Category Archives: jobs

More on the Minimum Wage

Posted on by
1

Ronald Bailey at Reason had this iteration of “more.” He brought this item up, even though it’s been described before:

In the absence of the higher minimum wage, employers would generally hire more workers to meet an increased demand for fast food. Boosting the minimum wage means that the revenues that would have otherwise been used to hire new workers is not available. The end result: fewer jobs created and more folks unemployed.

But then he cited some actual research:

…published in the December 2014 issue of the Journal of Labor Research, Andrew Hanson of Marquette University and Zack Hawley of Texas Christian University analyzed how low-wage employment would be affected in each state by the imposition of the national $10.10 per hour minimum wage supported by President Obama. The Hanson/Hawley study takes into account how wages relate to the varying cost-of-living levels among the states. First they report the number of workers in a state who earn less than $10.10 per hour. Next they apply the widely agreed upon formula that for every 10% increase in wages there is a corresponding 1 to 2 percent decrease in demand for labor. They then straightforwardly estimate that boosting the federal minimum wage from $7.25 per hour to $10.10 per hour would result in the loss of between 550,000 and 1.5 million jobs.

And this study, by Jeffrey Clemens and Michael Wither of the University of California, San Diego and published by the National Bureau of Economic Research in December, which used different methodology and reached a similar result.

[J]ob losses were considerably higher in states where unskilled workers had been earning less than the new minimum and employers were now forced to pay more. Overall, the authors estimate that the minimum wage increase “reduced the employment-to-population ratio of working age adults by 0.7 percentage points.” Stated otherwise, not raising the minimum wage would have boosted the 2012 employment-to-population ratio from 58.6 to 59.3, which implies that we actually had 1.4 million fewer jobs than we otherwise would have had.

Thus: on the one hand, raising the minimum wage will cost a million people, more or less, their jobs, and on the other hand, an additional 1.4 million jobs weren’t created in the first place.

Beyond that, there’s this. Raising wages raises prices, as even the Left acknowledges. What gets ignored in this is that those higher prices are paid by those who got the pay raise. Those who got the pay raise, also, are those who work low-skill jobs. Those low-skill jobs exist almost exclusively in commodity industries: food service, extraction, and so on. The goods produced in those commodity industries are the ones most susceptible to production costs like labor, yet those costs are most completely reflected in prices despite price competition. These are the goods with whose higher prices those low-skill workers will be confronted. Wage increase leading to price rise equals no net improvement for the low-skilled. That, though, also represents net harm for everyone else in our economy, who also are faced with those same higher prices.

It’s hard to believe those who claim to be so much smarter than us don’t get this. Which makes me wonder about their motive. Against the backdrop of why minimum wage laws were made national laws in the first place, back in the mid-30s.

 

Hanson and Hawley’s paper can be read here, and Clemens and Wither’s paper can be read here (paywall alert).

Liberals and Unions

Posted on by
Reply

In December 2014, the NLRB passed a final rule on a partisan 3-2 vote that greatly shortens the time for a workplace union-organizing election. … Mr. Obama issued a “memorandum of disapproval”—essentially a veto—to kill the Congressional measure [to overturn the rule] and preserve the NLRB rule.

From now on unions will have unlimited time to prepare their campaigns to organize a workplace, springing the election paperwork on an employer when they figure they have the best chance to prevail. By reducing the time before an election to as little as two weeks from the current average of 38 days, unions will be able to lobby workers and make their case before a company can counter with its own argument.

Because with Liberals and unions, there’s only one side to a story. No need to hear from anyone else.

A Reason

Posted on by
Reply

…to decertify public “service” unions. And to terminate for cause the government’s “negotiators” for agreeing to such a thing.

Under the 1978 Civil Service Reform Act, “official time” was named, and it allows public service union members to use company time—that is, time they’re formally working for the government in a government job as a government employee—to do union administrative things. Doing union-specific work on the government’s clock also means they’re being paid by the government—by us taxpayers—to do union, and not government, work.

The thinking behind this little fillip was the premise that the union bargains in the name of all government employees, whether they’re union members or not, and this was a way to compensate the union for those alleged extra costs.

Like all sweetheart deals, this one has gotten out of hand.

According to the Office of Personnel Management, in 2012 (the most recent year there are statistics for) federal workers spent 3.4 million man-hours on union issues and not the work they were hired for. OPM estimates the cost to taxpayers was more than $157 million.

What’s more, at two government agencies that would seem least able to afford a loss of manpower—the Veterans Affairs Department and IRS—hundreds of workers spent 100% of their time doing union work. At the VA, 259 employees worked solely on union issues. At the IRS—which only disclosed their statistics when the National Review sent them a Freedom of Information Act request—the number was 201.

But wait—there’s more:

According to the Bureau of Labor Statistics, 939,000 federal workers belonged to a union in 2014. Another 139,000 were covered by collective bargaining agreements, but weren’t in a union. That brings the total number of employees covered by the unions to 31.6% of the total federal workforce.

However, there’s no requirement for any union to bargain for non-union employees, nor is there any requirement for any employer—even the government—to apply union contract terms to non-union members. Indeed, there’s no requirement for non-union employees to accept union contract terms as their own employment terms.

And so there are no costs for bargaining for the benefit of non-union employees. There never has been, requirement or cost; those are just fictions peddled by self-serving union leadership in order to get more money for union coffers.

Hence my call for decertification and termination.

These Explain a Lot

Posted on by
Reply

Joseph Clancy, Secret Service Director, testified before a House Appropriations subcommittee, and this loose exchange between Clancy and Congressman Chris Stewart (R, UT) ensued:

Clancy: It’s going to take time to change maybe some of this culture. There’s no excuse for this information not to come up the chain. That’s going to take time because I’m going to have to build trust with our workforce. And the best way for me to work or earn that trust with our workforce is by my actions.

Stewart: I understand what you’re trying to do. I really do. But when you say, I have to set an example, I have to earn their trust. Dude, you don’t have to earn their trust. You’re their boss. They’re supposed to earn your trust.

And this:

The Secret Service director said he didn’t learn about the March 4 incident until five days later from an anonymous email, a delay he described as unacceptable. He said he delivered a “good, stern talk” to his staff upon learning he was kept in the dark.

“Good, stern talk?” Why is the head of that staff still on Clancy’s payroll?

Hmm….

Of Course He Will

Posted on by
Reply

The National Labor Relations Board, the union arm of the Wagner Act, enacted a rule a few weeks ago that allows unions to hold organizing votes in non-union companies before company management has a chance to respond.

The Senate passed a resolution canceling the NLRB’s rule with a party line oriented vote. The House is taking up the bill and is expected to pass it as well, and with a party line oriented vote.

President Barack Obama, who succeeded in packing the NLRB for this sort of purpose, is expected to veto the resolution.

Of course he will. Remember this veto in 2016.