December 18, 2004
Wage report - EPI
As of last month, the economic recovery that officially began in November 2001 was three years old. Yet, as the figure below reveals, hourly earnings (adjusted for inflation) fell 1.3% over the past year and are now at about the same level now as they were when the recovery began.
Real wages grew strongly in the latter 1990s, and the momentum from that period kept wages rising through the recession and jobless recovery. But even though the economy began to add some jobs last year, the rate of growth has been too slow and inconsistent to absorb the slack that remains in the job market. Under such conditions, employers are less compelled to pass along gains in profits or productivity onto workers’ wages. This phenomenon is evident in the deceleration of nominal wages, which grew at an average annual rate of 3.9% in 2000 compared to just 2.1% thus far this year.
December 17, 2004
International Labor and Trade
BBC News reports on the effects on textile workers from the decision by the The World Trade Organisation (WTO) to end its Multi-Fibre Agreement (MFA) at midnight on 31 December.
The MFA was established in the 1970s to give some protection to the textile industries of industrialised countries facing competition from countries with lower manufacturing costs.... Some of the world's fastest developing countries rely on textile exports to build growth - for example in Bangladesh textiles account for almost 85% of the country's exports.
Christian Aid, a charitable organization, condemned the move, saying it would see almost a million jobs in Bangladesh alone being axed.
December 16, 2004
Gely & Caron on Affirmative Refraction
This Article looks at the Supreme Court's recent decision on the use of race in law school admissions through the lens of the famous hypothetical about human cannibalism constructed by Lon Fuller (62 Harv. L. Rev. 616 (1949)). The hypothetical has challenged law students and legal scholars for over half a century, and in recent years scholars have issued dozens of new "opinions" to take into account contemporary legal theories (including symposia in 112 Harv. L. Rev. 1834 (1999) and 61 Geo. Wash. L. Rev. 1731 (1993)). This Article is the first to take the opposite approach and view a real-life legal issue through the eyes of the fictional Justices in The Case of the Speluncean Explorers.
We argue that the various opinions in Grutter find their intellectual forebears in the opinions in The Case of the Speluncean Explorers. For all of the heat and light generated by Grutter, the opinions merely mark another way station in the centuries-old debate among competing jurisprudential philosophies of the role of law and government. By examining the Grutter opinions in the context of this rich jurisprudential tradition, we hope to elevate much of the current debate about the case, in which labels like "liberal" and "conservative" are hurled about like epithets, toward a more sophisticated understanding of how the various approaches of the Justices embody alternative views of the proper judicial function in our democratic system.
The Article introduces a novel jurisprudential approach to judicial decision-making -- what we refer to as a "jurisprudence of humility." Building on the recent work of ideologically diverse scholars, we argue that a jurisprudence of humility recognizes that judges and lawyers hold no monopoly on wisdom and that, in certain situations, institutions other than courts may be better positioned to resolve a particular issue. This jurisprudence of humility construct enables us to draw some rather surprising connections between The Case of the Speluncean Explorers and Grutter and span the gulf in the legal literature between statutory construction and constitutional interpretation.
Report on workplace injuries
A new report from the BLS - WORKPLACE INJURIES AND ILLNESSES IN 2003. Here is the part of the summary:
A total of 4.4 million nonfatal injuries and illnesses were reported in private industry workplaces during 2003, resulting in a rate of 5.0 cases per 100 equivalent full-time workers, according to the Survey of Occupational Injuries and Illnesses by the Bureau of Labor Statistics (BLS), U.S. Department of Labor. The rate of injuries and illnesses declined from 5.3 cases per 100 equivalent full-time workers in 2002. The decline is a result of a 7.1 percent decrease in the number of cases reported and a 0.7 percent decrease in the number of hours worked.
This release is the second in a series of three releases from the BLS covering
occupational safety and health statistics in 2003. The first release, in September 2004, covered work-related fatalities from the 2003 National Census of Fatal Occupational Injuries. In March 2005, a third release will provide details on the more seriously injured and ill workers (occupation, age, gender, race, and length of service) and on the circumstances of their injuries and illnesses (nature of the disabling condition, part of body affected, event or exposure, primary source producing the disability, the time of day of occurrence, and the number of hours into the workshift before the occurrence). "More seriously" is defined in this survey as cases involving days away from work.
December 15, 2004
Article on Child Labor
A new paper from NBER on child labor. In, Why Should We Care About Child Labor? The Education, Labor Market, and Health Consequences of Child Labor by Kathleen Beegle, Rajeev Dehejia, and Roberta Gatti, argue that:
Although there is an extensive literature on the determinants of child labor and many initiatives aimed at combating it, there is limited evidence on the consequences of child labor on socio-economic outcomes such as education, wages, and health. We evaluate the causal effect of child labor participation on these outcomes using panel data from Vietnam and an instrumental variables strategy. Five years subsequent to the child labor experience, we find significant negative impacts on school participation and educational attainment, but also find substantially higher earnings for those (young) adults who worked as children. We find no significant effects on health. Over a longer horizon, we estimate that from age 30 onward the forgone earnings attributable to lost schooling exceed any earnings gain associated with child labor and that the net present discounted value of child labor is positive for discount rates of 11.5 percent or higher. We show that child labor is prevalent among households likely to have higher borrowing costs, that are farther from schools, and whose adult members experienced negative returns to their own education. This evidence suggests that reducing child labor will require facilitating access to credit and will also require households to be forward looking.
Thanks to Joe Hodnicki for the tip.
Report on labor market incentives for older workers
Encouraging work at older ages is a critical policy goal for an aging society, but many features of the current system of benefits and taxes provide strong work disincentives. The implicit tax rate on work increases rapidly at older ages, approaching 50 percent for some workers by age 70. In addition, by age 65 people can typically receive nearly as much in retirement as they can by working. If older Americans could overcome these barriers and delay retirement, they could substantially improve their economic well-being at older ages. For example, many people could increase their annual consumption at older ages by more than 25 percent by simply retiring at age 67 instead of age 62.
December 14, 2004
Union Avoidance and Malpractice Lawsuit
Great article on today's New York Times - How Do You Drive Out a Union? South Carolina Factory Provides a Textbook Case (by Steven Greenhouse).
Greenhouse describes the no so unusual story of employers using strong union avoidance strategies:
This tale began a decade ago when the International Union of Electrical Workers began rounding up support at the factory, which produced giant batteries to power forklifts and provide backup power to cellphone towers.
The union petitioned for a unionization election when many workers voiced dismay about meager pensions, bullying supervisors, production speedups and safety problems, especially with the high temperatures and lead used in production.
The company, then called Yuasa, hired Jackson Lewis to help mount a last-minute anti-union campaign. The company required employees to listen to speakers saying the union did not want to help workers, but only wanted their dues money. Management posted pictures of tombstones and skulls and crossbones in the cafeteria to warn employees that unionized factories often closed.
But on Feb. 23, 1995, the workers voted 191 to 185 to unionize. Management was livid.
"They said that if the union came in the company was doomed," Paulette Jackson, a union steward and quality control worker, said. "They fought tooth and nail. They didn't want a union in the South. Period."
The company fired Ms. Jackson, accusing her of failing to detect some faulty batteries, but her supervisor later told the National Labor Relations Board that the charges were trumped up.
The company's tactics led to many tangles with the labor board, which ultimately filed a sweeping complaint against EnerSys, accusing it of 120 violations of federal law, among them wrongly firing Ms. Jackson and other union leaders, assisting the anti-union campaign, improperly withdrawing union recognition and moving production to nonunion plants as retaliation.
More interesting, however, is the malpractice lawsuit against Jackson Lewis, the law firm representing the employer in its anti-union campaign:
The company has accused the firm, Jackson Lewis, of malpractice and of advising it to engage in illegal behavior. The law firm says that EnerSys ignored its sound advice and that the company is trying to avoid paying its legal bill.
Managing Today's Workforce
Interesting online article about the difficulties of managing today's workforce. In "What were you thinking? The Nintendo generation of workers wants a very different kind of recognition," Gord Green notes:
Our workplace today is a mix of “Baby Boomers” (born around 1945 – 1957), “Post-Boomers” (born around 1957 – 1965), Generation X’ers (born around 1965 – 1978), and Generation Y’s (born around 1978 – 1990). These dates are approximate because they represent more of a mindset than an actual physical age. Of these various sub-groups, they separate into two broader groups, the older generation of “Boomers” and “Post-Boomers”, whom we will simply refer to as “Boomers,” and the younger generation of “Gen Xers” and “Gen Y’s,” whom we will call “Gamers.” Welcome to the ‘Nintendo’ Generation.
Today, corporate management is still predominantly Boomers, and while in many corporations Boomers still make up a slim majority of the workforce, their dominance is quickly subsiding. Gamers are taking over and may account for up to half of the workforce population. This new generation can no longer be considered the “workers of tomorrow;” they’re the “workers of today” and the “leaders of tomorrow.”
Generational conflicts between these two groups are becoming more apparent and have the potential to have a direct impact on the bottom line. It is essential for corporations to have an accurate understanding of the differences between these two groups in order to devise the necessary strategies to maximize their engagement levers and encourage behavioural alignment to the corporate values.
The article goes on to identify what kind of recognition is preferred by each group:
For older generations, their present reality and identity were based on their history. They valued tenure and long-term loyalty because it represented historical investment into the life of the corporation. This “history-building” was the most important attribute worthy of recognition and reward. This older, past generation believed that you got paid for doing your job and doing it well.
Then came the Boomers. “Carpe Diem” — Seize the Day — was their motto. They focus predominantly on personal success and individual achievements. They’re extremely competitive, yet process-oriented. They therefore want recognition & rewards that are based on measurable performance and solid results within a clearly defined set of rules.
The Gamers, however, live at the speed of light. Their present reality certainly isn’t based on history. They live their present reality in the future tense. That’s why the stock market today is all about future value rather than present worth and why the news media publishes more predictions rather than simply reporting about things that have already happened. This is the generation whose motto is not “Seize the Day,” but rather “Seize Tomorrow Today.”
December 13, 2004
Teamsters on the future of labor
According to Steven Greehouse (NYT),
"The Teamsters union heated up the debate over reshaping the labor movement yesterday by proposing to slash the A.F.L.-C.I.O.'s budget and finance a four-year campaign of political and union organizing in swing states to help elect a pro-labor president.
Worried about the steady decline of organized labor, the Teamsters, one of the nation's largest unions, recommended withholding half of the $90 million that individual unions give the labor federation each year and using it to recruit more members. The Teamsters proposal, echoing a 10-point plan issued last month by the Service Employees International Union, would reduce the federation's role and responsibilities as many labor leaders conclude that unions urgently need to focus on recruiting more members."
December 12, 2004
Unions at Wal-Mart? In China, perhaps.
"Wal-Mart has finally found a union it can live with," according to Harold Meyerson, (Washington Post):
Up to now America's largest employer has opposed every effort of its employees to form a union. Wal-Mart doesn't recognize unions; it doesn't even recognize "employees." The proper Wal-Mart name for its workers is "associates," a term that connotes higher status and collegiality and that actually means lower pay and workplace autocracy. For the privilege of associating themselves with Wal-Mart, its employees are paid so little that many can't afford the health insurance the company generously allows them to buy. One study of health care in Las Vegas revealed that a plurality of that city's employed Medicaid recipients worked at Wal-Mart.
But that was the old Wal-Mart. Last week Wal-Mart announced that if its associates wanted a union to represent them, that would be hunky-dory -- as long as the union was affiliated with the All-China Federation of Trade Unions, a body dominated by the Chinese Communist Party. The official statement was simple and seemingly unambiguous: "Should associates request formation of a union, Wal-Mart China would respect their wishes." "
Thanks to Winston Calvert for the tip.