When jobs aren’t enough to overcome low wages, precarious conditions

Valerie Carter, University of Maine

Originally published in the Bangor Daily News on March 1, 2016.

In Maine and elsewhere in the U.S., there is an almost religious belief in jobs as the solution to many problems, such as welfare expenditures, laziness and the rising demands for free meals through soup kitchens.

However, not all jobs are created equal. In today’s economy, finding a job that provides adequate pay, benefits and job security is for many difficult or impossible.

Thousands of people in Maine are working hard, sometimes in multiple jobs, but cannot meet their basic needs. For example, direct care workers for people with disabilities such as autism do indispensable work but receive pathetically low wages.

Having a job is no guarantee that you can pay your rent, see a doctor when you are sick or feed your children. Instead, work for many is insecure, sporadic, poorly paid and with few protections. For workers worldwide, economic conditions are becoming increasingly “precarious,” as described by the British economist Guy Standing in his work on the growing “Precariat” class.

Low wages are a serious challenge facing workers in the U.S. and globally. One study shows that the U.S. has the highest percentage of low-wage workers among OECD (Organisation for Economic Co-operation and Development) countries, about one-quarter of the workforce in 2009. Many low-wage workers in the U.S. also must apply for public assistance in order to get by.

The Economic Policy Institute, or EPI, reports that wages have been stagnating or declining since 1980 for both middle- and lower-income workers, including college-educated workers and those with only a high school degree.

Low wages are also a problem in Maine. The Maine Center for Economic Policy, or MECEP, reports that one-third of the state’s working families are considered to be low income. Department of Labor data show that the majority of the 25 largest projected occupations for 2022 are low-wage jobs, with eight out of the top 12 paying less than $12 per hour.

Low wages and slow economic growth are related to several factors: the decades-long transition from manufacturing to a service economy, a globalized economy in which employers ship jobs and capital to countries with the lowest wages and least regulation, free trade agreements such as NAFTA and the declining rate of unionization in Maine and the U.S. However, it is not simply impersonal forces causing wage stagnation, weak income growth and wealth disparities — these trends, as the Economic Policy Institute puts it, “can be traced to policy decisions that have eroded the bargaining power of low- and middle-wage workers.”

Some other trends contributing to chronic stress and insecurity for U.S. workers are:

More part-time and contingent work, such as temp work and independent contractors;

Fewer benefits, such as employer-provided health care and pensions; and

— Employer-mandated flexible hours and last-minute scheduling, with less control by workers over working time.

Simply put, there is a major shift happening in the structure of employment itself, not only in the U.S. but in many other countries. Globally, workers are assuming the risks of flexible employment, with no guarantees of long-term work, and labor force participation itself is becoming more tenuous.

What strategies might state and federal governments explore to reduce the precarious economic situation of both low-paid workers and those not in the labor force? Job training and further education can be helpful for some individuals. But it does not change the fact that there are many low-paying jobs that provide essential services, and someone needs to do them.

Pursuing “economic growth” through attracting more low-wage, insecure jobs will not work. Instead, we must work to provide a foundation of economic security for all individuals and households, such as restoring full employment, public job creation, stronger labor standards, supports for collective bargaining and raising the minimum wage.

Going further, Guy Standing proposes a “Precariat charter” of rights and policies, and the development of “basic income” strategies as a foundation for personal and social stability, growth and security. Finally, it is urgent that the public and the U.S. Congress reject free trade policies that favor the rights of corporations, such as the proposed Trans-Pacific Partnership agreement awaiting a vote in Congress.

At a time of growing global fears related to instability and threats to our existence, we need to explore policies that support economic security, both for fundamental reasons of justice and to avert serious problems of social cohesion among a chronically anxious and stressed population.

Valerie Carter is a research associate and instructor at the University of Maine’s Bureau of Labor Education. She is a member of the Maine chapter of the Scholars Strategy Network, which brings together scholars across the country to address public challenges and their policy implications. Members’ columns appear every other week.

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