000-to-$3,000 penalty. In addition, the ACA allows employers to offer plans with very high out-of-pocket costs.

    Make no mistake about it; 9.5 percent of wages is a lot for anyone to pay for health insurance, and it is a huge amount for low-wage workers. By comparison, an employee who makes $12 an hour and works a 35-hour week would pay about 6 percent of his or her income on health insurance in the new marketplaces, for coverage which is almost certain to have better benefits and lower deductibles and co-payments.

    And here’s the kicker: as long as a worker is offered the less-than-9.5-percent-of-income coverage at work, that worker is not eligible for the much better coverage in the marketplace. And if the worker decides that she can’t afford the premiums, she will be have to pay a penalty for not being insured.

    The big outstanding question is, what will the bigger low-wage employers do? They could choose to offer affordable coverage to their employees. But the big fast food chains, retail giants, and box stores have a history of offering several levels of coverage to their employees, including bare-bones plans targeted at their lowest paid workers.  

    Putting this all together, here is what health coverage for low-wage workers may look like after a couple of years of implementation of Obamacare: good coverage for those who work for smaller businesses and who don’t work more than 29 hours a week for any one employer, but either no coverage or coverage that is costly to buy and to use for many people who work more than 30 hours a week for the biggest low-wage employers in the country.

    Seen in this light, Obamacare is one more step toward both improving and exacerbating the low-wage work crisis in the nation. The movement away from employer-provided health coverage is a huge step forward in creating a more just health care coverage system. But justice for low-wage workers at big businesses will mean confronting the power of companies like WalMart, McDonald's, and Bank of America (with its low-wage tellers). This is the same challenge we face in taking the other steps needed to modernize labor standards for the 21st Century: a higher minimum wage indexed to inflation, paid sick days and family leave, and overhauling labor laws so that workers’ rights to form unions is restored. It is fast becoming central to the fight for a new economy that works for all Americans.

    Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform

    Read more

    Share This

  • Daily Digest

    Daily Digest - June 18: The Hunt for Good Jobs Continues

    Jun 18, 2013Rachel Goldfarb

    Click here to receive the Daily Digest via email.

    “This was really eye-opening for me”: Fed’s Raskin Shocked at Low Quality of Work at Local Job Fair (Reuters)

    Click here to receive the Daily Digest via email.

    “This was really eye-opening for me”: Fed’s Raskin Shocked at Low Quality of Work at Local Job Fair (Reuters)

    Pedro da Costa notes that Sarah Bloom Raskin's comments at A Bold Approach to the Jobs Emergency on June 4th were surprisingly personal. Raskin's trip to the job fair helped her to understand just how difficult things are in today's job market.

    Minimum Wage: Catching up to Productivity (Democracy)

    John Schmitt suggests plans to increase the minimum wage so that low-wage workers get a piece of the pie from our massive productivity gains. Linking the minimum wage to CPI isn’t the solution, because that would just maintain the status quo.

    • Roosevelt Take: Watch John with Brink Lindsey, Ai-jen Poo, and Roosevelt Institute CEO and President Felicia Wong on the panel "Is Education the Answer?" at A Bold Approach to the Jobs Emergency.

    Dems Rebrand Minimum Wage, Sick Leave As Women's Issues To Pressure GOP (HuffPo)

    Laura Bassett and Dave Jamieson see these efforts as an intentional push against the GOP, since the Democrats have such large margins with women voters. By making economic issues into gender issues, they are already in the lead for voter approval.

    Florida’s Governor Signs Business-Backed Bill Banning Paid Sick Leave (ThinkProgress)

    Bryce Covert reports that Rick Scott has signed a bill that bans local governments from implementing paid sick leave legislation. Apparently Floridians are best served by bringing their infectious diseases to work.

    Walmart Bill Vote Bumped to Next Week; Cue the Lobbyists (Washington City Paper)

    Aaron Wiener writes on a D.C. City Council bill that would require large retailers whose workers are not unionized to pay a living wage of $12.50 per hour. Unsurprisingly, a Walmart spokesman doesn't like the exemption for organized labor.

    Volunteering Lifts Job Prospects of the Jobless (WaPo)

    Michael Fletcher reports on a federal study that provides data for something many have assumed: volunteering increases an unemployed person's chance of finding a job by 27%. For those without high school diplomas, who really struggle to find work, the effect is even greater.

    The Current U.S. Economy: Text and Subtext (NYT)

    Jared Bernstein thinks that the relatively positive IMF assessment of the U.S. economy requires annotation, which reveals the underlying struggles of the middle and lower classes and the problems with our current economic policy.

    Will the Robots Steal Your Paycheck? BREAKING: They Already Have (The Atlantic)

    Jordan Weissmann examines a study that shows that in countries where the cost of doing business has dropped, worker share of GDP fell as well. He argues that we need to consider how this change affects workers who are being replaced by technology.

    Read more

    Share This

  • Rediscovering Government

    The U.S. Lacks Good Jobs, Not Good Ideas

    Jun 17, 2013Jeff Madrick

    A Bold Approach to the Jobs Emergency brought together leading policymakers, thinkers, and activists to discuss how we can get the U.S. to full employment and create more good jobs, but that was only the beginning of the conversation.

    A Bold Approach to the Jobs Emergency brought together leading policymakers, thinkers, and activists to discuss how we can get the U.S. to full employment and create more good jobs, but that was only the beginning of the conversation.

    Our jobs conference in early June covered a wide variety of potential solutions to what we call the jobs emergency, from major macro policies to local activist ones. Given how little is done in Washington to solve the problem, it is stunning how many good ideas are out there.      

    Senator Tom Harkin, who has sponsored the most comprehensive jobs bill in Congress, set the stage with a keynote address that made no bones about it: we are not creating enough good jobs in America -- not by a long shot. Perhaps his key point of many was that we don’t have to choose between closing the budget deficit and making goods jobs. “Smart policies designed to reduce unemployment will also act to reduce the deficit,” he said. If we grow, create goods jobs that pay high wages, and encourage investment, the deficit will also fall, as it always has before when economies recovery strongly. It’s a win-win.

    But Washington is stymying progress. That's why, he said, we must end the filibuster.

    Alan Blinder, former vice chairman of the Federal Reserve, assured us there is no deficit problem for the next 10 years, so we shouldn’t be focusing on it. Several of our macroeconomists called for much more fiscal stimulus.

    One cause of job deficits may well be Wall Street itself. Damon Silvers of the AFL-CIO talked about how Wall Street has misdirected investment from productive uses. Rosemary Batt of Cornell University discussed how privatization puts downward pressure on wages and jobs. Bill Lazonick of the University of Massachusetts Lowell stressed how cash-rich companies use money to buy back shares rather than invest in America.

    Participants in the conference talked about creating jobs through infrastructure investment, community investments, and outright job creation by the federal government a la FDR. Others discussed the need to raise labor standards and enforce the existing labor laws.

    Local activists offered refreshing perspective. Maya Wiley of the Center for Social Inclusion said we must not think that one-size-fits-all solutions are good enough. We have to bore down to the particulars. Ai Jen Poo wondered why we have so many unemployed when we have so many needs. For example, there is a desperate need for adequately paid care workers. Why can’t we get supply and demand to come together?

    And Federal Reserve Governor Sarah Bloom Raskin told us of her disappointing experience at a local jobs fair, where she saw the poor quality of jobs being offered. She asked the room why so many poor jobs were being created, and how long will this go on.

    Congresswoman Jan Schakowsky, who also had a job creation bill before Congress, summed up the issue. “This is the seminal battle of our time," she told the conference. “A battle for our economy, a battle for fairness, a battle for the heart and soul of our country. This is a battle that has to be waged all around the country.”     

    We at Rediscovering Government will make the jobs emergency our number one priority. Videos of the conference panels and keynotes are now available on our web site. We will also publish transcripts and eventually produce a book on the best jobs ideas in the country. We will provide background papers on policy proposals we make. Everyone in the nation should have a decent job if he or she wants one. As far as we are concerned, it’s one of our inalienable rights.

    Roosevelt Institute Senior Fellow Jeff Madrick is the Director of the Roosevelt Institute’s Rediscovering Government initiative and author of Age of Greed.

    Read more

    Share This

Older Posts