The Federal Arbitration Act is a 100-year-old law that was initially designed to be a cost effective way for business entities to resolve disputes. A series of Supreme Court decisions beginning in the 1990s expanded its scope. In 1992, just 2 percent of U.S. workers were subject to mandatory arbitration clauses. By 2018, more than 56 percent were, or roughly 60 million workers, according to the Economic Policy Institute.
The 19th
July 16, 2021
This executive order comes as noncompetes are on the rise across the country, with anywhere between 27% and 46% of all private-sector workers subject to the agreements, according to a 2019 survey by the Economic Policy Institute. Though broadly intended to discourage employees from taking trade secrets along with them when they switch jobs, noncompete clauses are increasingly worked into jobs across the economic scale.
LA Times
July 16, 2021
Black workers are especially underrepresented in industries and occupations with the fastest growth in pay. Valerie Rawlston Wilson…[Paywall]
USA Today
July 16, 2021
According to a 2019 report from the Economic Policy Institute (EPI), 31.8% of private-sector businesses that responded to EPI’s survey (a total of 634 respondents were surveyed) reported that all of their employees had to sign a non-compete agreement, regardless of their job duties or compensation. And of the respondents that had an average wage of less than $13.00, 29% of them required all their workers to enter into non-compete agreements.
Forbes
July 16, 2021
For more than three decades, our friends at the Economic Policy Institute have been waging a lonely struggle against the conventional wisdom about the causes of widening inequality. They did not have powerful allies on their side. All they had was reality.
Now, EPI’s research has been vindicated, and is increasingly accepted by mainstream economists. Wage inequality is the result of deliberate suppression of wages, which in turn is the result of a deepening power inequality.
Even better than having reality on their side, EPI economists now have a Democratic administration on their side. Several senior Biden people, including Jared Bernstein and Heather Boushey on the Council of Economic Advisers, are former EPI staffers, and EPI’s insights are at last influencing national policy.
EPI pulled together all of this research in a document called “Unequal Power.”
I recently had a Zoom conversation with former EPI president Larry Mishel, the leader of this research project, along with professors Anna Stansbury of MIT and Suresh Naidu of Columbia University, to discuss the findings. You can watch the interview below:
The American Prospect
July 16, 2021
Union membership has neared all-time lows across the US, while income inequality has widened, according to the Economic Policy Institute, a progressive think tank.
A report from the organisation earlier this year found that the annual median income for a full-time worker is $3,250 less than similar work in 1979 amid declining union enrollment.
The Independent
July 16, 2021
As union membership approaches all-time lows in recorded history, income inequality is now worse than it’s been since the Great Depression, according to the Economic Policy Institute (EPI). Indeed, workers are feeling the effects — an EPI report earlier this year found that the median full time worker is making $3,250 less per year than in 1979 because of declining unionization.
Truthout
July 16, 2021
Each year, minimum-wage violations by California employers sap the state’s workforce of nearly $2 billion in earnings, worsening conditions for the financially vulnerable and dragging down the state’s overall economic health, according to nonprofit think tank the Economic Policy Institute.
WWD
July 16, 2021
“For non-unionized workers, which are the vast majority of workers in this sector, the only source of economic leverage they have with respect to their employers is their implicit ability to quit their job and go find a better one,” Economic Policy Institute economist Heidi Shierholz explained to the media outlet.
Mashed
July 16, 2021
According to the Economic Policy Institute, companies get caught violating federal law in 41.5 percent of all NLRB-supervised elections; another study found that nearly 20 percent of union activists get fired during union election campaigns.
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The PRO Act adds what amounts to a $100,000 civil penalty for any illegal discharge or other serious economic harm to an employee. If such penalties had been in place during the past 10 years, they would have raised as much as $1.8 billion in revenue (per EPI numbers).
Washington Monthly
July 16, 2021
How far will those payments go toward childcare? Here are the average monthly childcare costs for four-year olds nationwide, according to the Economic Policy Institute:
- California: $956
- Texas: $589
- New York: $1,030
- Wisconsin: $850
- Massachusetts: $1,258
- Washington D.C.: $1,593
- Arkansas: $457
- Florida: $607
- Oregon: $838
Fast Company
July 16, 2021
Where she lives, in central Pennsylvania, the Economic Policy Institute figures that with no child care costs, she would need about $49,000 to have a modest yet adequate standard of living. Harri will have a little more than that. Bringing in $53,600 will not provide her with a life of luxury, but the magnitude of that change should be transformative for Harri and her children.
In These Times
July 16, 2021
Trade unions will only bid up wages for their members at the expense of employment for everyone else. Pay rises must be limited to what productivity can support, and if we go beyond that, inflation must result. How then do we shake the folk model out of our heads? Josh Bivens, at the Economic Policy Institute, has written a piece that seeks to do just that.
The Guardian
July 16, 2021
A Democratic-controlled board could reverse that and speed up the union election process, said Celine McNicholas with the Economic Policy Institute.
“Standard timelines, preventing unnecessary litigation from occurring before an election actually is held … those would make real differences,” McNicholas said.
Marketplace
July 16, 2021
Yahoo Money explains:
Noncompete agreements prevent workers from going to a competitor or starting a competing business within a certain period after leaving their previous job. Between 36 million and 60 million private-sector workers were subject to noncompete agreements in 2019, according to estimates by the Economic Policy Institute.
“The only economic leverage that non-unionized workers have is the implicit threat that they could quit and go somewhere else,” Heidi Shierholz, senior economist and director of policy at the Economic Policy Institute, told Yahoo Money. “Noncompete agreements reduce wages. Your employer doesn’t have to pay you bigger wages if they know that you don’t have outside options.”
Limiting noncompete agreements or making them unenforceable — as Biden’s order sets out to do — may not be enough, according to Shierholz. Banning them instead would give workers more leverage, she said.
Poynter
July 16, 2021
Presidential leadership sets the tone for how – or if – the nation confronts the contradiction between American ideals of freedom, justice, and democracy and the reality that race is a predictor of social and economic status far too often. In that respect, the significance of the Biden administration’s stated commitment to advancing racial equity as one of the first official actions in office should not be understated. Through Executive Order 13985, the administration has sought to promote fairness and impartial treatment, specifically with respect to access to federal programs and participation in federal contracting and procurement.
This marks just one step on what must be a longer path toward a full conception of racial equity that also includes racial justice – steps to redress past exclusion and injustice –as a major component. A more expansive vision of racial equity would seek to address the root causes of racial disparities that lead to underserved communities’ greater need for federal programs, including government actions that curtailed Black Americans’ prospects for building and maintaining intergenerational wealth. Ultimately, real progress toward racial equity will be measured by the extent to which we can reduce, if not eliminate, racial disparities in economic outcomes.
The Biden administration alone is not expected to fully resolve issues that have been centuries in the making, but the president should continue to build on this executive order and implement policies that measurably advance racial equity.
The Guardian
July 16, 2021
To get clarity on some of these questions, Teen Vogue speaks with Heidi Shierholz, senior economist and director of policy at the Economic Policy Institute.
What defines a recession?
Teen Vogue
July 16, 2021
During his speech, Biden said that “at least one in three businesses require their workers to sign a noncompete agreement.” He is citing a survey, published in 2019 by the Economic Policy Institute (EPI), of 634 business establishments with 50 or more employees in a variety of industries.
The survey found that nearly a third, 31.8%, of responding establishments said that all employees in their establishment were required to enter into a noncompete agreement, regardless of pay or job duties. Nearly half, 49.4%, reported that at least some employees were required to enter into a noncompete agreement.
Interestingly, more than a quarter — 29% — of responding establishments where the average wage is less than $13 an hour used noncompetes for all their workers.
Washington Post
July 16, 2021
Most of the base salary cuts made by executives in 2020 were “a public relations gimmick” and “almost inconsequential,” said Lawrence Mishel, a distinguished fellow at the Economic Policy Institute who has studied executive compensation.
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Still, Mishel said “the compensation number reported to the SEC is a legitimate description of the compensation of that executive.”
Los Angeles Times
July 16, 2021
“To replace him now would be a signal something is fundamentally wrong, and I don’t think they think that,” said Josh Bivens, research director at the Economic Policy Institute, a pro-labor research group that contributed to the Fed’s debate over how to reshape monetary policy to encourage more employment. “Powell has made a very big step forward in making the Fed a progressive force.”
Reuters
July 16, 2021
The fact sheet cites research from the Economic Policy Institute, a progressive think tank, which found that nearly half of organizations in an EPI survey said that at least some of their employees were required to enter non-compete agreements. Nearly a third of respondents in the survey said all employees at their establishments were required to do so.
HR Dive
July 16, 2021
“The Atlanta Fed measure is showing that while in general in this measure of wages that controls for composition bias, wage growth is actually lower if you look economy-wide than it was before the recession hit,” Heidi Shierholz, senior economist and director of policy at the Economic Policy Institute, told Insider.
That is, for “people who’ve remained employed, their wages are growing more slowly than they were before the recession,” Shierholz said.
The Economic Policy Institute’s Shierholz and Josh Bivens wrote in a recent analysis using this data that “overall wage growth fell in the first 15 months of the COVID-19 recession, largely in line with trends in the previous two recessions.”
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Shierholz told Insider that labor shortages and strong wage growth are really just in select industries right now, such as leisure and hospitality. This industry has been especially affected by the pandemic and is slowly making employment gains back to pre-pandemic levels.
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Shierholz said the wage growth we’re seeing in this industry is likely temporary, but there are ways to give workers more permanent “economic leverage.” Two ways, she said, are to pass a $15 minimum wage and the Protecting the Right to Organize Act, or the PRO Act.
Business Insider
July 16, 2021
Analysts at the Economic Policy Institute calculated in 2019 that American workers were losing out on roughly $200 billion each year in pay and benefits that they could have had under collectively bargained union contracts. (President Joe Biden’s White House has also taken to citing this EPI study, according to the May 13 Reuters article and a May 14 report by Business Insider).
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U.S. employers are charged with violating federal labor law in 41.5% of all union election campaigns, and they spend about $340 million annually on “union avoidance” consultants who work to prevent unionization, according to a 2019 report by the Economic Policy Institute. In the recent analysis, Reuters reported that workers “often fear that retailers will move to close stores and warehouses or fire people who try to organize.”
Reuters
July 16, 2021
As corporate tax obligations have declined, CEO pay has skyrocketed. According to Office of Management and Budget data and Economic Policy Institute research, when corporate tax receipts made up 21.8 percent of all federal revenue in 1965, the average CEO-to-median worker pay ratio was 21 to 1. After the 2017 Republican tax cuts, corporations plowed significant windfalls into stock buybacks and executive bonuses. By 2019, corporate tax receipts had fallen to just 6.6 percent of federal revenue and the average pay ratio had risen to 320 to 1.
Counterpunch
July 16, 2021
But Elise Gould, senior economist at the left-leaning Economic Policy Institute, disputes that the labor market was all that tight to begin with. “We still have a huge jobs shortfall,” she told me via email, but “the data suggests that the hole is filling in rather steadily.” Subtract from new May hires all the firings and resignations that occurred that month, she noted, and that nets 609,000 jobs. That’s significantly higher than the 462,000 average for March, April, and May. And of course payroll employment has been rising for months. May’s quits rate of 2.5 percent, Gould said, isn’t much higher than it was before the pandemic tanked the economy; from October 2019 through February 2020 the quits rate was 2.3 percent.
New Republic
July 16, 2021
Research from the left-leaning Economic Policy Institute shows that tens of millions of workers in industries like construction and hospitality are required to sign non-compete agreements when they get hired. In fact, roughly half of all private-sector businesses require at least some of their employees to sign such agreements, and a third of businesses require all employees to do so, regardless of their job title or responsibilities.
Money
July 16, 2021
According to the Economic Policy Institute, almost half — or 49.4% to be exact — of all businesses ask employees upon hiring to sign a noncompete contract that effectively prohibits where a person can work in the future or for whom. And while it may be more standard for chief executives or corporate higher-ups with access to sensitive trade secrets, noncompete clauses have increasingly become de rigeuer in the lower ranks of the workforce as well.
Courthouse News Service
July 16, 2021
Heidi Shierholz, director of policy at the Economic Policy Institute (EPI), said Thursday that “noncompetes are ubiquitous, harmful to wages and to competition, and part of a growing trend of employers requiring workers to sign away their rights.”
Truthout
July 16, 2021
The justification for the 2017 tax cuts was that lower taxes on companies would create more jobs and enable growth. But according to a study from the Economic Policy Institute, companies paying minimal corporate taxes were actually more likely to cut their workforce. The report also showed no data to support the idea that lower tax rates encourage investments or broader economic growth.
The Hill
July 16, 2021