Some Friendly Advice for Workers from the Wall Street Journal

Last week the Wall Street Journal published a piece examining the impacts of the economic slowdown on young workers, and found that young workers were at higher risk of becoming unemployed.

Employees in their 20s and 30s are finding themselves more at risk of a layoff, according to labor lawyers, as employers look to avoid age-discrimination lawsuits by adopting a “last one in, first one out” policy and turn to tenure as a means of conducting layoffs.

Fear not my friends; the WSJ ended this great piece with some friendly advice:

You might also try to align yourself with someone in senior management… Should it come to layoff decisions, “It doesn’t hurt to have someone in the executive conference room on your side”…

There you have it folks, we should be sucking up to management and owners across America… what do you say?

Well there is another way, one the WSJ doesn’t even bother telling you, it’s called the union way. That’s right, you can either give sucking up a try, or decide you and your co-workers should have a say about how things go down at work.

What can I get as a young worker in a union? The folks over at CEPR did some research and found that it’s actually quite a bit (PDF). Among their findings:

  • unionization raised wages 12.4 percent – or about $1.75 per hour relative to young workers with similar characteristics who were not in unions
  • About 17 percentage points more likely to have employer-provided health
  • About 24 percentage points more likely to have a pension.

Today I literally jumped up with joy when I read about workers in Manhattan who chose the union way. Last Friday workers at H&M ratified their first contract — maybe they forgot to read the paper last week?

From the NY Times Blog:

More than 1,000 employees at nine H&M stores in Manhattan will receive wage increases and other benefits in their first-ever union contract… The three-year contract provides a 3 percent wage increase in the first year, with wage re-openers in the second and third years. An additional merit-based increase is included in each year of the contract.

What’s so new or exciting about this? Well not sure when the last time you all went to H&M was, but a large part of those workers belong to a demographic which currently only makes up a small percent of the labor movement, young workers. What’s of particular interest to me is that this is definitely not an isolated event, in fact globally there is a growing activity by unions to reach out to young workers and organize them to improve working conditions. (Examples here and here).

I know we often hear about how we keep losing jobs to overseas competitors as a result of “free trade” policies like NAFTA (and I think that’s true), but what we can’t forget is that there IS an increasing job market out there in the service-oriented economy. Imagine what the country would look like if the current batch of mostly low-wage, part-time, and non-union service jobs were turned into high-paying, people-friendly, sustainable jobs that allowed folks to live a good life in their communities. Is this too much to ask for? The H&M workers certainly didn’t think so, and they are right. We can’t give up on the jobs we have. Let’s turn them into good jobs.

For that to happen we will need some basic things to change, first among them bringing an end to the corrupt system workers have to face when trying to organize unions. We can do that with the Employee Free Choice Act, check out the video to learn more about it and get involved.

Spending for a Rainy Day

by Lynne Bolton—Minnesota

It had been raining on and off in South Minneapolis, and by about 6 pm I hadn’t had much luck yet — forget about getting any dues-paying members, folks weren’t even interested in listening to who I was. I was down near Minnehaha Creek, when the rain really started to pick up. I knocked on the door and a woman in her 40′s answered it. Inside were 4 kids all waiting for dinner as their frazzled mom listened to me give my rap. I was trying to be quick, as the kids were all trying to get her attention as well.

She told me that her big concerns were health care and jobs, as her husband (who did consulting IT work) had lost his big client, and she was staying at home with the kids. After I was finished, she said she wanted to give, but couldn’t do that much. I told her to give what she was comfortable with, and she contributed $60 – saying that she wished it could be more, because the issues were so important – to her, but also to everyone.

I left and went back into the rain, feeling better about what I was doing, and knowing I was appreciated.

Economic Snapshot: Some Numbers

CNBC’s headline makes things sound pretty rosy: “Durable goods in surprise jump; jobless claims dip.” And there is some good news:

New orders for long-lasting manufactured goods saw their biggest gain in 16 months in April and fewer workers filed for new jobless benefits last week, according to official data on Thursday that suggested the deep recession was abating.

But if you look past that opening, it’s not all sunshine. A few paragraphs down we get this sobering fact (as if we weren’t sober enough thinking about the economy these days):

However, the number of people staying on benefit rolls after drawing an initial week of aid increased 110,000 to a higher-than-forecast 6.79 million in the week ended May 16.

Calculated Risk looks into it, and 6.79 million continued unemployment claims is not just higher than forecast, it’s an all-time record as a raw number. At 5.1% of covered employment, this is not a record as a percentage—in 1975 it hit 7%–but it’s not exactly a good thing, either. Calculated Risk’s take is that “There is a reasonable chance that claims have peaked for this cycle, but it is still too early to be sure, and if so, continued claims should peak soon.”

We don’t just have to worry about unemployed workers, either. Underemployment is a real problem, as the Washington Independent details in a must-read article:

“The number of people under economic stress is much bigger than the official unemployment rate,” said Chad Stone, chief economist at the Center on Budget and Policy Priorities. Who are these people? The Bureau of Labor Statistics takes a stab at quantifying these people to create a more comprehensive picture of who’s not working and why not. The Bureau identifies categories of Americans it labels as “marginal,” meaning that they are unemployed and have looked for a job in the past, but not recently, and “employed part time for economic reasons,” referring to workers who would take full-time schedules if they could. Once these groups are added to the base unemployment rate, the number climbs all the way up to 15.8 percent in April, the highest number since the BLS began tracking these sub-groups in 1994.

Yet there are some who say even these numbers don’t tell the whole story. Progressive think tanks talk about “skill underemployment.” “It’s the computer engineer who lost [his] job and is now working at 7-11,” said Heidi Shierholz, an economist with the Economic Policy Institute. “They show up as employed, not as a bad labor market outcome,” she said. In reality, though, these workers, are both earning and contributing far less than their potential — one definition of underemployment. The labor bureau’s data-collection also doesn’t take into account the millions of Americans who have had their hours or wages cut in recent months.

And it’s not just the wages these underemployed people are earning right now that are at issue. They aren’t contributing as much to Social Security or to their private pension plans and they are far less likely to have health insurance, which means that underemployment can have an impact on people’s lives even for years after they return to full employment. (Of course, returning to full employment in this economy is difficult—in December, for every available job there were 4.1 people looking for work and it’s gone up since.)

Looking at another measure of economic health, Calculated Risk also reports that new home sales were flat in April, which “is the second lowest sales for April since the Census Bureau started tracking sales in 1963.” Again, their conclusion boils down to that the absolute worst may have passed, but on home sales, like unemployment, it will be some time before we see the kind of recovery that will reach throughout the economy to all of us.

The upshot is that while the cheery headlines about positive economic numbers aren’t wrong, we need to look more deeply.

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Reminder: Unemployment LifeLine

Don’t forget—Working America and the AFL-CIO have put together the Unemployment LifeLine, a one-stop resource center for jobless workers. It’s a guide that links workers to the resources in their area, from unemployment offices to veterans’ services to child care. It also offers the opportunity to talk to others and share lessons learned and support.

And every weekday, the Unemployment LifeLine’s “ask an expert” feature is up and running. Community services staffers with decades of experience are there to answer your questions about how to face the challenges of being unemployed. You go to the LifeLine’s forums and ask your question. It won’t take long to get an answer.

Why I’m a Community Organizer

by Elizabeth Holmbeck—Minnesota

One day while canvassing, I ran into a elderly fellow who lived alone with his dog named Pat. As I talked with him about the issues that we work on, he was silent. When I stopped, he told me I did a good job and asked me in for tea. He was delightful — he told me of his days as a young man going door to door as a traveling salesman some fifty years ago, he talked about his service in World War II, and we discussed the current times. He told me that at 85 years of age he had been dropped by the VA medical because there were too many wounded vets coming home from the current conflict. My heart went out to him as someone who had no family or friends around him in his age and now had no healthcare. He was so thankful for what we did and told me to keep up the good work — and that is what I do!

Interesting Things Around the Internet

  • Why does McAllen, Texas spend the second-most per person on health care among cities and towns in the United States?
  • The stock market goes down, unemployment goes up? A graph at Ezra Klein’s blog suggests so.
  • The case for working with your hands:

    The trades suffer from low prestige, and I believe this is based on a simple mistake. Because the work is dirty, many people assume it is also stupid. This is not my experience. I have a small business as a motorcycle mechanic in Richmond, Va., which I started in 2002. I work on Japanese and European motorcycles, mostly older bikes with some “vintage” cachet that makes people willing to spend money on them. I have found the satisfactions of the work to be very much bound up with the intellectual challenges it presents. And yet my decision to go into this line of work is a choice that seems to perplex many people.

  • Well, this is cheerful:

    The glut of unsold homes, fed by a new wave of foreclosures, could drag housing prices lower in the month ahead as the gap widens between supply and demand.

  • How’s this for an incendiary title? From La Vida Locavore, “Fast food makes you stupid (yet we serve it in our schools.”

Working Life in a Biscuit

The AFL-CIO’s Stewart Acuff brings us the story of a struggle going on right now in the Bronx:

Stella D’oro, which was once an iconic, national, premium Italian-style biscuit brand, was also once a successful family-owned firm acquired by RJR Nabisco, then taken over by Kraft when RJR Nabisco broke up (in the wake of the disastrous KKR LBO). Stella was run into the ground by its corporate overseers, then dumped to private equity earlier this decade when Kraft began to dispose of “non-core” assets under pressure from Wall Street. Workers there have been represented by the Bakers’ union since 1964.

Apparently the PE guys see the modest union contract of the older, experienced work force as a good target for their next round of pillaging. In the first round, the company disposed of its unionized route sales drivers by outsourcing distribution to a non-union company.

This time, Stella’s new owners have gone directly at the workforce, ignoring the National Labor Relations Act and demanding steep wage and benefit cuts with no opportunity for the workers and their union to bargain. The National Labor Relations Board, after the usual delay and indecision issued a “refusal to bargain” complaint charging the company with violating the law. The case only went before a federal judge last week; American labor law is so broken that it may take years for justice to prevail.

What’s happening at Stella D’oro is a microcosm of the pressures that have hit working people in the U.S. and around the world in recent decades. When you wonder why median income fell by $2,000 from 2000 to 2007, for instance, think about things like this: the multiple sales of a company from family ownership to one corporate giant after another, with ownership becoming less and less connected to the business of making biscuits; the attack on the gains that union membership had provided workers despite the company long having been profitable with unionized workers; the “delay and indecision” of a National Labor Relations Board gutted during the Bush years and the overall weakness of American labor law. It’s not accidental that wages stay stagnant or get driven down. America’s workers aren’t losing ground because of some mysterious abstract thing called “the economy,” they’re losing ground because of corporate campaigns against them exactly like the one Acuff describes here.
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Viva Las Vegas

One of the constant frustrations of a recession is looking around you, and everything is cheaper than it was not too long ago…but you can’t afford it – because of the recession. Even if you don’t really think your job’s in danger, you’re just a little more worried about the future when you look around at rising unemployment rates.

Las Vegas is one of the places we’re seeing that most glaringly. Calculated Risk lays it out:

According to the Las Vegas Convention and Visitors Authority, visitor volume is off 6.5% from last year, room rates are off 31.6%, and convention attendance is off 30%.

Visitors are back to 1998 levels, however the number of rooms has increased 28.5% since then – from 109,365 rooms in 1998 to 140,529 in 2008. Ouch.

[Housing] Prices almost doubled from January 2003 to the peak in early 2006 – and now are off almost 50% from the peak!

If you can afford it, that Vegas vacation could come cheap…but meanwhile, the tourism industry that’s suffering there is one of the most unionized sectors in the country. The story of Las Vegas’ workers is worth knowing, when you’re thinking about where to vacation and when you’re wondering how American businesses could do better by their workers. Read More

Health Care Round-Up

  • Jason Rosenbaum at Health Care for America Now! (HCAN) alerts us to a new anti-Obama health care front group called Patients United Now. So if you start hearing horror stories coming from that group, remember that it’s not just a group of concerned patients—it’s organized opposition to President Obama’s plans to reform the health care system.
  • The Nation lays out some “Health care bottom lines”:

    1. The public plan must rein in costs.
    2. The public plan must fix uncompetitive markets.
    3. The public plan must change the way medicine is practiced.

  • Also at The Nation, news of more attempts to kill health care reform.
  • From Reuters, “U.S. health system discourages innovation”:

    Countless workers in the United States are trapped in jobs they would like to leave because they cannot get health insurance elsewhere, calcifying innovation and mobility in the world’s largest economy.

    Daunted by health-care costs, a would-be technology entrepreneur in Texas decides not to start her own business. A communications expert in Washington decides not to strike out on his own. And a freelance magazine editor in Brooklyn decides to take a less satisfying corporate job.

  • From the Wall Street Journal, “More small firms drop health care”:

    Accelerating health-care premiums and sharp revenue shortfalls due to the recession are forcing some small companies to choose between dropping health insurance or laying off workers — or staying in business at all.

And that’s one of the reasons business owners should be supporting serious health care reform—because it will help them, too.


Interesting Things Around the Internet

  • In The costs of poverty I cited the higher cost of basic food items at urban corner stores vs. larger supermarkets. Over at GastroNomalies, Ali S. looks at FRESH, Food Retail Expansion to Support Health, an attempt by NYC to encourage better grocery options.
  • At The American Prospect, former Sec. of Labor Robert Reich asks some questions about what American industrial policy should look like.
  • From CNN:

    In two indications of continuing job market weakness, a drop in the government’s weekly reading of initial unemployment claim filings failed to match the surge of the prior week, and the number of people filing on an ongoing basis rose to a record high for the 16th straight week.
    A total of 631,000 people filed new claims for jobless benefits in the week ended May 16, the Labor Department said. That’s a decrease of 12,000 from an upwardly revised 643,000 in the previous week.