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Death of an Adjunct

6:57 am in Uncategorized by ThirdandState

By Stephen Herzenberg, Third and State

Duquesne Campus

After 25 years of service to Duquesne Universty, an adjunct died in poverty.

Appearing earlier this month on a radio program in Pittsburgh with labor historian Charles McCollester, I heard for the first time the story of Margaret Mary Vojtko, a 25-year adjunct faculty member at Duquesne University who died recently in poverty at the age of 83.

Two and a half years ago, the Keystone Research Center released the most comprehensive state report in the United States on the rising use of adjunct faculty at colleges and universities. The numbers were sobering. Even if they cobbled together a full-time (10 courses per year) load at multiple institutions, adjunct community college faculty in Pennsylvania earned only about $25,000 annually. Contingent faculty members and instructors taught 42% of the courses at all public colleges and universities in Pennsylvania (versus 49% nationally). Most part-time/adjunct faculty members in Pennsylvania public higher education received no health or pension benefits.

Given cuts in state funding for higher education since we wrote our report, the situation is surely worse today in Pennsylvania.

How do we avoid a future in which a majority of higher education faculty earn less than a “quality” wage — a wage sufficient to give teachers time to prepare lessons, establish office hours, and provide feedback that increases student learning?

It would help if we honored the rights of part-time/contingent faculty to join a union — starting, for example, at Margaret Mary’s Duquesne. One game-changing option would give all part-time and contingent faculty at publicly funded Pennsylvania higher education institutions the freedom to form a single statewide local union. This would enable part-time and contingent faculty to negotiate statewide wage and benefit standards and working conditions consistent with teaching excellence. (This type of geographically based union that lifts up low wages and benefits in service industries that can’t relocate — because they have to be near their “customers” — is exactly what is needed to rebuild the middle class generally in Pennsylvania and the United States. See my earlier posts on fast food workers and on the 50th Anniversary of Martin Luther King’s “I Have a Dream Speech.”)

State lawmakers also need to develop — and fund — a long-term plan for paying all higher education teachers a “quality wage.” In a world both moral and rational, this could be part of a broader plan that also makes post-secondary education affordable again for students, and marries online and in-person education to lower costs while maintaining quality.

This approach starts with values — the outcomes we want for students, faculty, and taxpayers — and then uses technology, collective problem-solving, and social negotiation to create a world that honors those values. Imagine the possibilities.

The story of Margaret Mary is a sad reminder that all public policy discussion should start from values — the world we want to create and, unfortunately, the world we want to avoid.

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‘This Is What the Middle Class Looks Like’

9:09 am in Uncategorized by ThirdandState

By Stephen Herzenberg, Third and State

"This Is What Democracy Looks Like"

But what does a real middle class look like?

“This is what democracy looks like.” Even though this chant originated with the Seattle protests against the World Trade Organization (WTO), which haven’t yet led to major reforms, the phrase nonetheless captures the idea of a social movement that has crystallized its demands and has a better chance to succeed because of it. Other examples include the right to vote in the civil rights movement, or the fight to legalize gay marriage, a simple modern demand that culminates a fight for equality in all its dimensions.

One challenge in the U.S. fight for economic justice since inequality began to yawn wider in the 1970s has been the lack of a simple demand that either working people or elites thought could bring back the middle class. Having such a demand fuels social movements because it gives members of the movement confidence — conviction — that there is a way for the world to give them what they want. It also fuels social movements because it gives the broader society a way to let the protesters get a win.

The fast food workers engaging in one-day strikes across the country may be on the verge of crystallizing a simple demand to which their low-wage employers could accede — and, in the process, cracking the code to the next U.S. middle class.

Today’s story on these strikes in The New York Times says that the organizers aren’t actually clear yet on the path to victory. The demand is a $15-per-hour wage — a ticket to the middle class. But will progress result from a higher minimum wage, local living wage requirements for big chains, or companies themselves raising wages to get off the front page? (This is where you say in your best pompous pundit voice, “Well, ah, um, cough, good question.”)

Because these protesters have a practical, confident vision of the end point they want — an economy that pays lower-wage workers a middle-class wage (so what if Big Macs cost 50 cents more) — they have a good chance of finding the mechanism that can get them there and keep them there (or forcing the rest of us to figure out the mechanism).

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Toshi Seeger and Respect for the Working Man and Woman

7:42 am in Uncategorized by ThirdandState

By Stephen Herzenberg, Third and State

Pete & Toshi Seeger

Toshi Seeger’s hard work helped Pete’s music shine.

Toshi Seeger’s obituary last week in The New York Times brought a smile to my face.

Toshi provided her husband, the folk singer Pete Seeger, with the organizational skills without which he would have not been so influential or commercially successful.

Toshi also kept him grounded. “I hate it when people romanticize him,” she said. “He’s like anybody good at his craft, like a good bulldozer operator.”

That simple sentiment works in both directions. It helped make sure Pete Seeger would not become too big for his britches. It also communicates deep respect for the bulldozer operator — and for hardworking people more generally.

One of many problems with the obscene income inequality that has emerged in the United States since the 1970s is that too many people in the “1%” (and the smaller groups at the very, very top) seem to have convinced themselves that they are not only deserving but also somehow different than — better than — other people.

Economic elites and the broader culture have also come to respect much less the hard work of regular folks — the nurse’s aide and the sanitation worker, the back hoe operator and the warehouse worker, the truck driver and the child-care teacher. Legislators and advocates for local government communicate this, for example, every single time they seek to cut the state’s prevailing wage for construction workers.

Along with their serial refusal to look at the ample evidence that paying construction workers decently does not increase construction costs, these proponents of weakening prevailing wage laws imply, again and again, “anyone off the street can do construction work just as well as experienced crafts workers.” It’s not true. It’s deeply offensive. And it’s sad that the people being so dismissive of other people’s skills don’t even realize how insulting they are being.

Maybe a few folks reading Toshi Seeger’s obituary will pause briefly to reflect on the moral compass that led her to equate her phenomenally successful folk singer husband and a good bulldozer operator. That would be a good thing.

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Imagine … A Minimum Wage Your Daughter Could Live On

11:57 am in Uncategorized by ThirdandState

By Stephen Herzenberg, Third and State

The Australian minimum wage this year is $15.96 per hour. I know this mostly because my daughter lives in Melbourne these days (not forever, I hope). When she arrived there 18 months ago, she got a job at a minimum-wage restaurant. She earned enough to cover her rent and other expenses.

What brought the idea of a much higher minimum wage to mind is a blog post from Dean Baker of the Center for Economic Policy Research. Dean estimates that the U.S. minimum wage today would be $16.54 per hour if it had kept pace with U.S. productivity growth since 1947.

For those with knowledge of economic history (both of us), a minimum wage that increases its buying power every year does not seem far fetched, even in the good old United States. The U.S. minimum wage DID increase with productivity growth from 1948 to 1968. This linkage (see Dean’s chart below) resulted from the combined impact of two mechanisms: manufacturing wages kept pace with productivity growth thanks to collective bargaining in mass manufacturing (starting with the famous auto industry “Treaty of Detroit” in 1948); and Congress periodically increased the minimum wage to bring it back up to 50% of the average manufacturing wage.


Click on the chart above for a larger view
In recent decades, the most ambitious aspiration in U.S. political debate has been that the minimum wage keep pace with inflation (even Mitt Romney was for this briefly — after he was against it and before he wasn’t sure any more).

If you think about it for a second, a minimum wage that keeps pace with inflation is a fairly pathetic aspiration. It means that our lowest-wage workers get to have their living standards stay the same forever, even as the economic pie keeps growing with increases in productivity.

Wages — and minimum wages — that keep pace with productivity growth express a different and completely practical aspiration: the idea that workers at all levels should share in the expanding economic pie. Fair reward for hard work. Even sounds like a fundamental American value. Let’s get back to it. If we did, Charlotte might even come home.

March Job Numbers For Pennsylvania and CEO Pay

1:37 pm in Uncategorized by ThirdandState

By Mark Price, Third and State

The Pennsylvania Department of Labor and Industry released new data for March on Pennsylvania’s employment situation. According to the household survey, the unemployment rate edged down slightly to 7.5%, and the survey of employers showed healthy growth in nonfarm payrolls of 7,800 jobs.

As always, caution should be exercised in interpreting a month change in employment statistics.

In terms of levels, there were big gains in Leisure and Hospitality (7,000), Trade Transportation and Utilities (4,000) and Manufacturing (2,100). We will not have full information until the fall whether the job losses in the public sector will put a drag on employment growth in 2012, but the March data shows we are off to an uncomfortable start, with 2,500 jobs lost.

Over the last several months, Pennsylvania nonfarm payroll counts have been particularly volatile, showing big one-month gains and losses thanks to a combination of unusually warm weather and some technical issues. On average over the last six months, Pennsylvania has added just under 6,000 jobs a month. We need about 10,000 jobs a month to move back to full employment by March 2015 (three years from now).

While unemployment remains high today and for the foreseeable future, the distance between CEO pay and the pay of the typical worker reached an all time high in 2011.

Corporate CEOs are now making 380 times the salary of the average American worker, a record high and the biggest pay gap in the whole world, according to the 2011 AFL-CIO’s Executive Paywatch.

All Together Now, It’s Time to Raise the Minimum Wage

7:38 am in Uncategorized by ThirdandState

PUT POLITICIANS ON MINIMUM WAGE & WATCH HOW FAST THINGS CHANGE

(photo by spike55151 via flickr)

 

By Mark Price, Third and State

The New York Times reports this morning that a labor organizer and advocate for a higher minimum wage in Bangladesh has been brutally murdered.

The killing of the activist, Aminul Islam, marks a morbid turn in the often tense relations between labor groups, on one side, and Bangladesh’s extensive garment industry, which makes clothes for Western companies like Walmart, Tommy Hilfiger and H&M. In 2010, Mr. Islam, a former textile factory worker, was arrested and, he and other labor activists said, was tortured by the police and intelligence services.

Also in The New York Times this morning, Steven Greenhouse profiles the campaign to raise the minimum wage in the United States.

As the nation’s economy slowly recovers and income inequality emerges as a crucial issue in the presidential campaign, lawmakers are facing growing pressure to raise the minimum wage, which was last increased at the federal level to $7.25 an hour in July 2009.

State legislators in New York, New Jersey, Connecticut, Illinois and elsewhere are pushing to raise the minimum wage above the federal level in their own states, arguing that $7.25 an hour is too meager for anyone to live on.

It’s time to get serious about raising the minimum wage here in Pennsylvania.

Dumb and Dumber PA State Construction Policies

11:25 am in Uncategorized by ThirdandState

By Stephen Herzenberg, Third and State

I’ve got an idea: let’s employ low-wage, low-skill, and sometime out-of-state workers on small and medium-sized state-funded construction projects, with no benefit to taxpayers and negative impacts on local economies.

Sound like a stupid idea? That’s because it is.

Here’s the backdrop: Pennsylvania’s prevailing wage law requires that workers on state-funded construction projects be paid a wage in line with what most other workers in their trade are paid within a certain geographical area.

Research in peer-refereed academic publications shows that the law could be called the quality construction law because it helps ensure the use of skilled workers on state projects. Where prevailing wage laws exist, training investment, worker experience, wages, benefits, and safety levels are all higher than where these laws do not exist.

Overall construction costs are the same with or without prevailing wage laws. The prevailing wage law, however, makes it impossible for contractors that employ low-wage, out-of-state workers to win bids on state projects: it ensures that jobs go to local workers, who spend their money at local businesses.

More middle-class jobs, stronger local economies, higher quality construction, no cost to taxpayers: what’s not to like?

Unfortunately, some members of the Pennsylvania Legislature seem unwilling to leave well enough alone. Through House Bill 1329, these lawmakers want to make the prevailing wage law to apply to less state-funded construction work. How so? By exempting projects of less than $185,000 from prevailing wage standards. Currently, the law applies to all state-funded projects of $25,000 or higher.

Why one wants a threshold at all is not clear; eight states don’t have one. They have, instead, a clear policy of supporting a high-wage, high-skill approach to all state-funded construction.

Of the 32 states that have a prevailing wage law, only three have a threshold as high as that proposed in House Bill 1329.

Raising the threshold may not be as stupid a policy as eliminating the prevailing wage law altogether, or carving big parts of public construction (e.g., school projects) out of the law. But it’s still dumb.

For a complete list of our research and commentary on Prevailing Wage see our Prevailing Wage Issue page.

Prevailing Wage Opponents Fail to Look at the Research

9:16 am in Uncategorized by ThirdandState

The Final Part of a Three-part Series on Prevailing Wage by Mark Price and originally published at Third and State. Read Part 1. Read Part 2.

In the first two posts of this series, I explained why the numbers being tossed around by advocates of repealing prevailing wage don’t add up. I explained that the claims of cost-savings are not based on any actual experience and that they represent the result of laughable hypothetical, or “what if,” calculations. 

This leads to the most important point that the Pennsylvania School Boards Association, the Pennsylvania State Association of Boroughs, the Harrisburg Patriot-News Editorial Board and others keep missing: we can do much better than a hypothetical when assessing the impact of prevailing wage laws.

There is a body of research that examines construction costs (and other construction outcomes, like safety, training investment, wages, benefits, etc.) in states with and without prevailing wage laws as well as in states that eliminated prevailing wage laws. We don’t have to conjecture what “might” happen: we can look at what did happen. The preponderance of the evidence shows that prevailing wage laws do not raise construction costs.

Back in the late 1990s, Pennsylvania actually ran this real-world experiment itself — we lowered our prevailing wage levels, particularly in rural areas. That means we can look at what happened to construction costs. What happened is the same thing that has happened in other places — lower prevailing wages did not translate into lower construction costs. 

Specifically, the Keystone Research Center’s 1999 study of this late 1990s Pennsylvania policy experiment examined changes in public school construction bids when Pennsylvania’s prevailing wages were lowered substantially in rural areas. Keystone found no association between the number of occupations in which the prevailing wage was lowered and the price per square foot of school construction bids. If anything, construction bids appeared to go up more in areas where prevailing wages were lowered more.

Advocates of repeal often point to sympathetic construction managers in the public sector who testify, based on their expertise, that prevailing wage laws raise costs. Not only did the Keystone study find no statistical evidence of a cost difference during the period wages were lowered, but the study highlighted two revealing instances of construction managers making wild predictions that just didn’t come true:

The recent experience of two Pennsylvania school districts show that even increases in legally mandated prevailing wage and benefits rates do not necessarily increase public construction costs. In March 1999, after two months of legal uncertainty about required prevailing wage levels, [the Pennsylvania Department of Labor and Industry] began issuing prevailing wage rates that were higher than the 1999 rates. The Blue Mountain School District, in Schuylkill County, was planning to renovate its high school.  In April 1999, the school district’s construction manager estimated that construction costs would increase by about $670,000 as a result of the higher prevailing wage and benefit rates. But when bids for the project were opened on May 6, the low bids, which were expected to be about $15.1 million, came in at only about $13.8 million, almost 9 percent below the anticipated level. And in April, bids for a middle school construction project in Tamaqua, which used the same prevailing wage and benefit rates as the Blue Mountain bids, also came in under budget estimates.

Read the rest of this entry →

Prevailing Wage Opponents Fail Labor Market Statistics 101

7:47 am in Uncategorized by ThirdandState

Commonly available statistic calculator, alas unused (photo: andresrueda/flickr)

Commonly available statistic calculator, alas unused (photo: andresrueda/flickr)

Part Two of a Three-part Series on Prevailing Wage by Mark Price, originally published at Third and State. Read Part 1.

The overwhelming weight of evidence based on the actual cost of public construction projects shows that prevailing wage laws do not raise costs. Therefore, advocates of repealing the law in Pennsylvania ignore this evidence. Instead of “evidence-based policy,” we have “lack-of-evidence-based policy.” Go figure.

Repeal advocates use a hypothetical calculation that makes assumptions about cost, rather than empirically examining the relationship between higher wages and total construction costs. (As discussed here, even these hypothetical cost estimates don’t make sense once you apply real world data to how much labor costs represent of total construction cost.)

Another key ingredient in the hypothetical calculations used by proponents of repeal is the claim made most recently by the Pennsylvania State Association of Boroughs (PSAB) that “the prevailing wage is 30 percent to 60 percent higher than the average wage for the same occupation.”

This claim is based on an update of a flawed calculation by the Commonwealth Foundation. It compares the prevailing wage levels by trade as set by the Pennsylvania Department of Labor & Industry with the average wages for construction occupations reported in Occupational Employment Statistics (OES). The prevailing wages are 30% to 60% higher than the OES averages.

The problem is, the Commonwealth Foundation/PSAB calculation is the proverbial apples-to-oranges comparison: it measures different portions of the construction industry.

OES data include wages paid to workers employed in the residential construction sector — smaller, less-complex projects than prisons, bridges, schools and other state-financed construction. Residential construction relies on workers less skilled and experienced than those needed for larger state projects.

Indicative of this skill gap in Pennsylvania is the fact that construction workers employed in nonresidential construction — most of which is private sector, not public — earn 52% more than construction workers in the residential construction sector. In other words, the gap between the occupational prevailing wages set by the Pennsylvania Department of Labor & Industry and average construction wages reported by OES reflects the wage gap between residential and nonresidential construction.[1] (See Table 1 below.) Read the rest of this entry →

Prevailing Wage Opponents Fail the Laugh Test

7:19 am in Uncategorized by ThirdandState

(photo: martinsphotoart, flickr)

(photo: martinsphotoart, flickr)

Part One of a Three-part Series on Prevailing Wage by Mark Price and originally published at Third and State.

Prevailing wage laws have long operated nationally and in states as a check against the tendency of the construction industry to degenerate into destructive wage and price competition. Such competition can drive skilled and experienced workers from the industry, reduce productivity and quality, and lead to poverty-level jobs, all without saving construction customers any money.

In an exhaustive review of the research on the impact of prevailing wages on contracting costs, Nooshin Mahalia concluded:

At this point in the evolution of the literature on the effect of prevailing wage regulations on government contract costs, the weight of the evidence is strongly on the side that there is no adverse impact. Almost all of the studies that have found otherwise use hypothetical models that fail to empirically address the question at hand. Moreover, the studies that have incorporated the full benefits of higher wages in public construction suggest that there are, in fact, substantial, calculable, positive benefits of prevailing wage laws.

Although the weight of evidence suggests prevailing wage laws do not raise costs, advocates for repealing the law in Pennsylvania continue to repeat some version of the following:

Prevailing Wage law also harms taxpayers, as it forces them to pay higher labor costs on public construction projects. Construction companies forced to pay union-inflated wages and benefits will pay upward of 30 percent more in labor costs for identical work on private sector projects. This adds a little more than 20 percent to the cost of every taxpayer-funded construction project — resulting in an estimated $1 billion cost for state and local taxpayers each year.

- Matthew J. Brouillette
President & CEO of the Commonwealth Foundation
March 22, 2011

What is the source of this 20% saving claim? One source is Nathan Benefield, the research director of the Commonwealth Foundation, in this 2009 blog post. Read the rest of this entry →