Even Worse for Young Workers
The employment situation in the U.S. is, if anything, worse than most people realize. And huge numbers of young people, ages 16 to 30, are being beaten down in ways that could leave scars for a lifetime.
Much of the attention in this economic downturn has focused on the growing legions of men and women who are officially counted as unemployed. There are now more than 11 million of them.
But a better picture of the economic distress related to employment emerges when the number of jobless Americans is combined with two other categories of workers: the underemployed (those who are working part time, for example, because they can’t find full-time work) and the so-called labor force reserve, workers who have abandoned their job searches but who would work if employment became available.
This total pool of underutilized labor has now risen above 24 million, according to researchers at the Center for Labor Market Studies at Northeastern University in Boston. That total will only grow in the coming months.
The Obama administration has more than enough on its plate at the moment, but before long it will likely have to consider a range of additional strategies, beyond the recently passed stimulus package, for putting jobless Americans to work.
A comparison of the number of people being thrown out of work in this recession with that of the severe recession of 1981-82 will indicate why. The peak unemployment rate was higher in that earlier recession than today’s 7.6 percent, largely because the last big wave of the baby-boom generation was entering the job market in the early ’80s. Those boomers who couldn’t find work were officially counted as unemployed.
What is different and more frightening about the current downturn is the number of people actually losing their jobs — being laid off or fired. That number is dramatically, dangerously higher.
The government uses two different surveys to gauge employment data. The household survey, based on telephone interviews, showed that job losses in the 13 months that followed the beginning of the 1981-82 recession reached 1.53 million. In the first 13 months of this recession, the number of jobs lost, according to the household survey, has been a staggering 4 million.
The payroll survey, which is based on employment records, showed job losses of 1.7 million in the first 13 months of the earlier downturn compared with 3.5 million in the current recession.
Pick your poison. This is not the kind of downturn Americans are used to.
The ones who are being hit the hardest and will have the most difficult time recovering are America’s young workers. Nearly 2.2 million young people, ages 16 through 29, have already lost their jobs in this recession. This follows an already steep decline in employment opportunities for young workers over the past several years.
Good jobs were hard to find for most categories of workers during that period. One of the results has been that older men and women have been taking and holding onto jobs that in prior eras would have gone to young people.
“What we’ve seen over the past eight years, for young people under 30, is the largest age reversal with regard to jobs that we’ve ever had in our history,” said Andrew Sum, the director of the Center for Labor Market Studies. “The younger you are, the more you got pushed out of this labor market.”
There were not enough jobs to go around before the recession took hold. So the young, the poor and the poorly educated were already suffering. Now that pool of suffering is rapidly expanding.
This has ominous long-term implications for the country. The economy cannot perform well with such a large cohort of young people condemned to marginal economic status.
Young men and women who remain unemployed for substantial periods of time find it very difficult to make up that ground. They lose the experience and training they would have gained by working. Even if they eventually find employment, they tend to lag behind their peers when it comes to wages, promotions and job security.
Moreover, as the economy worsens, even the college educated are feeling the crunch.
According to a report by researchers working with Mr. Sum: “While young college graduates have fared the best in maintaining some type of employment, a growing fraction of them are becoming mal-employed, holding jobs in occupations that do not require much schooling beyond high school, often displacing their less-educated peers.”
Employment problems have festered in the United States for decades. The economy will never be brought to a state of health until those problems are more thoughtfully and more directly engaged. This will become more and more clear with each passing month of this hideous recession.
Where Sweatshops Are a Dream
PHNOM PENH, Cambodia
Before Barack Obama and his team act on their talk about “labor standards,” I’d like to offer them a tour of the vast garbage dump here in Phnom Penh.
This is a Dante-like vision of hell. It’s a mountain of festering refuse, a half-hour hike across, emitting clouds of smoke from subterranean fires.
The miasma of toxic stink leaves you gasping, breezes batter you with filth, and even the rats look forlorn. Then the smoke parts and you come across a child ambling barefoot, searching for old plastic cups that recyclers will buy for five cents a pound. Many families actually live in shacks on this smoking garbage.
Mr. Obama and the Democrats who favor labor standards in trade agreements mean well, for they intend to fight back at oppressive sweatshops abroad. But while it shocks Americans to hear it, the central challenge in the poorest countries is not that sweatshops exploit too many people, but that they don’t exploit enough.
Talk to these families in the dump, and a job in a sweatshop is a cherished dream, an escalator out of poverty, the kind of gauzy if probably unrealistic ambition that parents everywhere often have for their children.
“I’d love to get a job in a factory,” said Pim Srey Rath, a 19-year-old woman scavenging for plastic. “At least that work is in the shade. Here is where it’s hot.”
Another woman, Vath Sam Oeun, hopes her 10-year-old boy, scavenging beside her, grows up to get a factory job, partly because she has seen other children run over by garbage trucks. Her boy has never been to a doctor or a dentist, and last bathed when he was 2, so a sweatshop job by comparison would be far more pleasant and less dangerous.
I’m glad that many Americans are repulsed by the idea of importing products made by barely paid, barely legal workers in dangerous factories. Yet sweatshops are only a symptom of poverty, not a cause, and banning them closes off one route out of poverty. At a time of tremendous economic distress and protectionist pressures, there’s a special danger that tighter labor standards will be used as an excuse to curb trade.
When I defend sweatshops, people always ask me: But would you want to work in a sweatshop? No, of course not. But I would want even less to pull a rickshaw. In the hierarchy of jobs in poor countries, sweltering at a sewing machine isn’t the bottom.
My views on sweatshops are shaped by years living in East Asia, watching as living standards soared — including those in my wife’s ancestral village in southern China — because of sweatshop jobs.
Manufacturing is one sector that can provide millions of jobs. Yet sweatshops usually go not to the poorest nations but to better-off countries with more reliable electricity and ports.
I often hear the argument: Labor standards can improve wages and working conditions, without greatly affecting the eventual retail cost of goods. That’s true. But labor standards and “living wages” have a larger impact on production costs that companies are always trying to pare. The result is to push companies to operate more capital-intensive factories in better-off nations like Malaysia, rather than labor-intensive factories in poorer countries like Ghana or Cambodia.
Cambodia has, in fact, pursued an interesting experiment by working with factories to establish decent labor standards and wages. It’s a worthwhile idea, but one result of paying above-market wages is that those in charge of hiring often demand bribes — sometimes a month’s salary — in exchange for a job. In addition, these standards add to production costs, so some factories have closed because of the global economic crisis and the difficulty of competing internationally.
The best way to help people in the poorest countries isn’t to campaign against sweatshops but to promote manufacturing there. One of the best things America could do for Africa would be to strengthen our program to encourage African imports, called AGOA, and nudge Europe to match it.
Among people who work in development, many strongly believe (but few dare say very loudly) that one of the best hopes for the poorest countries would be to build their manufacturing industries. But global campaigns against sweatshops make that less likely.
Look, I know that Americans have a hard time accepting that sweatshops can help people. But take it from 13-year-old Neuo Chanthou, who earns a bit less than $1 a day scavenging in the dump. She’s wearing a “Playboy” shirt and hat that she found amid the filth, and she worries about her sister, who lost part of her hand when a garbage truck ran over her.
“It’s dirty, hot and smelly here,” she said wistfully. “A factory is better.”
Bill Easing Unionizing Is Under Heavy Attack
Workers at the Smithfield plant in Tar Heel, N.C., in 2006. They voted to unionize last month. (Raul Rubiera/Fayetteville Observer, via AP)
WASHINGTON — Intent on blocking organized labor’s top legislative goal, corporations are quietly contributing to lobbying groups with appealing names like the Workforce Fairness Institute and the Coalition for a Democratic Workplace.
These groups are planning a multimillion-dollar campaign in the hope of killing legislation that would give unions the right to win recognition at a workplace once a majority of employees sign cards saying they want a union. Business groups fear the bill will enable unions to quickly add millions of workers and drive up labor costs.
The Coalition for a Democratic Workplace, a federation of 500 business groups, ran a full-page advertisement on Wednesday that sought to discredit the legislation, called the Employee Free Choice Act. The advertisement said that if secret ballots were good enough to elect Barack Obama then they should be good enough for union members, too.
Richard Berman, a Washington lobbyist, has created a business-backed group, the Center for Union Facts, that is planning to run millions of dollars’ worth of television spots over the next few months to pressure moderate Democrats to oppose the bill.
During last fall’s presidential campaign, groups opposing the legislation spent more than $20 million on television commercials in Colorado, Maine, Minnesota and other states in an effort to defeat Democratic Senate candidates who backed the bill.
At a confirmation hearing set for Friday, Republican senators are expected to challenge Representative Hilda L. Solis of California, President-elect Obama’s choice for labor secretary, over her support for the legislation.
Business leaders denounce the bill because it would largely eliminate secret-ballot elections to determine whether workers want a union. (The union win rate has traditionally been far higher through majority signups than elections.)
“If you know anything about politics, it is a game changer,” said Senator John Ensign, Republican of Nevada. “It is a total game changer for the next 40 to 50 years if the Democrats are able to get this legislation that eliminates the right to a secret ballot. We are fighting it hard.”
Senate Democrats have not decided when to bring up the measure. Given its divisiveness, it will not be one of the first bills they bring to the floor. But the legislation has the strong backing of Senator Harry Reid of Nevada, the majority leader, who is expected to bring it up once Democrats are confident they can overcome any filibuster.
In 2007, the House passed a similar bill, but it failed in the Senate on a procedural vote.
Republican leaders and business lobbyists say the Democrats do not have the 60 votes to overcome a filibuster. But union leaders voice optimism, noting that Mr. Obama has endorsed the bill and that Democrats have close to 60 seats in the Senate, though two remain in dispute. Arlen Specter, a Pennsylvania Republican who once was a co-sponsor of the bill, has not decided whether he would support it this time, an aide said.
Whether it is Wal-Mart or the National Restaurant Association, many companies and corporate groups financing the opposition fear that their companies and industries will be among labor’s earliest organizing targets should the bill become law.
Labor leaders say they are setting their sights on several industries, like banks and big-box retailers like Wal-Mart or Target, where unions have had virtually no success.
“We’re going to organize in the basic industries of our unions: construction, hospitality, health care, retail, food production and manufacturing,” said Tom Woodruff, director of strategic organizing for Change to Win, a federation of seven unions that includes the Service Employees International Union, the Teamsters and the United Food and Commercial Workers. “Those are jobs that are going to stay in the country. The question is whether those jobs are going to be decent middle-class jobs.”
Mark McKinnon, a media adviser to the presidential campaigns of John McCain and George W. Bush, is a spokesman for the Workforce Fairness Institute. Mr. McKinnon said the institute was focusing on drumming up grass-roots support from business. He would not say which companies are financing the institute, founded by several longtime Republican operatives.
“This issue has really become very high on the radar screen,” he said. “Businesses are hearing about it, and they are ready to riot in the street about it.”
The measure “is the most radical rewrite of labor legislation since the 1930s,” Mr. McKinnon said. “It is a political nightmare and a public policy disaster.”
Opponents fear that the legislation will enable labor to become a wealthier and more powerful political force. Union leaders see the bill as crucial for reversing labor’s long decline — unions represent just 7.5 percent of private-sector workers, down from nearly 40 percent a half-century ago.
John Engler, president of the National Association of Manufacturers, said that if Wal-Mart’s United States work force of 1.4 million were unionized, that could mean $500 million in additional union dues collected each year — tens of millions of which might be used to support Democratic causes and candidates.
Acknowledging that Wal-Mart presents a formidable challenge, labor leaders say they hope to unionize up to 100 of Wal-Mart’s more than 4,000 United States stores for starters, which might add 30,000 members.
“We are against any bill that would effectively eliminate freedom of choice and the right to a secret ballot election,” said a Wal-Mart spokesman, David Tovar. “We believe every associate” — Wal-Mart’s term for employees — “should have the right to make a private and informed decision regarding union representation.”
Labor leaders say they do not oppose secret-ballot elections, but rather the bitter two-month management-versus-union campaigns that often precede elections. Union leaders say those campaigns are usually unfair because corporations often fire union supporters and press their anti-union views day and night in one-on-one sessions and large meetings while union organizers are prohibited from company property.
Labor leaders said that last month they won one of the biggest unionization victories in years for the nearly 5,000 workers at the Smithfield pork processing plant in Tar Heel, N.C., by insisting on what they said were fairer rules.
If the bill is enacted, unions say they will try to organize workers by quietly getting a majority to sign pro-union cards before companies can begin an anti-union campaign. In theory, a union organizer or pro-union employee would have an easy time signing up a majority of, say, the 25 workers at a McDonald’s, the 15 baristas at a Starbucks or the 50 aides at a nursing home.
Corporations also oppose a provision of the bill that would allow government arbitrators to determine the terms of a contract when no agreement has been reached within 120 days of a union’s winning recognition. Defending that provision, labor leaders say companies often undermine newly formed unions by dragging out contract talks for months, even years.
“The idea of negotiating a contract and turning it over to an arbitrator who has no interest in the company or the workers’ future and then can dictate the terms of a contract, that’s a pretty reckless way to go,” said Mr. Engler of the manufacturers’ association. “This is the one issue that everybody who’s an employer agrees is a bad idea.”
Allison Kilkenny: Unreported 
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