In order to build wealth and create opportunities in and across America’s underserved communities, and reverse the troubling trends we’re seeing in our economy, we no longer find it defensible to focus on job creation alone. It’s clear that job creation does not itself equate to lasting economic change. And so, we must shift our focus to the creation of higher quality jobs — jobs that are good for workers and their families, good for businesses, and good for communities — enabling us to build an economy that works for everyone.
Each month, we bring you the latest roundup of news from the fight for quality jobs for working people.
Updates On Raising The Wage
There was a study this month on the effects of Seattle’s newly implemented $15 minimum wage, and it kicked off a wide-ranging discussion and a lot of criticism. The study said that raising the wage caused companies across the city to cut back on workers hours – causing workers to actually lose income over the course of a month, according to The Washington Post.
While more conservative “pro business” groups and media sites seized on the results as “proof” that living wages don’t work, there were actually serious issues with the study, as highlighted in Fortune Magazine. For one, the study included no large corporate or chain store or restaurant employers – only small businesses – and excludes about 40% of Seattle’s actual workers. That means places like McDonald’s, Best Buy, and other stores that rely heavily on the low-wage workers who got the actual boost weren’t counted — and that’s a highly significant oversight.
This one study might be an outlier, and it isn’t stopping proponents of living wages from fighting on. Congressional Democrats introduced a bill this month to raise the federal minimum wage to $15 an hour by 2024. While most coverage of this bill was on whether $15 by 2024 is too ambitious a target, there’s a less-discussed aspect of the bill that deserves considerable attention as well: its elimination of “sub-minimum” wages for various groups of workers. Establishing one minimum wage for everyone would help those workers whom past minimum wage increases have left behind. It would also break with the pattern of reinforcing anti-worker myths about the economy. Read more in American Prospect >
Speaking of studies, there’s another one out this month that isn’t being disputed: one that reveals just how untenable conditions have become for the working poor. The report reveals there’s not a single county or metropolitan area in which a minimum-wage worker can afford a modest two-bedroom home, which the federal government defines as paying less than 30% of a household’s income for rent and utilities. And in only 12 counties in the country is a modest one-bedroom home affordable, according to the report, published Thursday by the National Low Income Housing Coalition. Read more on Alternet >
Good Jobs Beyond Fair Wages
While a living wage one aspect of what makes a quality job, it isn’t the only part. A new report this month from the AEI-Brookings Working Group on Paid Family Leave highlights the benefits and costs of providing paid leave from the perspective of workers, businesses, and society. Paid family leave affects children and families, it affects women’s ability to participate in the labor market, and it affects economic growth. Recent research suggests that when compared to other developed countries, women’s labor force participation in the US has stalled, and nearly a third of the gap can be explained by the lack of family-friendly policies such as paid leave.
Looking At The Racial Wealth Divide
More than half a century after the passage of the Civil Rights Act, economic differences between whites and blacks continue to be a source of social and political tension in the United States. One out of four black families lives in poverty, and the median household income for black families is $37,000. Meanwhile, roughly one out of 10 white families live in poverty, and white families have a median income of $63,000. According to Stanford and Kauffman Foundation, this enduring gap extends to entrepreneurship as well. Black-owned businesses start with less money when they begin, get fewer and smaller bank loans, and invest money at a slower rate over the years when compared with white-owned business. This means that differences between funding for black- and white-owned businesses when a firm begins persist and even worsen over time.
So what’s to be done? Our friends at the Aspen Institute have ideas. They have a new paper with short- and long-term recommendations to address the racial wealth gap through business ownership strategies. In the short-term, continuing and expanding efforts to increase access to capital, skills, networks, and markets will be needed to realize the promise that business ownership holds for addressing the racial wealth gap. In the long-term, universal policies to narrow the racial wealth gap — such as those aimed at raising the quality of education, building savings, and increasing financial inclusion — will be critical.
While empowering businesses owned by people of color will help build wealth from the top down, there’s also another movement afoot to help from the bottom up. There are between 14 million and 15.8 million Americans of working age with felony convictions, and 6.1 million to 6.9 million of them are also former prisoners. A large majority of those with felony records are people of color, and employers often rule them out as hires, putting them in a state of semi-permanent exile from all but the most poorly paid and exploitative fringes of the economy. The Week has a great article on the ongoing “ban the box” movement to prevent employers from asking about criminal records on initial hiring forms.
There’s no shortage of forces and factors bearing down on the American worker at any given time: Skilled manual labor jobs replaced by robots, towns built around fossil fuel jobs declining as we need to move to a clean-energy economy, and outsourcing and factory closures sending middle-class jobs to low-wage countries.
So what do we do about it? This month there are a lot of great lessons to be learned from communities and thought leaders who are working for working people. The World Economic Forum looks at several policy solutions, some new and some controversial, such as a universal basic income, a “robot tax”, government job guarantees, and a broader social safety net. Yes! Magazine looks at a coal town in Kentucky where a complex network of local organizations helps neighbors support one another as they rebound from a dying industry. The Hill looks into a bipartisan focus on protecting America’s call-center jobs and clawing back the hundreds of thousands that have been sent overseas. Lastly, The Mastercard Center for Inclusive Growth has an in-depth report on things we need to do as a country for America’s workers: Bring grassroots innovations to scale; Prepare workers for tomorrow’s jobs in fast and affordable ways; Tie urban wealth expansion to workers’ wealth expansion; and stabilize benefits for gig workers and contractors.