The future of work depends on stopping Amazon’s union busting: Shareholders and policymakers must all play a role in protecting Amazon workers’ rights

This week’s Amazon shareholder meeting provides an important opportunity to consider urgent steps shareholders and policymakers can take to protect the threatened rights of unionizing Amazon workers and counter the company’s growing impact on income inequality, racial and gender disparities, and the degradation of work across the labor market.

The agenda for the May 25th annual meeting includes the election of company directors, approval of executive compensation, and several shareholder resolutions concerning Amazon’s employment practices and labor law violations. While Amazon opposes all these resolutions, shareholders should take the opportunity to reject excessive pay for Amazon’s CEO and support resolutions calling for audits of worker health and safety, racial equity and racial and gender pay gaps, employee turnover, and Amazon policies and practices affecting workers’ rights to freedom of association and collective bargaining. Meanwhile, state and federal policymakers should take note of the policy priorities the resolutions suggest for ensuring that Amazon’s anti-union, high-risk, high-turnover business model isn’t allowed to dictate the future of work in the United States and across the globe.

Amazon’s use of a wide range of legal and illegal tactics to prevent workers from unionizing has been well documented. Amazon engaged in months of coercion, intimidation, vote gerrymandering, and retaliation against Bessemer, Alabama warehouse workers in the lead-up to their 2021 union election. Aggressive company surveillance led many workers to believe the company was monitoring their secret ballot votes—an offense so egregious it led the National Labor Relations Board (NLRB) to order a brand new election (the 2022 outcome of which remains too close to call).

In April, Amazon workers at the JFK8 warehouse in Staten Island overcame similar obstacles, including numerous Amazon labor law violations, to win a decisive union election victory. In response, Amazon has refused to recognize the new Amazon Labor Union, instead dragging out legal challenges and refusing to meet with workers to start bargaining a contract. A new report published last week further documents the failure of Amazon’s corporate policies and practices to meet international human rights standards for respecting workers’ rights to freedom of association and collective bargaining.

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Guest post: Food insufficiency in families with children increased after expiration of Child Tax Credit monthly payments

Amidst the continuing COVID-19 pandemic and increased inflation, 15% of households with children reported food insufficiency in March–April 2022. The reports of food insufficiency—sometimes or often not having enough food to eat in the past week—are from the nationally representative Household Pulse Survey (HPS), an internet survey conducted by the U.S. Census Bureau.

Food insufficiency among families with children poses a short- and long-term moral and economic threat to the United States. Even brief disruptions in access to food can have lasting consequences. Not having enough to eat often disrupts children’s cognitive and emotional development and education. This was the case for a child who disclosed that the reason she was fidgeting and not paying attention in class was that she did not have enough food to eat. There may be lifelong ramifications of not having enough to eat in childhood, including increased likelihood of poor health outcomes and avoidable medical expenditures across the lifespan.

Fortunately, Congress can help. Several studies indicate that advance Child Tax Credit (CTC) payments, expanded under the American Rescue Plan Act, were associated with reduced poverty and food insufficiency in households with children.

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Following Dr. Lisa Cook’s historic confirmation to the Federal Reserve Board, we must acknowledge the importance of Black economists for public policy and the economy

Earlier this year, President Biden nominated two Black economists, Dr. Lisa Cook and Dr. Philip Jefferson, to serve as members of the Federal Reserve Board of Governors. On May 10, 2022, Dr. Cook was confirmed in a 51–50 party-line vote, which made her the first Black woman to sit on the Board in its 108-year history. The following day, Dr. Jefferson was confirmed on a 91–7 bipartisan vote, making him the fourth Black man to sit on the Board, but marking the first time two Black governors will serve simultaneously.

Despite this tremendous accomplishment, the nomination of Dr. Cook faced great scrutiny and criticism, with several Senate members questioning her qualifications and expertise despite her years of professional and academic experience in economic development, financial institutions and markets, economic history, and international relations. Sadly, this isn’t new for Black professionals, and specifically not for Black women.

Within the workplace and historically, Black women’s skills and contributions are often undermined, underappreciated, and devalued. These discriminatory roots have led to intersectional gender and racial inequities in the kinds of jobs Black women are hired for as well as the wages and benefits they receive. However, another glaring detail we can glean from the captious confirmation process of Dr. Cook—and the exclusion of Black women from the Federal Reserve Board’s panel for over a century—is how Black economists are broadly underrepresented and their essential view on racial economic inequality is often discounted.

The underrepresentation of Black scholars in the field of economics can be traced to the low numbers of Black students pursuing degrees in economics. In the academic year 2019–2020, there were more than 1,200 doctoral degrees awarded to students in economics. However, less than 2% of doctoral degrees were awarded to Black economics students overall and less than 1% were awarded to Black women. For undergraduate students, Black students overall accounted for 4.1% of bachelor’s degrees awarded in economics and Black women accounted for only 1.5%.

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Abortion rights are economic rights: Overturning Roe v. Wade would be an economic catastrophe for millions of women

A leaked draft of a majority opinion authored by Supreme Court justice Samuel Alito strongly suggests that the court will rule to overturn Roe v. Wade and Planned Parenthood v. Casey, the two landmark cases that have upheld the right to an abortion nationwide for the last half century. If the final ruling largely follows what is sketched out in the leaked draft, abortion services will be drastically curtailed, if not outright banned, in over half the country.

Abortion is often framed as a “culture-war” issue, distinct from material “bread and butter” economic issues. In reality, abortion rights and economic progress are deeply interconnected, and the imminent loss of abortion rights means the loss of economic security, independence, and mobility for millions of women. The fall of Roe will be an additional economic blow, as women in the 26 states likely to ban abortion already face an economic landscape of lower wages, worker power, and access to health care.

Women’s economic lives, livelihoods, and mobility are at the heart of the reasoning to overrule Roe.

In the draft majority opinion, Justice Alito dismissed the argument in Casey that women had organized their lives, relationships, and careers with the availability of abortions services, writing “that form of reliance depends on an empirical question that is hard for anyone—and in particular, for a court—to assess, namely the effect of the abortion right on society and in particular on the lives of women.” In fact, this empirical question has been definitively assessed and answered. A rich and rigorous social science literature has examined both the detrimental effect of a denied abortion on women’s lives, as well as the individual and societal economic benefits of abortion legalization, as detailed in the thorough amicus brief filed in Dobbs on behalf of over 100 economists.

Some of the economic consequences of being denied an abortion include a higher chance of being in poverty even four years after; a lower likelihood of being employed full time; and an increase in unpaid debts and financial distress lasting years. Laws that restrict abortion providers, so-called “TRAP” laws (targeted regulation of abortion providers), have led to women in those states being less likely to move into higher-paying occupations.

On the flip side, environments in which abortion is legal and accessible have lower rates of teen first births and marriages. Abortion legalization has also been associated with reduced maternal mortality for Black women. The ability to delay having a child has been found to translate to significantly increased wages and labor earnings, especially among Black women, as well as increased likelihood of educational attainment. Treasury Secretary Janet Yellen concluded that “eliminating the rights of women to make decisions about when and whether to have children would have very damaging effects on the economy and would set women back decades.”

The draft opinion of this overtly partisan Supreme Court ignores the rigorous data and empirical studies demonstrating the significant economic consequences of this decision. In doing so, it lays bare the cruel and misogynistic politics that motivate it. Justice Alito’s dismissal of claims that forcing women to bear an unwanted pregnancy imposes a heavy burden is shockingly glib, as he simply asserts “that federal and state laws ban discrimination on the basis of pregnancy, that leave for pregnancy and childbirth are now guaranteed by law in many cases, that the costs of medical care associated with pregnancy are covered by insurance or government assistance….”

Every statement in this casual litany is wildly misleading. Women are still routinely fired for being pregnant, close to 9 in 10 workers lacked paid leave in 2020, the costs of maternity care with insurance have risen sharply and constitute a serious economic burden for even middle-income families. And many of the states certain or likely to ban abortion after the fall of Roe have not expanded Medicaid, leaving women without insurance facing much steeper costs—particularly in the immediate post-partum period. And, of course, our failed health care system often imposes the ultimate cost of all on pregnant women: The U.S. rate of maternal mortality, especially for Black women, ranks last among similarly wealthy countries. In short, the potential costs of bearing a child are high indeed, and it is women who should decide if and when they wish to shoulder them.

Figure A

States likely to ban abortion are more likely to have higher incarceration rates and lag in wages, worker rights, and access to health care

State Minimum wage Incarceration rate (per 100k) Abortion status Right to Work key Medicaid Expansion Right to Work Medicaid Expansion key  Abortion status key
Alabama $7.25 419 Pre-Roe ban or bans/extreme limits RTW No Expansion 1 1 2
Alaska $10.34 243 No change Not RTW Adopted Expansion 0 0 0
Arizona $12.80 556 Pre-Roe ban or bans/extreme limits RTW Adopted Expansion 1 0 2
Arkansas $11.00 585 Trigger ban RTW Adopted Expansion 1 0 1
California $14.00 310 No change Not RTW Adopted Expansion 0 0 0
Colorado $12.56 342 No change Not RTW Adopted Expansion 0 0 0
Connecticut $13.00 246 No change Not RTW Adopted Expansion 0 0 0
Delaware $10.50 380 No change Not RTW Adopted Expansion 0 0 0
Washington D.C. $15.20 N/A No change Not RTW Adopted Expansion 0 0 0
Florida $10.00 444 Likely to ban RTW No Expansion 1 1 3
Georgia $7.25 507 Pre-Roe ban or bans/extreme limits RTW No Expansion 1 1 2
Hawaii $10.10 215 No change Not RTW Adopted Expansion 0 0 0
Idaho $7.25 474 Trigger ban RTW Adopted Expansion 1 0 1
Illinois $12.00 303 No change Not RTW Adopted Expansion 0 0 0
Indiana $7.25 400 Likely to ban RTW Adopted Expansion 1 0 3
Iowa $7.25 293 Pre-Roe ban or bans/extreme limits RTW Adopted Expansion 1 0 2
Kansas $7.25 342 No change RTW No Expansion 1 1 0
Kentucky $7.25 515 Trigger ban RTW Adopted Expansion 1 0 1
Louisiana $7.25 678 Trigger ban RTW Adopted Expansion 1 0 1
Maine $12.75 146 No change Not RTW Adopted Expansion 0 0 0
Maryland $12.50 305 No change Not RTW Adopted Expansion 0 0 0
Massachusetts $14.25 133 No change Not RTW Adopted Expansion 0 0 0
Michigan $9.87 381 Pre-Roe ban or bans/extreme limits RTW Adopted Expansion 1 0 2
Minnesota $10.33 177 No change Not RTW Adopted Expansion 0 0 0
Mississippi $7.25 636 Trigger ban RTW No Expansion 1 1 1
Missouri $11.15 423 Trigger ban Not RTW Adopted Expansion 0 0 1
Montana $9.20 439 Likely to ban Not RTW Adopted Expansion 0 0 3
Nebraska $9.00 289 Likely to ban RTW Adopted Expansion 1 0 3
Nevada $9.75 412 No change RTW Adopted Expansion 1 0 0
New Hampshire $7.25 197 No change Not RTW Adopted Expansion 0 0 0
New Jersey $13.00 209 No change Not RTW Adopted Expansion 0 0 0
New Mexico $11.50 315 No change Not RTW Adopted Expansion 0 0 0
New York $13.20 224 No change Not RTW Adopted Expansion 0 0 0
North Carolina $7.25 313 No change RTW No Expansion 1 1 0
North Dakota $7.25 231 Trigger ban RTW Adopted Expansion 1 0 1
Ohio $9.30 430 Pre-Roe ban or bans/extreme limits Not RTW Adopted Expansion 0 0 2
Oklahoma $7.25 621 Trigger ban RTW Adopted Expansion 1 0 1
Oregon $12.75 353 No change Not RTW Adopted Expansion 0 0 0
Pennsylvania $7.25 355 No change Not RTW Adopted Expansion 0 0 0
Rhode Island $12.25 156 No change Not RTW Adopted Expansion 0 0 0
South Carolina $7.25 352 Pre-Roe ban or bans/extreme limits RTW No Expansion 1 1 2
South Dakota $9.95 426 Trigger ban RTW No Expansion 1 1 1
Tennessee $7.25 384 Trigger ban RTW No Expansion 1 1 1
Texas $7.25 529 Trigger ban RTW No Expansion 1 1 1
Utah $7.25 207 Trigger ban RTW Adopted Expansion 1 0 1
Vermont $12.55 182 No change Not RTW Adopted Expansion 0 0 0
Virginia $11.00 421 No change RTW Adopted Expansion 1 0 0
Washington $14.49 250 No change Not RTW Adopted Expansion 0 0 0
West Virginia $8.75 380 Pre-Roe ban or bans/extreme limits RTW Adopted Expansion 1 0 2
Wisconsin $7.25 378 Pre-Roe ban or bans/extreme limits RTW No Expansion 1 1 2
Wyoming $7.25 426 Trigger ban RTW No Expansion 1 1 1

Source: Elizabeth Nash and Lauren Cross, “26 States Are Certain or Likely to Ban Abortion without Roe: Here’s Which Ones and Why,” The Guttmacher Institute, October 2021; “State Minimum Wage Laws, Department of Labor, Updated January 2022; Kaiser Family Fund, “Status of State Medicaid Expansion Decisions,” April 26, 2022; E. Ann Carson, "Prisoners in 2020 -- Statistical Tables," U.S. Department of Justice Bureau of Justice Statistics, December 2020; "Right-to-Work States," National Conference of State Legislatures, Updated 2017.

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Recognizing that abortion is an economic issue is an important step in building support for protecting women’s right of access. But this recognition also allows us to see the potential fall of Roe v. Wade as a key piece in a broader politics and economics of control. Twenty-six states currently have laws or constitutional amendments on their books that ban abortion. If Roe is declared overruled, these bans will go into effect. Low- and middle-income women, especially Black and Brown women, will bear the brunt of the impact. Many of the states with preexisting abortion bans held at bay by Roe are also states that have created an economic policy architecture of low wages, barely functional or funded public services, at-will employment, and no paid leave or parental support. In these states, the denial of abortion services is one more piece in a sustained project of economic subjugation and disempowerment.

Figure A shows the 26 states that have “trigger bans” that will set in immediately after the SCOTUS decision, pre-Roe bans or extreme limits, and likely bans. Figure A also shows the minimum wage in that state, whether that state is a so-called “right-to-work” state that makes it harder for workers to collectively bargain and unionize, whether the state has expanded Medicaid, and the rate of incarceration per 100,000 people in that state. While wages and access to health care (through Medicaid) are relatively obvious measures of well-being, so-called “right-to-work” laws are also useful to look at as worker power and unionization also have strong connections to economic, social, and physical health. Mass incarceration and the criminal justice system are also deeply intertwined with racial and economic inequality, from the impact of a criminal record on employment and earnings, to the intergenerational effects on families and communities.

It is no coincidence that the states that will ban abortion first are also largely the states with the lowest minimum wages, states less likely to have expanded Medicaid, states more likely to be anti-union “Right-to-Work” states, and states with higher-than-average incarceration rates. For example, among the states which will ban abortion, the average minimum wage is $8.39, compared with $11.48 in the states that have abortion access. Similarly, 10 of the 26 anti-abortion states have not expanded Medicaid, and all but two of the states are anti-union “right-to-work” states. While the nationwide rate of incarceration is 419 per 100,000 people, in the 26 anti-abortion states the average incarceration rate is 439 per 100,000 people, compared with 272 for the states without abortion restrictions. The consequences of low wages and lack of access to health care, including abortion services, falls especially hard on Black women in many of these states. There is a long history of racism motivating political organization, like the rise of “right-to-work” legislation in the Jim Crow south, or the complicated combination of anti-abortion politics and backlash against desegregation efforts during the political realignment of the 1970s.

Policymakers and advocates must recognize that the fall of Roe is an economic issue and would be one more victory for the economics of control and disempowerment—low wages, little worker power, and rising disinvestment. Reproductive justice is key to economic justice and protects women’s humanity, dignity, and the right to exert freedom over their own choices in the economy.

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Ignoring the role of profits makes inflation analyses a lot weaker

Washington Post columnist Catherine Rampell wrote last week that those pointing to the role of fatter profit margins in driving price inflation are engaged in “conspiracy theories,” and argued that the conspiracy theorists are distracting attention from things that could really lead to lower inflation: faster immigration and removing import tariffs. It’s a pretty unconvincing column all around.

First, the alleged inflation cures that attention is being pulled away from are really weak tea. The case for faster immigration helping to quell inflation runs through its effect on labor markets. If faster immigration increases labor supply this could in theory dampen wage growth. But wage growth has not been the source of the current inflation. And recent readings on wage growth have it roughly consistent with relatively normal rates of inflation. Putting further downward pressure on wage growth that is already lagging far behind inflation would just increase the burden of adjustment to more normal inflation that will be borne by workers.

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No more union-busting. It’s time for companies to give their workers what they deserve

This is an excerpt from an op-ed in CNN Business. Read the full op-ed here.

This year, workers at Amazon, Starbucks and other major corporations are winning a wave of union elections, often in the face of long odds and employer resistance. These wins are showing it’s possible for determined groups of workers to break through powerful employers’ use of union-busting tactics, ranging from alleged retaliatory firings to alleged surveillance and forced attendance at anti-union “captive audience meetings.” But workers should not have to confront so many obstacles to exercising a guaranteed legal right to unionize and bargain for improvements in their work lives and livelihoods.

There are good reasons to believe workers’ organizing momentum will continue (union election filings are already up 57% during the first six months of this fiscal year). Frontline workers are asserting their worth after more than two years of risking their health during an ongoing pandemic while watching corporate profits and CEO pay continue to soar.

The U.S. tax code functionally rewards corporations who use anti-union consultants: Congress must take action

The U.S. tax system is deeply flawed. While millions of working-class Americans pay their fair share, corporations are dodging more and more of their tax responsibilities. Despite record profits, corporate taxes are way down, as corporations exploit loopholes that allow for offshore profit-shifting and various tax breaks and deductions. Specifically, the 2017 Tax Cuts and Jobs Act (TCJA) decreased the statutory corporate income tax rate from 35% to 21% and simultaneously introduced new tax loopholes. Consequently, the TCJA has slashed the effective tax rate for corporations almost in half, further damaging the progressivity of the overall federal tax system. In turn, this erosion of corporate liability and the proliferation of tax avoidance have exacerbated inequality, with the working class facing starved social services, reduced household incomes, and lower standards of living.

One proven tool to combat this rise in inequality is unions. By bringing workers’ collective power to the bargaining table, unions are able to win better wages and benefits for working people—reducing income inequality as a result. Yet data show that U.S. employers are willing to use a wide range of legal and illegal tactics to frustrate the rights of workers to form unions and collectively bargain. And much like our overall tax system favors corporations over working people, the tax code functionally rewards corporations for anti-union activities that suppress worker power.

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Wage growth has been dampening inflation all along—and has slowed even more recently

Yesterday’s inflation data for April 2022 was a mixed bag but had some encouraging seeds in it. Measured year-over-year, overall and core inflation (inflation minus the influence of volatile food and energy prices) both ticked down slightly. Measured just over the past month, the overall index decelerated significantly, but the core index rose back up to the level it had plateaued at in the five months before March. This post is about why wage trends—both throughout the inflationary burst and in very recent months—should make us even a bit more encouraged that inflation can be brought back under control without the Federal Reserve having to move interest rates to a radically more contractionary stance. 

There has been a lot of discussion—and confusion—recently about the role of tight labor markets (“the Great Resignation”) in the rise of inflation we’ve seen since early 2021. In this post, we make the following points about the wage/price relationship:

  • To date, the rise of inflation has unambiguously not been driven by tight labor markets pushing up wages.
  • Nominal wage growth has been fast over the past year relative to the past few decades, but it has lagged far behind inflation, meaning that labor costs are dampening—not amplifying—price pressures. Last week’s jobs report showed that average hourly earnings growth over the last quarter was 4.4% (at an annualized rate), with wage growth actually slowing in the last three months to under 4%.
  • If the only change in the economy over the past year had been the acceleration of nominal wage growth relative to the recent past, then inflation would be roughly 2.5–4.5% today, instead of the 8.6% pace it ran through March. In short, nonwage factors are clearly the main drivers of inflation.
  • Claims that the Federal Reserve needs to shift into a much more hawkish mode to keep wages from amplifying inflation and to bring inflation back down to more normal levels are often greatly overstated and understate how much damage this strategy could cause.
    • As long as wage growth is dampening inflation (and it is), then the question of how hawkish the Fed must be is not a question of whether inflation will return to more normal levels, but just how quickly we want that happen.
    • A much quicker return to more normal inflation would require sacrificing important gains that stem from low unemployment, even though a return to more normal inflation is quite likely to occur on its own. This makes the cost of a more hawkish stance (more joblessness) high and the benefits (a few months of slightly lower inflation as we get back to normal) pretty low.

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Strong and equitable unemployment insurance systems require broadening the UI tax base

The COVID-19 pandemic showed how critical unemployment insurance (UI) is for sustaining workers and the economy during times of crisis, while also revealing deep fissures and inequities in UI systems. Federal programs that expanded UI eligibility, benefit levels, and benefit duration kept local economies afloat and became a lifeline for millions during the early stages of the pandemic, but the crush of UI claims at peak levels of unemployment also exposed the poor condition of state UI systems. From backlogs and delays caused by insufficient administrative capacity and outdated technology to inadequate benefit amounts, many state UI systems operate in a chronic state of underfunding that results in inequity and dysfunction.

One of the root causes of these problems is rarely discussed: Lawmakers have structured state UI financing in a way that permanently starves the UI system. UI is currently funded through a combination of federal and state taxes paid by employers, where state UI taxes pay for benefits during normal economic times. However, in most states, the amount of employee wages on which employers pay state UI taxes, i.e., the taxable wage base (TWB), is extremely low. At present, 14 states and Washington, D.C. have taxable wage bases below $10,000 and a remarkable 36 states have their bases set below $25,000. This means that in 71% of states, employers pay UI taxes at most on the first $25,000 of an employee’s annual earnings.

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Job growth remains strong in April as wage growth cools

Below, EPI economists offer their initial insights on the jobs report released this morning, which showed 428,000 jobs added in April.

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What to watch on jobs day: Wage growth continues to lag inflation

Tomorrow, the Bureau of Labor Statistics (BLS) will release the latest numbers on the state of the labor market. Given fiscal investments at the scale of the problem over the last two years and the resulting trends in payroll employment growth and labor force participation, the labor market is on track for a historically fast and full recovery by the end of 2022.

Even the reported contraction in gross domestic product (GDP) in the first quarter of 2022 won’t push this recovery off track. Most of the slowdown in GDP was due to weak exports (which reflect weakness in trading partner economies, not our own) and to a running down of business inventories, which had been built up at a furious pace in recent quarters. Looking at final sales (so stripping out the inventory effect) to domestic purchasers (so stripping out exports), growth was actually a bit faster in the first quarter of 2022 than it was at the end of 2021.

Moving forward to jobs day, it’s vital to keep tabs on job growth as well as participation to make sure the recovery keeps going strong and reaches all corners of the labor market. It’s also important to track the sectors with particularly large job deficits—like leisure and hospitality—but also state and local jobs, which have had a shallower fall and a slower recovery than the private sector.

Another important metric for a read on the health of the economy and what the Federal Reserve should be doing in the coming year is nominal wage growth. To date, the large increase in inflation since early 2021 has clearly not been driven by labor market trends. In fact, despite being high relative to the recent historical past, nominal wage growth today by every measure is lagging inflation, leading to real wage losses for workers. This is very different than the behavior of wages in previous periods when the unemployment rate was very low and the economy was heating up.

This lagging of nominal wage growth behind price growth has actually dampened inflation so far in this recovery. Tracking this growth going forward is key to deciding whether inflation will stay very high (or even accelerate) or will begin to relent.

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Job Openings and Labor Turnover Survey: Job openings and quits edged up to series highs for March

Below, EPI senior economist Elise Gould offers her initial insights on today’s release of the Job Openings and Labor Turnover Survey (JOLTS) for March. Read the full Twitter thread here. 

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Much has changed since the first May Day, but building worker power and combating racism and xenophobia remain just as important

May 1 is International Workers’ Day, a day workers around the world mark as Labor Day with marches, demonstrations, and renewed calls for workers’ rights. “May Day” got its start in 1886, when U.S. workers rallied in support of ongoing campaigns for an eight-hour day, setting May 1 as a deadline to begin mass strikes if employers failed to adopt shorter hours.

In 1886 Chicago, where tens of thousands joined May Day actions and thousands went on strike, subsequent police shootings of striking workers escalated into the well-known Haymarket Tragedy. Months of state-sanctioned, anti-immigrant repression of labor organizing followed. Police raids of union halls and arrests of organizers culminated in a sham trial, eight guilty verdicts, and public hanging of four prominent immigrant, working-class movement leaders (a fifth died by suicide prior to the execution date). The trial and executions were followed closely by workers across the country and around the world. In memory of the Haymarket Martyrs, labor and socialist organizations declared May Day International Workers’ Day, now an official public holiday in many countries.

Over 100 years later, our May Day 2022 economy has much in common with that of May Day 1886—rising inequality, economic upheavals affecting those with the least financial security, xenophobia, market concentration, and an upsurge in workers taking matters into their own hands while facing intense employer resistance. U.S. factory workers and railroad workers are still campaigning for shorter hours, in some cases striking (or threatening strikes) to challenge inhumane 12-to-14-hour shifts and unpredictable forced overtime. New generations of workers, including many immigrants, are breaking through barriers of employer union-busting to organize unions in warehouses, hospitalsnursing homes, coffee shops, retail stores, media outlets, universities, and beyond.

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This Workers Memorial Day, honor lives lost by joining workers’ fight for a future that includes safe work

“Our health is just as essential,” read the homemade sign Chris Smalls carried in front of the Amazon JFK8 Staten Island warehouse on March 30, 2020, a moment when it had become clear that exposure to coronavirus could be deadly. After a week of appealing to management for masks, gloves, and a temporary shutdown to sanitize exposed areas, several JFK8 workers walked out and called on Amazon to take steps to protect those inside the warehouse where positive cases were known but not always being reported to employees.

This Workers Memorial Day, policymakers should listen to and follow the lead of workers at Amazon and elsewhere who are organizing to build the power necessary to demand safe work, often in the face of long odds and intense employer union-busting. With pandemic losses still mounting and untold numbers of worker deaths to mourn, it’s past time to ensure effective regulation of workplace safety and the protection of all workers’ rights to form a union.

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Stagnant topcode thresholds threaten data reliability for the highest earners and make inequality difficult to accurately measure

Measuring wage growth, particularly at high wage levels, has become a difficult task. The most useful, publicly-available data for measuring trends in hourly wages is the Current Population Survey (CPS). Analyses from CPS, for example, (like this one here) are a key reason why we know that except for brief periods of decent wage growth for middle- or low-wage workers between 1979 and today, wage growth for most workers has been slow while wage growth for top earners has been far more rapid.

Unfortunately, it is increasingly difficult to report accurate data on top-end wages or wage changes using the CPS because of growing inequality and measurement issues related to top-coding, an earnings reporting method that hasn’t kept up with rising wages for top earners and thus limits measuring of earnings above a certain threshold (and therefore makes it difficult to accurately measure average wages as well). “Topcodes” used in the CPS assign observations that report wages over some threshold the identical “topcoded” value in the data (the current topcode is $2,884.61 in weekly wages). The topcode is not updated annually for inflation or anything else. Consequently, it suppresses a larger and larger fraction of the CPS data over time. If wage-growth for workers who make more than the topcode has been systematically faster than for workers beneath the topcode, we will miss out on just how much wage inequality has risen.

This creates a real problem for assessing overall trends in inequality, because so much income (including wage income) has been concentrated at the very top of distributions. For example, data on annual wage growth from the Social Security Administration that is not topcoded shows substantially more-dramatic growth in inequality than what is apparent in CPS data (see an analysis of this SSA data here). Given that the overwhelming majority of high-wage workers work full-time, it is surely the case that the SSA data for the highest-paid workers is mostly representative of very rapid growth in hourly wages, not hours worked. Yet we cannot really validate this with direct measures of hourly wages available to use in the CPS.

Aside from the problems it presents for interpreting overall trends in inequality, the CPS topcode has radically different implications for analyses of smaller demographic groups. At the Economic Policy Institute (EPI), we provide labor market and wage analysis on our State of Working America Data Library page based on the best available data. When we attempt to analyze wages among demographic groups, by gender, race/ethnicity, and/or education, the parts of the wage distribution we are able to measure is even smaller because more and more observations’ data are suppressed by the topcode.

The failure to adjust the topcode to better capture wages at the high end isn’t a new phenomenon. Between 1973 and 1988, the topcode for weekly earnings was constant in nominal dollars at $999 per week, even as inflation ran in double-digits over some of the intervening years. Then, it stayed at $1,923 per week between 1989 and 1997. The latest change in the topcode was made back in 1998; the current topcode has now sat at $2,884.61 per week in nominal value for the last twenty four years. Even if wages did not grow in real terms and only kept up with inflation, the ability to measure high end wages would be compromised. But, in most years, high end wages grew far faster than inflation, increasing the pace at which wages could not be reliably measured.

The Census Bureau has announced upcoming changes to the top-coding procedure for usual weekly earnings and usual hourly earnings data, which will certainly improve data analysis moving forward. But, there has been no indication that data will be changed historically, which does not solve the problem of trying to uncover high end earnings trends over the last few decades.

We start our display of the topcode issue with an examination of the shares of each demographic group which have been topcoded over time. Figure A displays topcoding shares overall as well as by gender from 1979 to 2021. Figure B displays the same for White, Black, Hispanic, and Asian American and Pacific Islander (AAPI) workers. And, Figure C displays the same trends by educational attainment.

Figure A illustrates the difficulties in measuring between and within group inequality at the high end of the wage distribution resulting from a significant portion of men being topcoded. This is particularly noticeable during 1985–1988 and 2018–2021. The share of men who were topcoded increased sharply through the 1980s, exceeding 5% of workers between 1986 and 1988, and then reached an all-time high of 7.7% in 2021. The higher shares of men topcoded compared to women is not surprising given the fact that they are far more likely to be found in higher paying jobs in the U.S. economy while women continue to face a significant gender pay gap, particularly at the middle and upper portion of the wage distribution, even among women with higher levels of educational attainment.

Figure A

The top 5% of men’s wages have been topcoded in 8 of the last 43 years: Topcode shares by overall and gender, 1979–2021

Year All Men Women
1979 0.6% 1.0% 0.1%
1980 0.7% 1.2% 0.1%
1981 1.0% 1.8% 0.1%
1982 1.4% 2.5% 0.2%
1983 1.8% 3.3% 0.3%
1984 2.3% 3.9% 0.4%
1985 2.7% 4.7% 0.6%
1986 3.2% 5.5% 0.7%
1987 3.7% 6.4% 0.9%
1988 4.5% 7.4% 1.1%
1989 0.5% 0.8% 0.1%
1990 0.6% 1.0% 0.1%
1991 0.7% 1.2% 0.2%
1992 0.7% 1.3% 0.2%
1993 0.8% 1.4% 0.2%
1994 1.2% 2.0% 0.4%
1995 1.3% 2.2% 0.4%
1996 1.4% 2.3% 0.4%
1997 1.7% 2.6% 0.6%
1998 0.6% 1.0% 0.2%
1999 0.7% 1.1% 0.2%
2000 0.8% 1.3% 0.3%
2001 0.9% 1.4% 0.3%
2002 1.0% 1.6% 0.4%
2003 1.1% 1.6% 0.4%
2004 1.2% 1.9% 0.4%
2005 1.3% 2.0% 0.5%
2006 1.5% 2.3% 0.6%
2007 1.7% 2.6% 0.7%
2008 1.9% 3.0% 0.9%
2009 2.1% 3.2% 0.9%
2010 2.3% 3.4% 1.0%
2011 2.3% 3.4% 1.1%
2012 2.6% 3.9% 1.2%
2013 2.8% 4.2% 1.4%
2014 2.9% 4.2% 1.5%
2015 3.2% 4.6% 1.6%
2016 3.5% 4.9% 1.7%
2017 3.7% 5.1% 2.0%
2018 4.2% 6.0% 2.3%
2019 4.6% 6.3% 2.6%
2020 5.4% 7.4% 3.2%
2021 5.8% 7.7% 3.5%
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Notes: The topcode nominal dollar thresholds for weekly earnings have been updated three times since 1973. The topcode value was $999 from 1973–1988, $1923 from 19891997, and has currently sat at $2,884.61 since 1998. 

Source: Authors’ analysis of EPI Microdata Extracts.  

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Figure B makes apparent how the historical and current discrimination against Black and Hispanic workers has meant that they are less likely to be in higher paying jobs, thus leading them to have significantly lower shares of topcoded workers than their AAPI and white counterparts. Between 1979 and 1997, the share of Black and Hispanic workers who were topcoded did not exceed 1.6% for either group, while “other” (largely AAPI) workers and white workers’ shares hit 4.8% and 5.1%, respectively. After the topcode threshold was reset in 1998, Black and Hispanic shares remained low until the last couple of years, hitting 2.5% and 2.6%, respectively. At the same time, AAPI and white workers experienced significant increases in the shares of their workforce hitting the topcode, 10.9% and 6.8%, respectively. Ultimately, the significant increase in topcode shares among AAPI and white workers makes measuring the true high-end wage inequality within and across racial and ethnic groups nearly impossible; in fact, it also makes calculating average wages more challenging—relying more heavily on imputation assumptions—if the upper end is increasingly topcoded.

Figure B

Earnings at the top for AAPI and white workers have been impossible to accurately measure since the mid 2010s: Topcode shares by race/ethnicity, 1979–2021

Year White Black Hispanic AAPI Other
1979 0.6% 0.1% 0.1% 0.4%
1980 0.8% 0.1% 0.3% 0.7%
1981 1.2% 0.2% 0.4% 1.0%
1982 1.6% 0.3% 0.4% 1.9%
1983 2.1% 0.5% 0.6% 2.0%
1984 2.6% 0.7% 0.7% 2.0%
1985 3.1% 0.8% 0.9% 2.5%
1986 3.7% 0.8% 1.1% 3.8%
1987 4.3% 1.2% 1.2% 4.3%
1988 5.1% 1.6% 1.4% 4.8%
1989 0.6% 0.0% 0.2% 0.4% 0.4%
1990 0.7% 0.1% 0.2% 0.8%
1991 0.8% 0.1% 0.2% 0.9%
1992 0.9% 0.1% 0.1% 1.1%
1993 1.0% 0.2% 0.2% 0.9%
1994 1.4% 0.5% 0.4% 1.4%
1995 1.6% 0.3% 0.4% 1.6%
1996 1.7% 0.4% 0.5% 1.8%
1997 2.0% 0.5% 0.5% 2.4%
1998 0.8% 0.2% 0.2% 0.6%
1999 0.9% 0.2% 0.2% 0.7%
2000 1.0% 0.3% 0.3% 1.1%
2001 1.1% 0.3% 0.2% 1.3%
2002 1.3% 0.2% 0.3% 1.4%
2003 1.3% 0.3% 0.3% 1.3%
2004 1.4% 0.3% 0.5% 1.7%
2005 1.6% 0.3% 0.4% 1.6%
2006 1.9% 0.4% 0.4% 2.1%
2007 2.1% 0.6% 0.5% 2.2%
2008 2.4% 0.7% 0.7% 2.8%
2009 2.5% 0.8% 0.8% 2.6%
2010 2.8% 0.8% 0.9% 3.0%
2011 2.8% 1.0% 0.8% 3.2%
2012 3.2% 1.1% 0.9% 3.9%
2013 3.4% 1.1% 1.0% 4.1%
2014 3.5% 1.2% 1.0% 4.6%
2015 3.9% 1.4% 1.3% 5.3%
2016 4.2% 1.6% 1.3% 5.9%
2017 4.5% 1.6% 1.4% 6.2%
2018 5.2% 1.8% 1.6% 6.6%
2019 5.5% 2.1% 1.9% 8.3%
2020 6.4% 2.4% 2.3% 10.3%
2021 6.8% 2.6% 2.5% 10.9%
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Notes: The topcode nominal dollar thresholds for weekly earnings have been updated three times since 1973. The topcode value was $999 from 1973–1988, $1923 from 19891997, and has currently sat at $2,884.61 since 1998. AAPI refers to Asian American and Pacific Islander. Race/ethnicity categories are mutually exclusive (i.e., white non-Hispanic, Black non-Hispanic, AAPI non-Hispanic, and Hispanic any race). Prior to 1989, AAPI was not reported separately and included in “Other.” 

Source: Authors’ analysis of EPI Microdata Extracts.

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Figure C demonstrates how higher levels of educational attainment are related to higher earnings. There is a consistent and significant gap between the topcode share of workers with an advanced or college degree and those with the next highest level of educational attainment (some college experience). In 1988, 20.1% of workers with an advanced degree were topcoded, while the same was true for 11.0% of workers with a college degree. The share of workers with some college experience who were topcoded was only 2.9%. This large gap persisted in 2021, with the topcode shares being 17.0% and 9.3% for workers with an advanced and college degree respectively while workers with some college experience had only 1.9% topcoded. The significant shares of topcoded workers within the advanced degree and college educational attainment groups increases the difficulty of measuring their wages both alone, and in comparison, to other groups.

Figure C

Advanced degree holders' wages exceed 5% topcode share in all but 10 years since 1979: Topcode shares by education, 1979–2021

Year Less than high school High school Some college College Advanced degree
1979 0.1% 0.2% 0.4% 1.6% 3.3%
1980 0.1% 0.2% 0.5% 2.1% 3.8%
1981 0.2% 0.4% 0.7% 3.1% 5.1%
1982 0.2% 0.4% 0.8% 4.0% 7.3%
1983 0.3% 0.5% 1.1% 5.1% 9.1%
1984 0.3% 0.7% 1.5% 6.1% 11.2%
1985 0.4% 0.9% 1.9% 6.8% 13.0%
1986 0.3% 1.0% 2.2% 8.3% 15.3%
1987 0.4% 1.1% 2.6% 9.6% 17.6%
1988 0.6% 1.4% 2.9% 11.0% 20.1%
1989 0.0% 0.1% 0.3% 1.1% 2.7%
1990 0.1% 0.1% 0.3% 1.3% 3.4%
1991 0.0% 0.1% 0.3% 1.5% 4.3%
1992 0.0% 0.1% 0.3% 1.7% 4.5%
1993 0.0% 0.1% 0.3% 1.8% 5.1%
1994 0.2% 0.3% 0.5% 2.7% 6.8%
1995 0.1% 0.2% 0.5% 2.9% 7.7%
1996 0.1% 0.2% 0.6% 3.0% 7.8%
1997 0.1% 0.4% 0.7% 3.6% 8.9%
1998 0.1% 0.1% 0.3% 1.3% 3.3%
1999 0.1% 0.1% 0.2% 1.6% 3.7%
2000 0.0% 0.1% 0.3% 1.8% 4.1%
2001 0.1% 0.1% 0.3% 2.1% 4.2%
2002 0.1% 0.2% 0.4% 2.2% 4.9%
2003 0.1% 0.2% 0.4% 2.3% 4.8%
2004 0.1% 0.3% 0.4% 2.3% 5.7%
2005 0.1% 0.2% 0.5% 2.6% 5.9%
2006 0.1% 0.3% 0.5% 2.9% 6.9%
2007 0.1% 0.3% 0.6% 3.3% 7.3%
2008 0.1% 0.5% 0.7% 3.6% 8.0%
2009 0.2% 0.4% 0.7% 3.7% 8.9%
2010 0.2% 0.5% 0.7% 4.2% 8.9%
2011 0.2% 0.5% 0.8% 4.1% 8.9%
2012 0.2% 0.5% 0.7% 4.6% 10.5%
2013 0.2% 0.5% 0.8% 5.0% 10.6%
2014 0.2% 0.6% 0.9% 5.0% 10.6%
2015 0.3% 0.8% 1.2% 5.5% 10.9%
2016 0.2% 0.7% 1.0% 6.1% 11.9%
2017 0.4% 0.8% 1.0% 6.4% 12.3%
2018 0.4% 1.0% 1.3% 6.8% 14.1%
2019 0.4% 1.0% 1.4% 7.5% 14.8%
2020 0.4% 1.2% 1.8% 8.4% 16.3%
2021 0.5% 1.2% 1.9% 9.3% 17.0%
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Notes: The topcode nominal dollar thresholds for weekly earnings have been updated three times since 1973. The topcode value was $999 from 1973–1988, $1923 from 19891997, and has currently sat at $2,884.61 since 1998. 

Source: Authors’ analysis of EPI Microdata Extracts. 

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Of course, the difficulties of measuring high end earnings are even more acute when we look at demographic groups that cut across gender, race/ethnicity, and education.

Figure D makes the power of intersectionality evident. Workers who identify with the groups with the largest topcode shares across gender, race, and education have earnings which are by far the most difficult to measure. Men (7.7%), AAPI workers (10.9%), and those with advanced degrees (17.0%) have the largest topcode shares of their respective demographic groups. However, when you examine these demographics in combination, AAPI men with advanced degrees, the share of workers who are topcoded is even more significant (29.2%). The group with the second largest topcode shares across all combinations of gender, race, and education are white men with advanced degrees (25.6%). For these groups, and all those displayed in Figure D, high-end earnings are exceedingly difficult to measure due to large topcode shares.

Figure D

For some demographic groups, even 85th percentile wages are not measurable: Topcode shares for specific groups, 2021

Share for specific groups
All 5.8%
White women, advanced degree 10.1%
AAPI men, college degree 13.1%
White men, college degree 14.9%
AAPI women, advanced degree 15.1%
Black men, advanced degree 15.6%
Hispanic men, advanced degree 18.8%
White men, advanced degree 25.6%
AAPI men, advanced degree 29.2%
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Notes: The topcode nominal dollar thresholds for weekly earnings have been updated three times since 1973. The topcode value was $999 from 1973–1988, $1923 from 19891997, and has currently sat at $2,884.61 since 1998. AAPI refers to Asian American and Pacific Islander. Race/ethnicity categories are mutually exclusive (i.e., white non-Hispanic, Black non-Hispanic, AAPI non-Hispanic, and Hispanic any race). 

Source: Authors’ analysis of EPI Microdata Extracts. 

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See our State of Working America Data Library page for wages by percentile, including NA’s for percentile values that can’t be reliably measured.

It’s unfortunate that policy has not made a significant contribution to reining in rising wage inequality over these years. But allowing rising inequality to mechanically obscure even its own measurement seems truly absurd, and yet extremely easy to fix. The BLS should commit to higher and far more regularly-updated topcodes, or find some other way to allow researchers to get a clearer sense of what is happening to wage inequality than what the CPS currently allows.

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Corporate profits have contributed disproportionately to inflation. How should policymakers respond?

The inflation spike of 2021 and 2022 has presented real policy challenges. In order to better understand this policy debate, it is imperative to look at prices and how they are being affected.

The price of just about everything in the U.S. economy can be broken down into the three main components of cost. These include labor costs, nonlabor inputs, and the “mark-up” of profits over the first two components. Good data on these separate cost components exist for the nonfinancial corporate (NFC) sector—those companies that produce goods and services—of the economy, which makes up roughly 75% of the entire private sector.

Since the trough of the COVID-19 recession in the second quarter of 2020, overall prices in the NFC sector have risen at an annualized rate of 6.1%—a pronounced acceleration over the 1.8% price growth that characterized the pre-pandemic business cycle of 2007–2019. Strikingly, over half of this increase (53.9%) can be attributed to fatter profit margins, with labor costs contributing less than 8% of this increase. This is not normal. From 1979 to 2019, profits only contributed about 11% to price growth and labor costs over 60%, as shown in Figure A below. Nonlabor inputs—a decent indicator for supply-chain snarls—are also driving up prices more than usual in the current economic recovery.

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Child care and elder care investments are a tool for reducing inflationary expectations without pain

Inflation is by far the biggest economic concern facing the U.S. economy today. While job growth is historically rapid and survey evidence indicates that workers think now is the best time in years to find a good job, the inflation surge has kept this labor market strength from translating into higher wages and incomes for most households. The most well-known tool to restrain inflation—higher interest rates engineered by the Federal Reserve—is potentially very costly if it leads to higher unemployment and a weaker labor market.

Given all of this, policymakers should look for any tool that can help restrain inflationary pressures without causing significant collateral damage. One such tool could be investments in child care and elder care. By subsidizing families’ use of child care and elder care and providing direct investments to providers, such investments could boost future labor supply by allowing working-age parents and children who want to look for paid employment to do so while remaining confident their family members are receiving care. Further, these investments can help dampen inflationary pressures—that rising wages could in theory contribute to—even well before they fully take effect.  

To understand why, one must realize that developments in the labor market will likely determine just how easily (or not) inflationary pressures can be lowered in the next year or so. The inflationary spike that began in 2021 didn’t start in the labor market—it started in commodities and in supply-chain-snarled durable goods sectors where wage growth was actually slower than in other parts of the economy. But going forward, whether or not the Federal Reserve needs to start applying ever-stronger medicine (with deeply damaging side effects) to slow inflation depends on what happens in labor markets. Specifically, it depends on whether or not the initial inflationary shock leads to unsustainably large wage increases that push up inflation even further, leading to wage-price spirals of the sort that characterized the 1970s.

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March jobs report shows strong growth as the labor market continues to recover at a rapid pace

Below, EPI economists offer their initial insights on the jobs report released this morning, which showed 431,000 jobs added in March.

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Job Openings and Labor Turnover Survey: Job openings were little changed while hires edged up

Below, EPI senior economist Elise Gould offers her initial insights on today’s release of the Job Openings and Labor Turnover Survey (JOLTS) for February. Read the full Twitter thread here.

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Biden can fix the anti-worker H-1B immigration visa scam

This is an excerpt from an op-ed in Jacobin. Read the full op-ed here.

Every April 1, the government decides, via lottery of all methods, which employers will get new visas for the H-1B, a temporary work program that has inflicted serious harm on millions of workers over the past three decades.

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Enforcers take action to protect building superintendents and grocery and construction workers: A snapshot of state and local enforcement actions across the country

Series: The New Labor Law Enforcers

State attorneys general, district attorneys, and localities like cities are increasingly key players in protecting workers’ rights. This new series by Terri Gerstein provides snapshots of enforcement and other actions to protect workers’ rights by these new and emerging labor law enforcers at the state and local level. Gerstein is an EPI senior fellow and director of the state and local enforcement project at the Harvard Labor and Worklife Program, who has chronicled the growing influence of these new enforcers.  

Recent cases brought by state and local enforcers include the recovery of $130,000 for New York City building superintendents, who were paid no wages at all, and a recovery of nearly $220,000 for workers in a Seattle specialty bar and grocery store based on minimum wage and paid sick leave violations. In addition, prosecutors on both sides of the country took action against contractors in the construction industry: The King County (WA) prosecuting attorney concluded a case in which a worker was killed in a preventable trench collapse, while the Manhattan district attorney indicted several interior construction companies and their owners for a conspiracy to evade more than $1.7 million in workers’ compensation premiums.

Here’s a snapshot of some enforcement actions in February and March 2022.

The New York Attorney General (AG) announced the settlement and recovery of $130,000 in a case involving building employers that failed to pay live-in superintendents any wages at all, and compensated them only through providing lodging (which was needed to perform the job).

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The Biden administration can stop H-1B visas from fueling outsourcing: Half of the top 30 H-1B employers were outsourcing firms in 2021

Key takeaways:

  • Through its flawed interpretation of the law and lax enforcement, the U.S. government has made the H-1B—the U.S.’s largest temporary work visa program—the “outsourcing visa.” New data show that half of the top 30 H-1B employers in 2021 were outsourcing firms that underpay migrant workers and offshore U.S. jobs to countries where labor costs are much lower.
  • The 15 top outsourcing firms alone were issued 21,550 H-1B visas, 25% of the annual limit. Amazon, which is not an outsourcing firm, took the top spot with nearly 6,200 new H-1B workers, but the next four were outsourcing firms: Infosys, Tata, Wipro, and Cognizant.
  • President Joe Biden should implement regulations that would prevent outsourcing companies from exploiting the program.

With approximately 600,000 workers, the H-1B is the largest temporary work visa program in the United States—an important program that allows U.S. employers to hire college-educated migrant workers. However, the H-1B program is not operating as intended and needs to be fixed. Instead of being used to fill genuine labor shortages in skilled occupations without negatively impacting U.S. labor standards, the latest data show that the H-1B’s biggest users are companies that have an outsourcing business model that exploit the program by underpaying skilled migrant workers. President Biden can and should implement regulations that would prevent such exploitation.

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Building back better means raising wages for public-sector workers

Key takeaways

  • Thanks to federal recovery funds, state and local policymakers have substantial additional resources to invest in their communities—and they should invest in raising pay for their own employees.
  • Many of the workers providing public services are paid low wages. Roughly one-third of state and local government workers are paid less than $20 an hour, and more than 15% are paid less than $15 an hour.
  • Black and Latinx employees are especially likely to be paid inadequate wages in the public sector. Investing in public services can promote greater racial equity in pay.

The COVID-19 pandemic presented a massive crisis that demanded a large collective response. At times, strong government action—mask mandates, expanded unemployment insurance, stimulus checks, free vaccines—saved lives and livelihoods. At the same time, past underinvestment in public services exacerbated suffering as hospitals were overwhelmed, unemployment claims processing stalled, and schools struggled to adjust to remote learning. Now, thanks to federal recovery funds administered through the American Rescue Plan Act (ARPA) in 2021, state and local policymakers have substantial additional resources to invest in their communities, whether that means preparing for the next unexpected disaster or strengthening the services that help individuals and families through their own difficult times.

Investing in these services also means investing in the workers who carry them out, far too many of whom are paid low wages for their valuable work in providing public education, delivering health services and pandemic response, administering programs such as unemployment insurance, keeping our roads and sewers safe, and getting commuters to work. This blog post presents data quantifying and describing these public-sector workers and shows that Black and Latinx employees are especially likely to be paid inadequate wages.

The U.S. Department of the Treasury is encouraging states and localities to use federal recovery funds with equity in mind. To advance this goal, states and localities should invest in improving pay for their own employees who ensure social needs are met, especially lower-paid state and local employees, many of whom are women of color.

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One year in, the American Rescue Plan has fueled a fast recovery: Policymakers should use remaining ARPA funds in 2022 to make transformative investments that will build a more equitable economy

March 11 marks the one-year anniversary of the signing of the American Rescue Plan Act (ARPA). This $1.9 trillion dollar relief package was both an emergency measure to help the nation through the worst pandemic in a century and an ambitious catalyst to jump-start efforts to redress the staggering economic inequalities in our economy. In its first year, ARPA helped the economy recover at a tremendous pace and aided working families through difficult times. In the year to come, state and local policymakers will have critical opportunities to use their substantial remaining ARPA funds to rebuild the public sector, support low-wage workers, and target systemic inequities.

ARPA supported a year of strong growth

A full labor market recovery took more than a decade after the Great Recession began in late 2007. Federal stimulus, needed to restart the economy in times of recession, was inadequate to circumstances throughout the 2010s. The slow recovery of the economy during the Great Recession also gave ammunition to political forces that supported austerity, the dismantling of labor unions, and the continued weakening of the social safety net.

With inadequate federal fiscal aid, many states faced large budget shortfalls in the wake of the Great Recession, and many state and local lawmakers responded by dramatically slashing budgets and cutting jobs. These cuts to state and local government had a disproportionate impact on women and Black and Hispanic workers, who are more likely to be employed in the public sector. This austerity was not only unnecessary, it also directly contributed to the slow pace of the economic recovery.

This long period of anemic growth also meant a lost decade of potential wage growth for low-income and middle-income workers, and racial employment and wage gaps continued to expand.

Along with COVID-related legislation like the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in 2020, ARPA has gone a long way to making sure the mistakes of the Great Recession were not repeated. Tens of millions were kept out of poverty because of social insurance programs from CARES, ARPA, and other relief legislation. Despite a catastrophic cratering of the economy in March 2020—with more than 20 million jobs lost—the country is on track to return to pre-COVID levels of employment before the end of 2022 (Figure A).

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Equal Pay Day: There has been little progress in closing the gender wage gap

March 15 is Equal Pay Day, a reminder that there is still a significant pay gap between men and women in our country. The date represents how far into 2022 women would have to work to be paid the same amount that men were paid in 2021. Women were paid 22.1% less on average than men in 2021, after controlling for race and ethnicity, education, age, and geographic division.

What’s particularly troubling is there has been little progress in closing the gender wage gap over much of the last three decades, as shown in the figure below. The regression-adjusted pay gap narrowed between 1979 and 1994—falling from a 37.7% pay penalty to a 23.2% pay penalty. But the entirety of the narrowing gap between 1979 and 1994 can be attributed to men’s stagnant wages, not a tremendous increase in women’s wages. Since then, the gap between men’s and women’s pay has narrowed hardly at all. In 2021, the pay gap remained at 22.1%.

Figure

Little to no progress in closing the gender wage gap in three decades: Regression-adjusted gender wage gap, 1979–2021

Date Regression-adjusted gender wage gap
1979 37.7%
1980 36.8%
1981 35.7%
1982 34.5%
1983 33.4%
1984 33.1%
1985 32.8%
1986 32.6%
1987 31.9%
1988 31.2%
1989 28.6%
1990 27.3%
1991 25.6%
1992 24.1%
1993 23.3%
1994 23.2%
1995 24.1%
1996 23.4%
1997 23.8%
1998 23.4%
1999 24.0%
2000 23.9%
2001 23.2%
2002 22.5%
2003 22.3%
2004 22.6%
2005 22.1%
2006 22.4%
2007 22.8%
2008 22.7%
2009 22.5%
2010 21.3%
2011 20.7%
2012 22.0%
2013 21.4%
2014 21.2%
2015 21.7%
2016 21.9%
2017 21.6%
2018 22.6%
2019 22.6%
2020 23.0%
2021 22.1%
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Notes: Wages are adjusted into 2021 dollars by the CPI-U-RS. The regression-based gap is based on average wages and controls for gender, race and ethnicity, education, age, and geographic division. The log of the hourly wage is the dependent variable.

Source: Author’s analysis of Current Population Survey, Outgoing Rotation Group (CPS-ORG), 1979–2021, and Economic Policy Institute, Current Population Survey Extracts, Version 1.0.26 (2022), https://microdata.epi.org/, 1979–2022. 

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Over this period of pay gap stagnation, women have consistently increased their investments in education to increase their pay. Back in 1994, as progress toward closing the gender wage gap stalled, men were more likely to have a college or advanced degree than women. A quarter of men (25.1%) had at least a four-year college degree compared with 23.8% of women. By 2021, women’s educational attainment had surpassed men’s educational attainment. In 2021, 37.4% of men and 43.8% of women had at least a college degree. Unfortunately, even with these advances in educational attainment, women still face a stark pay gap. Women with advanced degrees are paid less, on average, than men with bachelor’s degrees.

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Job Openings and Labor Turnover Survey: Hires and separations were little changed as quits declined

Below, EPI senior economist Elise Gould offers her initial insights on today’s release of the Job Openings and Labor Turnover Survey (JOLTS) for January. Read the full Twitter thread here.

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Jobs report: The labor market continues its strong and speedy recovery because federal relief matched the scale of the crisis

Below, EPI economists offer their initial insights on the jobs report released this morning. The report showed a strong 678,000 jobs added in February, for a total of 7.9 million jobs added since the end of 2020.

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What to watch on jobs day: The economy is recovering fast because federal relief matched the scale of the crisis

This is an excerpt from an op-ed in CNN Business. Read the full op-ed here.

When the coronavirus pandemic shut down businesses in spring 2020, the labor market lost 22 million jobs in just two months—more than twice as many jobs lost during the entire Great Recession and financial crisis of 2008–2009. Given that a full labor market recovery from the Great Recession took a decade, there were sincere worries that Covid-19’s economic wound could take even longer to heal. But because we undertook a radically different—and better—policy response to the latest crisis, the labor market is far healthier today than anybody expected it would be in those grim early days of the pandemic.

Over the last 12 months, the economy has added 6.6 million jobs, an astonishing pace. And while there is still a significant gap in the labor market, we are on track to return to pre-pandemic labor market conditions before the end of 2022—a recovery that is roughly eight years faster than the recovery from the Great Recession, as shown in the figure below.

Figure A

Federal fiscal relief at the scale of the problem led to a faster recovery from the pandemic recession: Private-sector employment change since business cycle peak, December 2007 and February 2020

Months since peak 2007 2020
0 100 100
1 99.999138 98.8860174
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18 93.4629706 96.2838959
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21 92.9121845 97.6185149
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Congress should boost NLRB funding to protect workers’ well-being

The National Labor Relations Board (NLRB) enforces the National Labor Relations Act (NLRA), the nation’s fundamental labor law that guarantees most private-sector workers the right to organize and the right to collective bargaining. Years of static funding has undermined the Board’s ability to fulfill its statutory mission, to the detriment of workers and the economy. The chronic under-resourcing of the Board has created challenges in its enforcement capacity amid the surge of union interest—and unfair labor practices. As Congress debates upcoming budget and spending legislation, it is critical that lawmakers boost NLRB funding to protect workers’ well-being.

NLRB funding has remained flat

The Board’s staffing level has not kept up with the growth in the national private-sector workforce. The number of full-time employees at the NLRB dropped by nearly 31% from 1,789 to 1,320 between 2006 and 2019. During the same period, the number of covered workers per NLRB staff increased by 50%, from one full-time employee per 74,809 workers to one full-time employee per 112,201 workers, as shown in the figure below. Further, staffing levels at regional offices, which typically handle the intake of complaints filed by workers, dropped by 33% between 2010 and 2019.

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Enforcers take action to protect workers from workplace violations at Domino’s and Family Dollar stores: A snapshot of state and local enforcement actions across the country

Series: The New Labor Law Enforcers

State attorneys general, district attorneys, and localities like cities are increasingly key players in protecting workers’ rights. This new series by Terri Gerstein provides snapshots of enforcement and other actions to protect workers’ rights by these new and emerging labor law enforcers at the state and local level. Gerstein is an EPI senior fellow and director of the state and local enforcement project at the Harvard Labor and Worklife Program, who has chronicled the growing influence of these new enforcers.  

Recent cases brought by state and local enforcers include the recovery of $2 million for workers of a Seattle Domino’s franchisee that underpaid workers and didn’t give required notice of schedules; citation of Massachusetts Family Dollar stores for $1.5 million for thousands of meal break violations; and prosecution of several cases involving egregious violations of wage payment, unemployment insurance, and workers’ compensation laws.

Here’s a snapshot of some enforcement actions in early 2022.

The Seattle Office of Labor Standards obtained a $2 million settlement with a Domino’s franchisee that violated fair workweek, minimum wage, and overtime laws. The employer, with 14 locations in Seattle and more than 30 through the Puget Sound area, allegedly violated the city’s Secure Scheduling Ordinance, which requires large retail and food service employers to provide workers with their schedules at least 14 days in advance and provide workers with good-faith estimates of their work schedules, among other requirements. Domino’s also allegedly paid below Seattle’s minimum wage for all time worked in Seattle, and didn’t pay overtime when workers were assigned to multiple locations for over 40 hours per week. The Seattle Office of Labor Standards also reached a settlement for more than $250,000 with a national traffic control company that paid below the city’s minimum wage, among other violations.Read more