tag:theconversation.com,2011:/africa/topics/low-wages-37393/articlesLow wages – The Conversation2023-04-13T13:09:39Ztag:theconversation.com,2011:article/2031222023-04-13T13:09:39Z2023-04-13T13:09:39ZFast Fashion: Why garment workers’ lives are still in danger 10 years after Rana Plaza — Podcast<figure><img src="https://images.theconversation.com/files/519920/original/file-20230407-22-j62yrw.png?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">That cheap statement piece comes at a price: the industry has a 'murderous disregard for human life.'</span> <span class="attribution"><span class="source">(Clockwise: AP/Mahmud Hossain; AP/Ismail Ferdous; Unsplash/Markus Spiske; Unsplash/Clem Onojeghuo)</span></span></figcaption></figure><iframe height="200px" width="100%" frameborder="no" scrolling="no" seamless="" src="https://player.simplecast.com/ad814240-69ec-47f4-b6b5-05e21ad97582?dark=true"></iframe>
<p>Fast fashion is that ever-changing need to have the latest beautiful thing at a bargain price — that club-ready piece of clothing, that status symbol shoe or that must-have top you just found at the mall. </p>
<p>But that cheap statement piece comes at a price. <a href="https://news.un.org/en/story/2019/03/1035161">The fashion industry is the second most polluting industry in the world, after the oil and gas sector.</a> It’s also famously unfair to its workers, the majority of whom are women. Although there has been a lot of talk about female empowerment, the reality is that most women who toil on the factory floor remain in poverty for most of their lives. </p>
<p>Ten years ago this month, much attention turned to the global garment industry when a group of garment factories collapsed at Rana Plaza near Dhaka, Bangladesh. The accident, called a <a href="https://www.theguardian.com/global-development/2018/apr/24/bangladeshi-police-target-garment-workers-union-rana-plaza-five-years-on">“mass industrial homicide”</a> by unions in Bangladesh, killed 1,124 people and injured at least 2,500 more. </p>
<p>Most of the people who went to work that day were young women, almost all were supporting families with their wages and all were at the bottom of the global production chain.</p>
<p><a href="https://dont-call-me-resilient.simplecast.com/episodes/fast-fashion-why-garment-workers-lives-are-still-in-danger-10-years-after-rana-plaza">This week on <em>Don’t Call Me Resilient</em></a>, we look back at the Rana Plaza disaster to explore how much — or how little — has changed for garment worker conditions since.</p>
<p>The industry has a “<a href="https://www.brown.edu/academics/race-ethnicity/events/fast-fashion-and-racial-capitalism-power-and-vulnerability-global-supply-chains-gender-and">murderous disregard for human life.</a>” That’s how this episode’s guest, Minh-Ha Pham, puts it. She is an associate professor in media studies at the Pratt Institute in Brooklyn and the author of <a href="https://www.dukeupress.edu/why-we-cant-have-nice-things"><em>Why We Can’t Have Nice Things.</em></a></p>
<p>Also joining us is Dina Siddiqi, a feminist anthropologist and an expert on labour in Bangladeshi garment factories. She is an associate professor at New York University.</p>
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<img alt="" src="https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/520620/original/file-20230412-26-awoga.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Social media campaigns like ‘I made your clothes’ can help to raise awareness but don’t necessarily address structural issues.</span>
<span class="attribution"><span class="source">(Fashion Revolution)</span></span>
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<h2>‘Murderous disregard for life’</h2>
<p>The collapsed buildings at Rana Plaza had shown signs of cracks the day before. While other tenants in the buildings — the banks and shops — sent their workers home, the garment factories’ managers insisted their people come to work to meet the relentless deadlines of clothing manufacturing. </p>
<p>Ten years ago, but also today, Siddiqi says garment workers are left with impossible choices: </p>
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<p>“They did not feel they had the right to say no because they were threatened with dismissal. They were owed wages already. Those are everyday conditions in the garment industry…their choice was: risk dismissal and possible starvation…or risk their lives.”</p>
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<p>Approximately five million people in Bangladesh work to produce clothing for hundreds of major international brands, <a href="https://www.aljazeera.com/news/2023/1/11/fashion-brands-paid-less-than-production-cost-to-bangladesh-firms">including Zara, H&M and GAP</a>. It is the second largest global producer of clothing and has the lowest wages. </p>
<p>Garment factories also exist in the Global North. Last week the United States Department of Labor released a report on garment workers in Los Angeles that said <a href="https://www.latimes.com/california/story/2023-04-04/garment-industry-los-angeles-low-wages-violations-us-department-of-labor-report">some were getting paid as little as $1.58 an hour</a>. </p>
<h2>Corporate solutions fall short</h2>
<p>While many corporations have now signed the <a href="https://www.nytimes.com/2021/08/25/business/garment-worker-safety-accord.html">Bangladesh Accord</a> in an attempt to make things safer, Minh-Ha Pham says the accord has a narrow definition of worker safety. The focus is on structural integrity of buildings and corporate liability. But Pham says: </p>
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<p>“If you talk to workers, safety means having a workplace free of physical, sexual verbal assault. Safety is getting paid on time. Not having the freedom of association, not having child care, not having maternity leave…create unsafe conditions of labour. [These are things that] initiatives like the Bangladesh accord don’t even begin to imagine.”</p>
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<p>The focus on corporate-led solutions, such as the accord, allows clothing brands to appear socially responsible in spite of the reality on the ground. Pham says that without oversight and regulation, these types of initiatives “make brands that are signing on to these initiatives…look good. Consumers feel good about these brands. But there’s no follow through.”</p>
<h2>Western saviour complex</h2>
<p><a href="https://www.researchgate.net/publication/352893724_The_fashion_scandal_Social_media_identity_and_the_globalization_of_fashion_in_the_twenty-first_century">Social media campaigns</a> to hold brands accountable to their workers have proliferated in the last decade. </p>
<p>However well intended, Pham says these campaigns — primarily led by those in the Global North — don’t address the structural and systemic nature of exploitation inherent to the global garment industry. </p>
<p>She says the campaigns can actually take the attention away from the structural problems. “They make us feel like if we could just tweak this thing, then everything else will be okay. It actually legitimizes the system because (it says) the system is basically okay, but for A, B, and C things that we can fix.” </p>
<p>And Siddiqi says in the last 10 years, brands have actually paid Bangladeshi garment workers increasingly lower prices to make the exact same product. “So brands are squeezing Bangladesh at the same time that they’re telling Bangladesh factory owners that they must be better to their workers.”</p>
<p>Both Siddiqi and Pham also caution against the idea that this is solely a Bangladeshi problem. They say racist assumptions see the Global South as inherently corrupt and “backwards.” But these notions overshadow the <a href="https://www.latimes.com/california/story/2023-04-04/garment-industry-los-angeles-low-wages-violations-us-department-of-labor-report">exploitation of and resistance by</a> racialized and gendered workers in the West, in places like Los Angeles. </p>
<p>Pham says “it’s easy to think of, you know, oh gosh, those people over there…They don’t care about humanity. They don’t care about safety. [But] this happened in California.” </p>
<p>For example, in 2020, Pham says, garment workers were being “held up as heroes because factories shifted to making masks for a while when we were wearing cloth masks. But (workers) oftentimes (were) coming in without health insurance, without safety protocols, oftentimes without masks risking COVID, (working) in California, for piece rate wages.” </p>
<h2>Now what?</h2>
<p>Both scholars say those who want to help to alleviate pervasive exploitation in the global garment factory industry must make efforts to understand an intentionally opaque supply chain system. This includes learning about brand contracts, international trade and labour laws and immigration and border policies. It also involves the necessary but difficult task of explicitly naming capitalism as a structural problem. </p>
<p>Ultimately, Pham and Siddiqi say western advocates must support collective actions initiated by the workers themselves.</p>
<h2>From The Conversation</h2>
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Read more:
<a href="https://theconversation.com/fashion-production-is-modern-slavery-5-things-you-can-do-to-help-now-115889">Fashion production is modern slavery: 5 things you can do to help now</a>
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Read more:
<a href="https://theconversation.com/heres-what-businesses-and-consumers-can-do-to-tackle-modern-slavery-in-supply-chains-200694">Here's what businesses and consumers can do to tackle modern slavery in supply chains</a>
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Read more:
<a href="https://theconversation.com/why-the-fashion-industry-keeps-failing-to-fix-labour-exploitation-87356">Why the fashion industry keeps failing to fix labour exploitation</a>
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Read more:
<a href="https://theconversation.com/victorias-secret-does-it-again-cultural-appropriation-87987">Victoria's Secret does it again: Cultural appropriation</a>
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<h2>Read more</h2>
<p><a href="https://doi.org/10.1017/S0147547915000101">“Starving for Justice”</a> by Dina Siddiqi</p>
<p><a href="https://newrepublic.com/article/153596/fix-fashion-industrys-racism">“How to Fix the Fashion Industry’s Racism”</a> by Minh-Ha Pham</p>
<p><a href="http://www.taslimaakhter.com/garment_workers_life_struggle/">Taslima Akhter: Documentary photographer and activist </a></p>
<p><a href="https://truthout.org/articles/turn-up-the-heat-on-fairness-american-garment-workers-deserve-better/">“Turn Up the Heat on Fairness: American Garment Workers Deserve Better”</a></p>
<p><a href="https://remake.world/stories/news/colonialism-in-fashion-brands-are-todays-colonial-masters/">“Brands are Today’s Colonial Masters”</a></p>
<h2>Listen and Follow</h2>
<p>You can listen to or follow <em>Don’t Call Me Resilient</em> on <a href="https://podcasts.apple.com/ca/podcast/dont-call-me-resilient/id1549798876">Apple Podcasts</a>, <a href="https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5zaW1wbGVjYXN0LmNvbS9qZFg0Ql9DOA">Google Podcasts</a>, <a href="https://open.spotify.com/show/37tK4zmjWvq2Sh6jLIpzp7">Spotify</a> or <a href="https://dont-call-me-resilient.simplecast.com">wherever you listen to your favourite podcasts</a>. <a href="mailto:DCMR@theconversation.com">We’d love to hear from you</a>, including any ideas for future episodes. Join The Conversation on <a href="https://twitter.com/ConversationCA">Twitter</a>, <a href="https://www.facebook.com/TheConversationCanada">Facebook</a>, <a href="https://www.instagram.com/theconversationdotcom/">Instagram</a> and <a href="https://www.tiktok.com/@theconversation">TikTok</a> and use #DontCallMeResilient.</p><img src="https://counter.theconversation.com/content/203122/count.gif" alt="The Conversation" width="1" height="1" />
We look back to the 2013 Rana Plaza garment factory collapse in Bangladesh that killed 1,124 people and discuss how much — or how little — has changed for garment-worker conditions today.Vinita Srivastava, Host + Producer, Don't Call Me ResilientBoké Saisi, Associate Producer, Don't Call Me ResilientLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1899532022-09-05T01:09:37Z2022-09-05T01:09:37ZBarbara Ehrenreich never stopped trying to change the world<figure><img src="https://images.theconversation.com/files/482617/original/file-20220904-23289-3j3jpe.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C3175%2C2146&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Andrew Shurtleff/AP</span></span></figcaption></figure><p>We’ve just lost one of the world’s finest writers about inequality and class – and the business of being alive in the United States today. Barbara Ehrenreich, best known for <a href="https://www.nytimes.com/2022/09/02/books/barbara-ehrenreich-dead.html">her</a> “classic of social justice literature”, <a href="https://www.allenandunwin.com/browse/book/Barbara-Ehrenreich,-introduction-by-Polly-Toynbee-Nickel-and-Dimed-9781783787548">Nickel and Dimed</a>, died on Thursday, aged 81.</p>
<p>Ehrenreich grew up in a working-class, “<a href="http://www.booknotes.org/Watch/9435-1/Barbara-Ehrenreich">strong union</a>” family, with blue-collar roots. (Her father was a copper miner, who <a href="https://www.nytimes.com/2022/09/02/books/barbara-ehrenreich-dead.html">later</a> earned a PhD and became an executive; her mother was a homemaker.) </p>
<p>She wrote more than 20 books about the human condition and subjected experience – frequently her own – to forensic examination. She probed the familiar to make it strange, and linked what she found to a politics that aimed to make things better.</p>
<p>Ehrenreich <a href="http://www.booknotes.org/Watch/9435-1/Barbara-Ehrenreich">once said</a> “seeing real prejudice for blue-collar, working-class people” from her place within the professional middle class had a strong impact on her.</p>
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Read more:
<a href="https://theconversation.com/no-through-road-path-to-prosperity-eludes-americas-jobless-poor-8329">No through road: path to prosperity eludes America's jobless poor </a>
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<h2>Storytelling linked to political change</h2>
<p>The political effect of timely, powerful storytelling linked to political change is important – as was shown last week, during Australia’s <a href="https://theconversation.com/view-from-the-hill-summit-triggers-immediate-action-and-elevates-gender-equality-189883">Jobs and Skills Summit</a>. </p>
<p>An array of voices from Australia’s corporate, union and civil leadership dominated the summit. But the room was quietest around midday on day two, when household names were in short supply. </p>
<p>Five very personal contributions on discrimination and community attitudes silenced the large room. Not because the speakers were famous; they were not. And not because they presented killer data or had made a fortune. They had not.</p>
<p>Instead, they each told a portion of their own stories about making their way through thickets of discrimination and marginalisation, describing the challenges they faced, and the people and experiences that changed their course. </p>
<p>Chances are, these are the stories the summit’s participants will remember best. Stories of confronting inequality and finding kindness, opportunity and courage – and their opposites – at moments that changed their lives.</p>
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<a href="https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/482623/original/file-20220904-39897-q0jhzr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">The political effect of timely storytelling was on display at Australia’s Jobs and Skills Summit.</span>
<span class="attribution"><span class="source">Mick Tsikas/AAP</span></span>
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<h2>Witnessing class and power</h2>
<p>As Ehrenreich’s body of work shows us, witnessing human experience through the lens of class and power is a potent teacher. </p>
<p>The lessons it delivers are more robust than buckets of data, or the best Powerpoint presentation. It can illuminate precisely what is going on in a society – and what might make a difference. It can cut through wilful ignorance, as well as the self-protective, rationalising layers of the helping, professional and political classes (who manage poverty and class divides). </p>
<p>This was a fact well known to Ehrenreich, who studied class and knew the power of story – and especially experience. Across her many books, articles and speeches, she told stories about health care, women’s lives, war, collective joy, poverty and the failures of individualism. </p>
<p>She analysed the world of care, globalisation, social reproduction and work. She shone a steady and powerful light on the detail of life and society. </p>
<p>Early on, she cut her teeth analysing the masculine medical management of birth and women’s health – specifically, <a href="https://en.wikipedia.org/wiki/Barbara_Ehrenreich">her own first birth</a> in a public hospital among low-income Americans. (Where her labour was induced because it was late in the evening and the doctor wanted to go home.) Later, <a href="https://www.newyorker.com/culture/the-new-yorker-interview/barbara-ehrenreich-is-not-an-optimist-but-she-has-hope-for-the-future">she said</a> it made her a feminist.</p>
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Read more:
<a href="https://theconversation.com/mental-wealth-and-jobs-without-it-were-just-pouring-water-into-a-leaking-bucket-189539">Mental wealth and jobs: without it, we're just pouring water into a leaking bucket</a>
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<h2>Exposing poverty, inequity, hypocrisy</h2>
<p>Erhenreich’s most famous book, a bestseller, was <a href="https://www.allenandunwin.com/browse/book/Barbara-Ehrenreich,-introduction-by-Polly-Toynbee-Nickel-and-Dimed-9781783787548">Nickel and Dimed: On (not) Getting by in Low-wage America</a> (2001), which chronicled her own extended experiment working in a range of low-paid jobs as a waitress, housekeeper and retail worker. </p>
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<a href="https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=927&fit=crop&dpr=1 600w, https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=927&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=927&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1165&fit=crop&dpr=1 754w, https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1165&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/482622/original/file-20220904-39923-piw3a.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1165&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<p>She set out the daily pain and onerous management that living on minimum wage and in working poverty represents: its juggle of rent, food, health and transport – and the extraordinary servility, control and indignity it imposes. And she wrote it in a way that put her own struggles on the page, creating a compulsive read. She was the Lee Childs of sociological literature. </p>
<p>Her account contributed to a push to lift minimum wages in the US. It led to thousands more contributions she made to understanding working poverty and 21st-century working and middle-class life. </p>
<p>It inspired spinoffs by journalists replicating Ehrenreich’s experiment, including the United Kingdom’s Polly Toynbee (<a href="https://www.goodreads.com/en/book/show/991577.Hard_Work">Hard Work: Life in Low Pay Britain</a>, 2003) and Australia’s Elizabeth Wynahusen (<a href="https://www.goodreads.com/book/show/617585.Dirt_Cheap">Dirt Cheap: Life at the Wrong End of the Job Market</a>, 2003). </p>
<p>And – in some part – it led to Helen Masterman-Smith’s and my own account of the lived experience of poverty, <a href="https://www.goodreads.com/book/show/7170199-living-low-paid">Living Low Paid: The Dark Side of Prosperous Australia</a> (2008), which featured low-paid workers sharing their experiences in their own words. </p>
<p>Erhenreich’s writing about the 2009 recession led her to create the <a href="https://economichardship.org/">Economic Hardship Reporting Project</a>, which collects and publishes own-voices accounts of poverty in the US. It’s a project that’s all too relevant to one of the most unequal societies on our planet. </p>
<p>Ehrenreich has also chronicled the collapse of middle American white- and pink-collar jobs in nursing, teaching and other professions, with their deterioration into boundless demands, long hours and low pay. </p>
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<p>She excoriated the wellness movement in her 2018 book <a href="https://www.allenandunwin.com/browse/book/Barbara-Ehrenreich-Natural-Causes-9781783782420">Natural Causes</a>, which picked apart the ways we are encouraged to love our diseases and take personal responsibility for their outcomes, pretending we are master of our bodily universes – while at the same time living in a society where millions confronted the pandemic without a shred of paid sick leave and where the health system is the poster child for punitive, murderous inequality. </p>
<p>In <a href="https://www.allenandunwin.com/browse/book/Barbara-Ehrenreich-Smile-Or-Die-9781783787531">Smile or Die</a>, Ehrenreich expertly challenged America’s passion for <a href="https://theconversation.com/donald-trump-boris-johnson-and-the-dangers-of-excessive-positivity-146356">positive thinking</a>, which elevates individual will over collective responsibility. She <a href="https://www.newyorker.com/culture/the-new-yorker-interview/barbara-ehrenreich-is-not-an-optimist-but-she-has-hope-for-the-future">argued</a> it was a reason for the 2008 economic collapse. “Nobody could see that anything bad was coming.”</p>
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<figcaption><span class="caption">Barbara Ehrenreich talks about toxic positivity, and her book Smile or Die.</span></figcaption>
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<h2>She entered the fray</h2>
<p>Ehrenreich did not choose easy stories. At the time of her death, she was working on a book <a href="https://www.newyorker.com/culture/the-new-yorker-interview/barbara-ehrenreich-is-not-an-optimist-but-she-has-hope-for-the-future">about narcissism</a>. And she did not take refuge in the quiet of the printed page; she engaged in the disaster zone that has been US politics for much of her life. Ehrenreich was actively involved with a range of organisations (as founder, adviser or board member), from the <a href="https://www.prochoiceamerica.org/">National Abortion Rights Action League</a> to the <a href="https://progressive.org/topics/progressive-media-project/">Progressive Media Project</a>. She regularly entered the fray, while making her analytical contributions at the same time. </p>
<p>“Jobs that don’t pay enough to live on do not cure poverty,” she once <a href="https://www.democracynow.org/2011/8/8/nickel_dimed_on_not_getting_by">said</a>. “They condemn you, in fact, to a life of low-wage labor and extreme insecurity.”</p>
<p>Barbara would have been an impatient presence at last week’s Jobs and Skills Summit, on the lookout for the class and gender story beneath the data, for the fault lines of inequality and their causes. She would have been alert to the hypocrisy of talk in place of action, and – most importantly – to the possibility of change, and pathways to it. </p>
<p>Most probably, however, she would have been found at the front of Parliament House, outside it, with the small crowd of illegally assembled unemployed who were refused a permit to assemble, and banished from attending the summit. </p>
<p>She might have listened to their stories – told to a single SBS camera – about what drove them to be on <a href="https://theconversation.com/albanese-has-dropped-labors-pledge-to-boost-jobseeker-with-unemployment-low-is-that-actually-fair-enough-181256">Jobseeker</a> (caring responsibilities, health issues, discrimination at work) and the consequences of being on it (empty fridges, missed medical treatment, transport difficulties). </p>
<p>As she put it in a <a href="https://www.newyorker.com/culture/the-new-yorker-interview/barbara-ehrenreich-is-not-an-optimist-but-she-has-hope-for-the-future">late interview</a> with the New Yorker: </p>
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<p>The idea is not that we will win in our own lifetimes, and that’s the measure of us, but that we will die trying.</p>
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<p>May the world continue to see and publish formidable women like Barbara Ehrenreich. Women who put their eloquence, creativity, courage and minds to work – to illuminate, inform and change our world.</p>
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Read more:
<a href="https://theconversation.com/donald-trump-boris-johnson-and-the-dangers-of-excessive-positivity-146356">Donald Trump, Boris Johnson and the dangers of excessive positivity</a>
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<p class="fine-print"><em><span>Barbara Pocock is a Greens Senator for South Australia. She has previously received Australian Research Centre Grants funding her research on work and employment, including low pay.</span></em></p>‘Formidable’ writer and inequality activist Barbara Ehrenreich – author of Nickel and Dimed – has died, aged 81. Barbara Pocock celebrates her legacy.Barbara Pocock, Emeritus Professor University of South Australia, University of South AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1692852021-10-21T13:38:35Z2021-10-21T13:38:35ZHow Zambian trade unions’ good intentions hurt workers<figure><img src="https://images.theconversation.com/files/427192/original/file-20211019-14-18s5aqb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Zambia's mining industry is highly unionised but the unions are too weak to protect workers' interests.</span> <span class="attribution"><span class="source">Getty Images</span></span></figcaption></figure><p>In Zambia’s mining industry, wages and working conditions have consistently declined for <a href="https://www.tandfonline.com/doi/abs/10.1080/03056244.2017.1345731">30 years</a>. This is primarily because of <a href="https://books.google.com.au/books?hl=fr&lr=&id=_143DwAAQBAJ&oi=fnd&pg=PA39&dq=lee+precarity+in+Zambia&ots=oVU47F822L&sig=tfyaoC5jNAUAW0hL-yNtllvNXNA&redir_esc=y#v=onepage&q=lee%20precarity%20in%20Zambia&f=false">changes to labour laws</a>. Strikes have been banned, the subcontracting of workers has become easier, and wages are negotiated at each workplace, rather than for the industry as a whole. </p>
<p>Though the industry, which mines mainly copper and accounts for <a href="https://eiti.org/zambia#:%7E:text=According%20to%20the%20latest%20EITI%20reporting%20(2019)%2C%20the%20extractive,total%20employed%20persons%20in%20Zambia.">9.95% of GDP</a>, is heavily unionised, unions have been unable to protect workers. Zambian miners are <a href="http://www.daily-mail.co.zm/coward-union-leaders-let-downs/">disillusioned</a> with their unions. Their disappointment is made worse by the tendency of unions to portray themselves as strong. The mismatch of image and reality leads workers to see union leaders as corrupt or cowardly, rather than as disempowered by national laws and international capital. </p>
<p>My <a href="https://rai.onlinelibrary.wiley.com/doi/10.1111/1467-9655.13420">research</a> suggests instead that Zambian unions are close to management because they are trying to help workers. However, through their attempts to assist miners with their daily needs, unions enabled lower wages and worse working conditions.</p>
<h2>The research</h2>
<p>I <a href="https://www.tandfonline.com/doi/full/10.1080/01436597.2021.1908827">studied</a> Zambian mining unions between 2016 and 2019, to understand why they could not protect workers’ wages and what they did instead. </p>
<p>I examined the organisational practices of three of the country’s largest unions - the Mineworkers Union of Zambia, the United Mineworkers Union of Zambia and the National Union of Mine and Allied Workers. In more than 120 interviews, I also explored the daily lives of union members employed on mines, volunteer unionists and leaders. </p>
<p>The 12 months of participant observation culminated in two research reports. The first was published in <a href="https://www.tandfonline.com/doi/full/10.1080/01436597.2021.1908827">April 2021</a>, the second in <a href="https://rai.onlinelibrary.wiley.com/doi/10.1111/1467-9655.13420">June 2021</a>.</p>
<p>Other studies often examine union tactics and workers’ daily lives without connecting the two. I see the daily lives of workplace-based volunteer union leaders (called branch executives) and the tactics of senior union leaders as entwined. </p>
<p>Based on both pieces of research, I argue that, by taking on moral responsibility for workers’ lives, unions subsidised an unjust employment system. This argument has two parts. <a href="https://rai.onlinelibrary.wiley.com/doi/10.1111/1467-9655.13420">Branch executives justified the low wages that miners received</a>. And, <a href="https://www.tandfonline.com/doi/full/10.1080/01436597.2021.1908827">through framing themselves as entrepreneurs, selling goods and services on credit</a>, unions made it possible for their members to live on lower incomes. This subsidised employers, by enabling them to pay less than a living wage. </p>
<p>Unions made it possible for workers to survive even though actual wages were not enough to live on. This meant wage exploitation and poor working conditions could continue.</p>
<h2>Justifying low wages</h2>
<p>Zambia’s mining unions claimed to be powerful and militant. They motivated workers through chants like “The People United Will Never Be Defeated”. Union leaders argued that they negotiated the highest salaries by understanding economic data and by threatening strikes. But instead they worked closely with employers. </p>
<p>They also opened stores that sold food on credit and offered loans to miners. Union branch executives came to understand themselves as savvy technocrats. They invested heavily in learning the economic data and industry trends that they believed would shape wages.</p>
<p>Union leaders and members saw their union as a financially influential entrepreneurial entity, because of the businesses it ran. They understood these debt-centric businesses as a sign of unions’ strength, rather than workers’ poverty. </p>
<p>Miners and unionists came to see their wages and working conditions as determined by a just “free market”, instead of by a legal system that favoured employers and foreign investors. Seeing things this way also encouraged unions to provide goods and services that subsidised wages below the cost of living.</p>
<p>Union branch executives were typically popular miners who held leadership positions in their church and community. They assisted their coworkers daily, by resolving disputes with management and providing material support to struggling peers. They were also nominally in charge of negotiating wages.</p>
<p>Despite the union leaders’ popularity, miners often accused them of receiving bribes to accept low wages in salary negotiations, and to discourage strikes. </p>
<p>In contrast, I <a href="https://rai.onlinelibrary.wiley.com/doi/10.1111/1467-9655.13420">found</a> that the mentally and emotionally demanding process of negotiating wages forced union branch executives to draw strength from depicting themselves as technocrats. For example, when negotiating wages, they compiled shopping lists showing increased living costs. </p>
<p>This encouraged the union branch executives to believe that negotiations had been fair and had produced the highest wages the market allowed. This, even when legal structures made negotiations unlikely to result in higher wages. </p>
<p>Because union branch executives also offered their increasingly poor coworkers gifts and loans, miners were able to live off ever-decreasing salaries. They were thus more likely to listen to the branch executives when they discouraged strikes that had on occasion raised wages.</p>
<h2>Union entrepreneurship</h2>
<p>To fund the material support offered by union branch executives to miners, Zambian mining union head offices operate small businesses. These target members as customers and charge above-market prices. Despite this, they are popular because they offer long (albeit expensive) lines of credit. </p>
<p>Both in Zambia and elsewhere this is seen as a cynical form of business unionism. It entails unions profiting from workers rather than assisting them in their conflicts with management. I <a href="https://www.tandfonline.com/doi/full/10.1080/01436597.2021.1908827">found</a> that Zambian mining unions increasingly conceptualised themselves as entrepreneurs. The profits from the small businesses they operated paid for the costs of unionising workers, whose salaries were decreasing. </p>
<p>These unions-as-businesses also helped small businesses run by other miners and unemployed Zambians. Rather than seeing this as caused by the unions’ inability to obtain wages that covered living costs, the union leaders and local semi-employed miners conceptualised themselves as powerful entrepreneurs, within a “fair” free market. </p>
<p>Unions and workers assisted their unemployed and casually employed peers by offering them loans or buying their overpriced goods and services. </p>
<h2>Ways forward for Zambian unions</h2>
<p>My work calls for understanding Zambian unions’ closeness to management as caused by unionists’ attempts to improve the lives of workers, rather than by corruption or cowardice. This closeness occurs in the context of a global capitalism that they have either been taught to perceive as just or to accept as inevitable. </p>
<p>A core challenge going forward for the unions is maintaining membership numbers without promising victories that are unlikely to occur. Unions may need to continue using entrepreneurship and wage negotiating skills to assist members. But, they must also highlight that union businesses and negotiations occur within an unjust national and international labour system.</p><img src="https://counter.theconversation.com/content/169285/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>This article was written as part of the WORKinMINING project (<a href="https://www.workinmining.ulg.ac.be">https://www.workinmining.ulg.ac.be</a>). The project has received funding from the European Research Council (ERC) under the European Union’s Horizon 2020 research and innovation programme (grant agreement no. 646802). The ideas developed in this article reflect only the author’s view. The ERC is not responsible for any use that may be made of the information it contains. </span></em></p>Through their attempts to assist miners with their daily needs, Zambian unions enable lower wages and worse working conditions.Thomas McNamara, Lecturer, La Trobe University, La Trobe UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1621622021-06-21T01:00:02Z2021-06-21T01:00:02ZAre low-paid jobs really a stepping stone to better pay? A new study suggests it’s not that simple<figure><img src="https://images.theconversation.com/files/406898/original/file-20210617-25-sz0udd.jpg?ixlib=rb-1.1.0&rect=0%2C8%2C6000%2C3979&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>A job – any job – is generally thought of as better than no job at all. Consequently, low-paid work is often considered a “stepping stone” to a higher-paid job. But how easily do low-paid workers climb up the pay scale, really?</p>
<p>Our <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/1475-4932.12609">new research</a> suggests past studies may have considerably overstated the chances of moving from low to higher pay. This has significant implications for understanding labour market behaviour.</p>
<p>Given the NZ$3.3 billion <a href="https://www.workandincome.govt.nz/about-work-and-income/news/2021/2021-budget.html">increase in welfare payments</a> announced in New Zealand’s recent budget – dubbed the “biggest lift in a generation” – and the ongoing focus on inequality and minimum wage rates, how we measure income mobility is increasingly important.</p>
<p>In particular, what are some of the characteristics of the low-paid workforce? How likely or unlikely is it that an individual can transition from low to higher pay?</p>
<p>Past research has described low-paid work as a stepping stone if there is a greater chance of moving to higher pay relative to someone who is unemployed. </p>
<p>Furthermore, the data have suggested relatively high likelihoods of making the transition from low to higher pay — estimates range from 47% to nearly 90%, based on studies from the UK, Australia and Germany.</p>
<p>However, this research has mostly had to rely on survey data based on individual responses to an annual set of questions. This means we can only observe a snapshot of any given labour market once a year.</p>
<p>When determining whether an individual is unemployed, low paid or higher paid, a lot of information between those annual surveys falls into the unknown.</p>
<h2>What traditional research misses</h2>
<p>Why does this matter? It helps to imagine three different individuals, with different labour market experiences, answering a survey about their employment status in October 2019 and again in October 2020:</p>
<ul>
<li><p>one was low paid in the first survey and remained in low pay every month until the second survey</p></li>
<li><p>the second oscillated between low and higher pay between surveys but happened to be in low pay at each survey point</p></li>
<li><p>the third regularly moves between low pay and unemployment but is also in low pay at the time of each survey.</p></li>
</ul>
<p>Because of the lack of information between survey time points, all three individuals will fall into the same category. In turn, this may influence estimates of movement out of low pay.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/nz-budget-2021-women-left-behind-despite-the-focus-on-well-being-161187">NZ Budget 2021: women left behind despite the focus on well-being</a>
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<h2>What more detail reveals</h2>
<p>In New Zealand we have the advantage of the integrated data infrastructure (<a href="https://www.stats.govt.nz/integrated-data/integrated-data-infrastructure/">IDI</a>), a large research database published by <a href="https://www.stats.govt.nz/">Stats NZ</a>. </p>
<p>As well as being population-wide, this provides monthly administrative tax records that reveal labour market states at a much higher frequency.</p>
<p>Our research uses these detailed data to look at the male low-paid workforce aged between 21 and 60 in New Zealand. The results are illuminating.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/nzs-second-well-being-budget-must-deliver-for-the-families-that-sacrificed-most-during-the-pandemic-160528">NZ's second 'Well-being Budget' must deliver for the families that sacrificed most during the pandemic</a>
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<p>First, we mimicked conventional earlier research by looking at the labour market from only one month each year. Through this lens, New Zealand looks similar to Australia, with the probability of moving from low pay to higher pay estimated to be 74%.</p>
<p>When we use the detailed monthly income records, however, it is clear the picture is not as rosy. Most importantly, the likelihood of moving from low pay to higher pay is much lower than traditional methods suggest.</p>
<p>In fact, for those who have been in low-paid work for all of the prior 12 months, we found the likelihood of them moving into higher pay in the following month was only 28%. Being continuously in low-paid work, it seems, means it isn’t easy to climb out.</p>
<h2>A limited stepping stone</h2>
<p>On the other hand, our research confirms the stepping-stone effect does exist in the New Zealand labour market: compared to being unemployed, you’re more likely to move into higher pay from being low paid.</p>
<p>Specifically, someone unemployed for the previous 12 months has only a 1% probability of moving into higher pay in the next month. That compares to 28% for those in low-paid employment for all of the previous 12 months.</p>
<figure class="align-center ">
<img alt="Work and Income office sign" src="https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=388&fit=crop&dpr=1 600w, https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=388&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=388&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=488&fit=crop&dpr=1 754w, https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=488&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/407156/original/file-20210618-24-zdp0p6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=488&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Moving from low-paid work to better pay may be difficult, but moving from an unemployment benefit to higher pay is even less likely.</span>
<span class="attribution"><span class="source">GettyImages</span></span>
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<p>Overall, our research highlights the value of detailed, high-frequency, integrated data in assessing the nuances in the labour market landscape.</p>
<p>On top of that, it illustrates the real difficulty in climbing the wage ladder for those in long-term low-paid work. This suggests policymakers should focus on pathways to wage growth, as well as on job creation itself.</p><img src="https://counter.theconversation.com/content/162162/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gail Pacheco is a Commissioner at the NZ Productivity Commission</span></em></p><p class="fine-print"><em><span>Alexander Plum and Kabir Dasgupta do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Past research has possibly overstated the likelihood of climbing up the income ladder for low-paid workers.Alexander Plum, Senior Research Fellow in Applied Labour Economics, Auckland University of TechnologyGail Pacheco, Professor of Economics, Director of the NZ Work Research Institute, Auckland University of TechnologyKabir Dasgupta, Senior Research Fellow, Auckland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1375872020-05-06T12:20:52Z2020-05-06T12:20:52ZBlack Americans are bearing the brunt of coronavirus recession – this should come as no surprise<figure><img src="https://images.theconversation.com/files/332441/original/file-20200504-83764-k20coc.jpg?ixlib=rb-1.1.0&rect=7%2C28%2C4680%2C3085&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">When the shuttered economy reopens, how many black Americans will be left out in the cold?</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Virus-Outbreak-Unemployment-Funds/390acd85a7b94a2a8cfddfdd414dacfa/1/0">http://www.apimages.com/metadata/Index/Virus-Outbreak-Unemployment-Funds/390acd85a7b94a2a8cfddfdd414dacfa/1/0Mark Lennihan</a></span></figcaption></figure><p>As the COVID-19 pandemic worsened in April, many Americans were shocked by the extent that black Americans were being disproportionately impacted: <a href="https://www.nytimes.com/2020/04/14/opinion/sunday/coronavirus-racism-african-americans.html">higher infection rates, more deaths</a> and <a href="https://www.npr.org/2020/04/22/840276956/minorities-often-work-these-jobs-they-were-among-first-to-go-in-coronavirus-layo">greater job loss</a>.</p>
<p>But many black Americans were not surprised. </p>
<p>This is not new. The same dynamic has been going on at times of crisis for decades and generations.</p>
<p>As <a href="https://bloustein.rutgers.edu/rodgers/">a labor economist</a> and former chief economist at the U.S. Department of Labor under the Clinton administration, I know that history has shown that black Americans consistently <a href="https://theconversation.com/african-americans-economic-setbacks-from-the-great-recession-are-ongoing-and-could-be-repeated-109612">bear the brunt of recessions</a> and <a href="https://fivethirtyeight.com/features/katrina-washed-away-new-orleanss-black-middle-class/">natural disasters</a>.</p>
<h2>Economic history repeating itself</h2>
<p>Prior to this pandemic, the worst economic downturns in post-World War II America were the <a href="https://www.federalreservehistory.org/essays/recession_of_1981_82">1981-82 recession</a> and the Great Recession that followed <a href="https://www.federalreservehistory.org/essays/great_recession_of_200709">the 2007-2008 financial crisis</a>. During those downturns, the jobless rate of black Americans peaked at 20.2% and 14.8% respectively, according to my calculations. From each downturn’s onset, it took 16 and 18 months to hit those levels.</p>
<p>This pandemic has eclipsed those figures in just one month. My estimate – based on the historic link between the unemployment rate and initial claims, and April’s data – has the <a href="https://tcf.org/content/commentary/new-data-show-true-march-jobless-rate-near-20-percent/?session=1">black American unemployment rate</a> already exceeding 20%, compared to a white unemployment rate of 13%.</p>
<p>Black Americans have higher likelihoods of losing their jobs because those jobs are <a href="https://www.cnn.com/2020/04/04/economy/minority-job-losses-coronavirus/index.html">concentrated in the hardest-hit sectors of the economy</a>, such as hotels, restaurants, bars and other food services, and department stores.</p>
<p>Many who have kept their jobs face <a href="https://www.visualcapitalist.com/the-front-line-visualizing-the-occupations-with-the-highest-covid-19-risk/?mod=article_inline">higher risks of infection</a> because <a href="https://www.weforum.org/agenda/2020/04/occupations-highest-covid19-risk/">they work in “high touch” jobs</a> such as transit workers and grocery clerks.</p>
<p>Further, because they tend to <a href="https://www.brookings.edu/blog/the-avenue/2020/04/10/who-lives-in-the-places-where-coronavirus-is-hitting-the-hardest/">live in more densely populated communities</a>,
they also <a href="https://www.cdc.gov/mmwr/volumes/69/wr/mm6915e4.htm">have a harder time practicing physical distancing</a>. </p>
<p>This, along with the <a href="https://robinkelly.house.gov/sites/robinkelly.house.gov/files/2015%20Kelly%20Report.pdf">long-standing chronic health challenges</a> of many black Americans, puts them at greater risks of infection, illness and death.</p>
<h2>Fewer resources</h2>
<p>Only when <a href="https://www.washingtonpost.com/us-policy/2020/04/16/bailout-money-hospitals-slow-get-out-missing-some-places-that-need-it-most-lawmakers-industry-groups-say/">the public protested</a> did they finally pass legislation that <a href="https://khn.org/news/in-coronavirus-relief-bill-hospitals-poised-to-get-massive-infusion-of-cash/">targeted additional resources</a> to the neediest hospitals. It took until the <a href="https://www.marketwatch.com/story/the-paycheck-protection-program-has-run-out-of-money-but-its-not-the-only-option-to-keep-some-small-businesses-afloat-2020-04-20">second installment of the Paycheck Protection Program</a> for many minority and women-owned businesses to <a href="https://www.vanhollen.senate.gov/news/press-releases/van-hollen-calls-on-administration-to-ensure-minority-owned-small-businesses-are-not-shut-out-of-paycheck-protection-program-funding">get access to funds</a>.</p>
<p>Black Americans also tend to have <a href="https://www.brookings.edu/blog/up-front/2020/02/27/examining-the-black-white-wealth-gap/">access to fewer resources</a>, making it harder for them to be more resilient when faced with a challenge like a pandemic, recession or natural disaster.</p>
<p>This has been their experience during past economic recessions, but even during “normal” times, it is harder for black Americans to compete on a level playing field.</p>
<p>Lower wealth and smaller savings form part of a patchwork of <a href="https://www.mckinsey.com/industries/public-sector/our-insights/covid-19-investing-in-black-lives-and-livelihoods">long-standing structural barriers</a> that mean that in times of economic hardship, black Americans tend to get hit hardest.</p>
<p>Fewer <a href="https://www.brookings.edu/articles/unequal-opportunity-race-and-education/">education opportunities</a>, lower rates of work experience, <a href="https://hbr.org/2017/10/hiring-discrimination-against-black-americans-hasnt-declined-in-25-years">discrimination in hiring and pay</a> and <a href="https://www.brookings.edu/wp-content/uploads/2016/07/Srvy_JobsProximity.pdf">having to live further away</a> from where jobs are located all contribute to higher unemployment rates, lower earnings, greater part-time employment and more underemployment.</p>
<p>So too does the high rates of incarceration. Economists have found that when the incarcerated population is factored in, black Americans are in <a href="https://www.rsfjournal.org/content/5/5/198">no better an economic position</a> than they were back in 1950.</p>
<p>As a result of these barriers to well-paying, sustainable jobs, the budgets of black American families tend to be more vulnerable to economic shocks.</p>
<h2>A false economy?</h2>
<p>The figures also undercut pre-coronavirus claims by the Trump administration that in terms of jobs, <a href="https://www.washingtonpost.com/politics/2020/01/17/trump-takes-credit-low-black-unemployment-rates-most-black-voters-largely-disagree/">black Americans have never had it so good</a>.</p>
<p>Although the headline unemployment rate suggests black Americans over the last three years have experienced their best economy ever, when carefully examined this is not true. My analysis of Bureau of Labor Statistics data shows that the share of black high school graduates that were employed just before the coronavirus crisis took hold is still well below its pre-Great Recession level. This is also true for black college graduates.</p>
<p>And it has taken over 10 years for the incomes of black Americans <a href="https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-people.html">to return to its pre-Great Recession level</a>. This all factors in to why the economic hit of the pandemic has been so hard for black Americans.</p>
<p>Trump likes to <a href="https://www.cnbc.com/2020/02/19/white-house-report-compares-trumps-economic-record-to-obamas.html">compare the economy during his tenure to President Obama’s economy</a>, but such analysis doesn’t make sense. Trump inherited a strong economy, while President Obama inherited an economy that was reeling from the Great Recession. Trump should compare the economy under his administration to the first three years of President Bill Clinton’s second term, another peak in the economy’s expansion.</p>
<p>Under this comparison, the Trump economy looks less favorable for black Americans. Although the unemployment rate is lower, a comparison of the employment-population ratios – a measure that includes people not looking for work and is generally favored as a snapshot of labor market conditions – reveals that black Americans did better during the Clinton administration.</p>
<p>But when compared to past recessions, so too were many other Americans unprepared – even before the current crisis around 40% of American households <a href="https://www.federalreserve.gov/publications/files/2017-report-economic-well-being-us-households-201805.pdf">could not pay an unexpected bill of US$400</a>.</p>
<p>Globalization and technological change have <a href="https://psmag.com/economics/what-caused-the-decline-of-unions-in-america">weakened institutions</a> such as unions. The Trump administration has undermined <a href="https://www.epi.org/publication/deregulation-year-in-review/">policies put in place to help create safe and fair workplaces</a>.</p>
<p>Meanwhile, tax cuts that <a href="https://www.nytimes.com/2019/12/30/business/trump-tax-cuts-beat-gilti.html">favor corporations and wealthy individuals</a> and actions such as stock buybacks have further muted the impact of economic growth on Main Street.</p>
<p>The bottom line I see is that the U.S.’s failure to maintain its investments in human priorities such as education, unemployment insurance, housing and community services, and health and recreation services, is threatening the ability of all Americans to bounce back from economic adversity.</p>
<h2>Restoring resilience</h2>
<p>So what next? As a member of the New Jersey commission advising the governor on how and when to reopen, I’m looking at immediate economic concerns. But a long-term federal plan will reach more people.</p>
<p>Instead of another rehash of what typically happens, I think many black Americans – along with many Americans of all backgrounds – want a new and different response to addressing racial inequality. Polling from before the current crisis found that a <a href="https://www.pewsocialtrends.org/2019/04/09/views-of-racial-inequality/#majorities-see-advantages-for-whites-disadvantages-for-blacks">majority of people acknowledge</a> that being black hurts a person’s chance of getting ahead.</p>
<p>Black Americans have historically borne the brunt of economic downturns, so they <a href="https://www.rsfjournal.org/content/5/5/198">will need a disproportionate share of resources</a> to create and sustain their resiliency, including policies that improve opportunity, lessen overall inequality and fight discrimination.</p>
<p>I suspect that many will say the country can’t afford that kind of investment. Past surveys have indicated <a href="https://www.people-press.org/2019/04/11/little-public-support-for-reductions-in-federal-spending/">a lack of general support for increased federal spending</a> on needy Americans and it is not known if COVID-19 will have changed minds.</p>
<p>But I believe we <a href="https://www.mckinsey.com/industries/public-sector/our-insights/covid-19-investing-in-black-lives-and-livelihoods">can’t afford not to invest</a> in better, sustainable communities. Failing to do so will condemn those left vulnerable – both black, and nonblack Americans alike – to suffer from future economic shocks.</p>
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<p class="fine-print"><em><span>William M. Rodgers III does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Black Americans were left especially vulnerable to the economic impact of COVID-19 and history shows it will take them longer to rebound.William M. Rodgers III, Professor of Public Policy and Chief Economist, Rutgers UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1197222019-07-31T11:41:48Z2019-07-31T11:41:48ZHow organized labor can reverse decades of decline<p>Collective bargaining has long been one of organized labor’s most attractive selling points. </p>
<p>In its simplest form, collective bargaining involves an organized body of employees negotiating wages and other conditions of employment. In other words, unions are saying: Join us, and we’ll bargain with your boss for better pay.</p>
<p>Unfortunately, traditional collective bargaining is no longer an effective strategy for labor union growth. That’s because <a href="https://www.epi.org/publication/bp235/">employers</a> and <a href="https://theconversation.com/why-americas-labor-unions-are-about-to-die-69575">many states</a> have made it incredibly hard for workers to form a union, which is necessary for workers to bargain collectively. </p>
<p><a href="https://hbr.org/2019/01/the-tactics-media-unions-are-using-to-build-membership">My own research</a> suggests unions should pursue alternative ways to organize, such as by focusing on more forceful worker advocacy and offering benefits like health care. Doing so would help unions swell in size, putting them in a stronger position to secure and defend the collective bargaining rights that <a href="https://theconversation.com/the-rise-and-fall-of-us-labor-unions-and-why-they-still-matter-38263">helped build America’s middle class</a>.</p>
<h2>Why unions still matter</h2>
<p>Unions <a href="https://www.researchgate.net/publication/37157281_Union_Membership_Trends_in_the_United_States">reached their pinnacle</a> in the mid-1950s when a third of American workers belonged to one. Today, <a href="https://www.bls.gov/news.release/union2.t01.htm">that figure stands at</a> just 10.5%.</p>
<p>A big part of the problem is that employers have used heavy-handed <a href="https://www.epi.org/publication/bp235/">legal and managerial tactics</a> to block organizing and the elections necessary to form a union. And <a href="https://employment.findlaw.com/wages-and-benefits/what-are-right-to-work-laws.html">more than half of U.S. states</a> have passed so-called right to work laws, which allow workers at a unionized company to avoid paying dues. </p>
<p>The stakes of this challenge are high – not just for unions but for most workers in the U.S. That’s because weaker <a href="https://www.epi.org/publication/how-todays-unions-help-working-people-giving-workers-the-power-to-improve-their-jobs-and-unrig-the-economy/">unions correlate</a> with lower wages, reduced benefits and greater economic inequality. </p>
<p>Millions stand to gain from a strengthened labor movement, from <a href="https://workersolidarity.net/2019/05/15/uber-stock-sales-flop-as-global-rideshare-workers-strike/">Uber and Lyft drivers</a> in the gig economy to low-wage employees in retail and hospitality. And surveys show nearly half of nonunion workers in the U.S. <a href="https://mitsloan.mit.edu/ideas-made-to-matter/a-new-survey-takes-pulse-worker-voice-america">say they would join one</a> if they could. </p>
<p>I believe there are three models traditional unions could pursue to add members without relying on workplace certification and collective bargaining. </p>
<h2>Advocating for workers</h2>
<p>One approach is to build on the success of worker advocacy groups like <a href="https://fightfor15.org/">Fight for $15</a> and the <a href="https://www.domesticworkers.org/">National Domestic Workers Alliance</a>. </p>
<p>Fight for $15, for example, played a leading role advocating increases in the minimum wage in several states, most recently <a href="https://fightfor15.org/connecticut-victory/">Connecticut</a>, while the National Domestic Workers Alliance <a href="https://www.domesticworkers.org/bill-of-rights/new-york">helped secure the passage</a> of the domestic workers bill of rights in New York.</p>
<p>What they all have in common is that they engage in protests and strikes to call public attention to the plight of exploited workers while advocating for economic and social justice. Unions, which used to engage in more of this kind of activism, need to recapture some of that militant spirit. </p>
<h2>Establishing minimum standards</h2>
<p>A second model involves pushing employers to agree to a minimum set of standards for benefits and pay to provide workers.</p>
<p>The Writers Guild of America, which represent screenwriters and others in television, theater and Hollywood, exemplify this model. For example, they establish <a href="https://www.wgaeast.org/guild-contracts/mba/">minimum levels of compensation</a> for specific jobs and duties and then require members – both employers and workers – to adhere to them. It’s a collective bargaining agreement with a potentially much wider reach. </p>
<p>That’s because these agreements are negotiated with employers but also cover independent contractors who sign on as well. Their strength comes from the aggressive organizing and advocacy plus the strategic importance of the workers they represent, which puts pressure on employers to take part and meet the minimum standards.</p>
<p>Other unions could expand this approach to encourage workers throughout industries that have little or no labor representation to join their ranks as affiliated members, which should pressure employers to follow suit.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=477&fit=crop&dpr=1 600w, https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=477&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=477&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=600&fit=crop&dpr=1 754w, https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=600&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/286319/original/file-20190730-186814-c6metd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=600&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Unions peaked in the 1950s.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Watchf-AP-A-NJ-USA-APHS384972-Labor-Unions-Unit-/4f3c09caec404b409dec31cc37b982eb/153/0">AP Photo/Sam Myers</a></span>
</figcaption>
</figure>
<h2>Unions with benefits</h2>
<p>Another approach involves focusing on offering special benefits to independent workers in exchange for fees. </p>
<p>Some labor groups already do this, but the workers would benefit from unions combining their collective power to offer more heavily discounted goods and services, such as health care, disability benefits and legal representation.</p>
<p>For example, although the 375,000-strong <a href="https://www.freelancersunion.org/">Freelancers Union</a> can’t negotiate over pay, it offers independent contractors these sorts of discounted benefits. Instead of charging dues, it charges fees for its benefits, essentially operating as its own insurance company. It also advocates for public policy changes that safeguard freelancers from exploitation, such as New York’s <a href="http://www.nydailynews.com/news/politics/nyc-passes-law-forcing-employers-pay-freelancers-time-article-1.2847980">Freelance Wage Protection Act of 2010</a>. </p>
<p>This model is probably the approach most likely to succeed in attracting large numbers of new members. The growing gig economy and low-wage industries like fast food are two areas that could receive benefits from these types of collective entities.</p>
<h2>The endgame</h2>
<p>Ideally, unions would embrace all three of these models, offering discounted benefits to any worker interested in signing on, fighting for minimum standards across industries and putting worker advocacy front and center. By broadening the ways in which workers can join and what they offer, unions will become stronger and closer to the people and communities that they are meant to represent. </p>
<p>But by no means are these models meant to supplant organized labor’s traditional collective bargaining role. My point is that unions should break the straightjacket fixation on traditional bargaining and use alternative models as intermediate steps to the ultimate goal of unionizing more workplaces in order to negotiate collective bargaining agreements on behalf of workers. </p>
<p>To get there, though, unions must mobilize a critical mass of workers. Only then will they break the dynamic of labor’s decline.</p>
<p>[ <em>Deep knowledge, daily.</em> <a href="https://theconversation.com/us/newsletters?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=deepknowledge">Sign up for The Conversation’s newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/119722/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marick Masters receives funding from various government and nonprofit organizations and is a senior partner with AIM Consulting. </span></em></p>Unions should move their focus away from traditional collective bargaining and instead embrace new ways to attract new members, such as by offering discounted benefits and engaging in more advocacy.Marick Masters, Professor of Business and Adjunct Professor of Political Science, Wayne State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1180182019-06-06T13:36:57Z2019-06-06T13:36:57ZEmployed but still poor: the state of low-wage working poverty in South Africa<figure><img src="https://images.theconversation.com/files/278291/original/file-20190606-98027-bwylw6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Low-wage poverty is highly associated with unstable work such as in the informal sector</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Paid employment is generally considered the predominant and most sustainable way of pulling people out of <a href="https://www.ilo.org/jobspact/news/WCMS_140634/lang--en/index.htm">poverty</a>. But the past two decades have seen a global rise in the complex phenomenon of the <a href="https://www.ilo.org/global/statistics-and-databases/publications/WCMS_696387/lang--en/index.htm">working poor</a>. South Africa is no exception.</p>
<p>This delink between paid employment and poverty reduction is a major challenge for the government. It means that attention must be given to two things: rapid job creation, and also the creation of decent jobs. </p>
<p>While one may think that being employed suggests the person is immediately pulled out of poverty, this is not always the case. Finding a job does not guarantee someone will receive remuneration that is high enough to cover their basic needs and be relatively secure financially. In some cases, workers reluctantly only work part-time after failing to find full-time work. </p>
<p>Some workers are paid wages below the amount that’s necessary to maintain a decent living standard. They are also not entitled to health or retirement benefits. <a href="http://www.lse.ac.uk/business-and-consultancy/consulting/assets/documents/Low-Pay-and-In-Work-Poverty.pdf">Low-wage work</a> is also associated with poor working conditions and job insecurity. These include poor health and safety standards, discrimination and excessive work hours. </p>
<p>In other words, for some workers employment no longer guarantees significant poverty reduction. Some workers remain poor because wages are too low to lift them and their families out of poverty. </p>
<h2>Main findings</h2>
<p>Comprehensive information on the extent of low-wage working poverty in South Africa wasn’t available until our recently published <a href="https://www.tandfonline.com/doi/full/10.1080/0376835X.2019.1597682">study</a>. We examined the data from the first four waves of the National Income Dynamics Study (NIDS), which took place between 2008 and 2015. <a href="http://www.nids.uct.ac.za/about/what-is-nids">NIDS</a> is South Africa’s first national household panel study.</p>
<p>We found that while low-wage poverty probability declined during the 7-year period, in 2015 nearly 20% of workers were still identified as low-wage poor employed. This downward trend is similar to what was found by <a href="https://www.ru.ac.za/media/rhodesuniversity/content/iser/documents/The_working_poor_in_South_Africa,_1997-2012_-_Michael_Rogan_and_John_Reynolds_(2015.4).pdf">a 2015 study</a> for the 1997-2012 period, though that piece of research focused on working poverty and didn’t take the low wage threshold into consideration.</p>
<p>When it comes to demographics, low-wage poor were identified as predominantly women (slightly above 50%), Africans (90%), 38 years old on average, without 12 years of education. On average there were five members per household, and two of them were working.</p>
<p>Most low-wage poor were involved in elementary occupations. They were street vendors, domestic helpers and cleaners, and garbage collectors. And nearly 75% of this group were in the informal sector, which is associated with a lack of job security and benefits. This finding is concerning, given the fact that the informal sector only <a href="https://www.ekon.sun.ac.za/wpapers/2008/wp212008/wp-21-2008.pdf">contributes</a> about 7% of the country’s GDP.</p>
<h2>What should government do?</h2>
<p>There are ways for the government to address these issues. </p>
<p>Policy is a key area where changes can be made. The government should focus on policy that provides affordable quality education and skills training to previously disadvantaged communities. Moreover, education and training programmes should focus on skills and competencies demanded by the labour market.</p>
<p>Low-wage poverty is highly associated with the unstable work environments and insecurity that are experienced by workers in the informal sector, and workers with low-skilled occupations like domestic workers and street vendors. Policy prescriptions should therefore aim to promote economic growth and infrastructure development within the informal sector. They should also focus on increasing awareness and enforcement of labour regulations that protect workers in low-skilled or elementary occupations.</p>
<p>Speedy <a href="https://blogs.worldbank.org/jobs/how-can-new-infrastructure-accelerate-creation-more-and-better-jobs">infrastructure development</a> also helps to pave the way for the creation of more and better jobs associated with higher wages and improved working conditions.</p>
<p>It’s also important that there’s a focus on creating quality jobs and transforming existing unstable, low-paying jobs to more stable work environments that pay workers higher earnings. This involves improving the transition of workers from the informal to the formal sectors.</p>
<p>Government and the private sector should also provide small and informal business owners with easy access to financial and organisational support. These business owners need <a href="http://www.durban.gov.za/Resource_Centre/edge/Documents/Edge%2017th%20Edition%20Microbusiness%20in%20the%20Informal%20Economy.pdf">skills and knowledge</a> about everything from finances to supply chain processes and customer management to help them run and grow their businesses. </p>
<p>There should also be an increase in the awareness of minimum statutory employment conditions among elementary occupation workers and employers, together with the implementation of effective mechanisms to monitor and enforce compliance.</p>
<p>Last but not least, increasing the national minimum wage for all sectors may be a useful, if somewhat <a href="https://wol.iza.org/articles/employment-effects-of-minimum-wages/long">contentious approach</a>. Using the currently <a href="https://www.thesouthafrican.com/news/national-minimum-wage-south-africa-how-much/">proposed minimum wage</a> of R3 500 per month, the low-wage poverty rate is somewhat higher (35% in 2008 and 24% in 2015, compared to 26% and 19% respectively using the original lower-amount threshold adopted in the study).</p>
<p>Some workers argue they cannot meet their basic needs with the currently proposed minimum wage (of R3 500 per month). But a higher minimum wage helps improving their <a href="https://saefa.org.za/images/NMWreport.pdf">productivity and turnover</a>. On the other hand, some employers claim they cannot afford an increased minimum wage without running the risk of retrenching workers and replacing them with cheaper capital. In this case, the state may intervene by assisting firms with special taxation benefits, wage subsidies and training opportunities for workers.</p>
<p><em>This is an extract from the journal article titled “Employed yet poor: low-wage employment and working poverty in South Africa”, which the writer co-authored with Jade Feder, an Economics Masters graduate at the University of the Western Cape.</em></p><img src="https://counter.theconversation.com/content/118018/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Derek Yu does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Paid employment is no longer a guarantee that workers will earn enough to cover their basic needs and become relatively secure financially. Hence the global phenomenon of the working poor.Derek Yu, Associate Professor, Economics, University of the Western CapeLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/993452018-07-27T08:44:01Z2018-07-27T08:44:01ZDigital nomads: what it’s really like to work while travelling the world<figure><img src="https://images.theconversation.com/files/229441/original/file-20180726-106505-7iyjyn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">She makes it look so easy. </span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/young-beautiful-woman-hipster-traveler-freelancer-678618808?src=v9BGhLr0nfHUCcQ-HV_ILg-8-43">Shutterstock.</a></span></figcaption></figure><p>The phrase “digital nomad” summons the <a href="https://www.telegraph.co.uk/news/features/11597145/Living-and-working-in-paradise-the-rise-of-the-digital-nomad.html">trope of joyful millennials</a> who escape the daily grind to travel the world, working with laptops on far flung beaches. Bullish statistics are regularly regurgitated: “There will be <a href="https://levels.io/future-of-digital-nomads/">one billion digital nomads</a> by 2035,” the headlines declare. </p>
<p>As an <a href="https://www.merriam-webster.com/dictionary/anthropology">anthropologist</a>, I started researching digital nomadism in 2015. It took me three years to develop an understanding of what might be going on, behind the corporate jargon. I can’t offer hard statistics: until new systems such as <a href="https://e-estonia.com/digital-nomads-visa-shape-urban-employment/">Estonia’s digital nomad visa</a> – an easy route for people to live and work in Estonia for a year – get off the ground, no one can. But I’ve met hundreds of people who think of themselves as digital nomads – and many more who have dreamed about becoming one. </p>
<p>The first thing I learned is that how people feel about the label “digital nomad” changes over time. People starting out often assume it’s a permanent lifestyle – but that’s rarely the case. As one participant explained, “I went to a conference, drank the cool aid, went to Thailand. But I don’t go around calling myself a digital nomad now, it’s a bit naff”.</p>
<p>Indeed, there’s <a href="https://www.tandfonline.com/doi/abs/10.1080/21931674.2016.1229930">still debate</a> about whether it’s a buzzword or a bone fide phenomenon. Some have even <a href="https://www.tandfonline.com/doi/abs/10.1080/11745398.2017.1358098">tried to define</a> how “authentic” a digital nomads is, by how much they move from place to place. And online forums such as Reddit play host to <a href="https://www.reddit.com/r/digitalnomad/comments/65sxea/whats_the_digital_nomad_population_of_chiang_mai/">heated debates</a> about who’s a real digital nomad, and who is merely “tedious and self-promoting”. </p>
<h2>Escaping the everyday</h2>
<p>Most of the digital nomads I spoke to, who once had static jobs, told me that they were escaping from deeply rooted problems in the contemporary Western workplace. A common trigger is economic: one of my respondents, Zeb, was working three restaurant jobs to make the rent in San Francisco. The city sucked up all his time and money. This scuppered his plans to sell recycled products online. Swapping expensive California for affordable South-East Asia helped Zeb to launch his own business. </p>
<p>Even more common are objections to bad work cultures. Lissette, a skilled translator from Hamburg, Germany is able to produce high quality work quickly. She soon tired of the culture of subtle bullying and presenteeism at her workplace. She explained, “I’m efficient, I like to get the work done and leave on time. Other staff were obviously scared to leave first, so would sit at their desks on Facebook”. </p>
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<img alt="" src="https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/229460/original/file-20180726-106502-1m9of8y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">The daily grind.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/liverpool-street-station-uk-rush-hour-28415320?src=V4LCtqXffEyOCLZbX06Yxw-1-100">Shutterstock.</a></span>
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<p>Activist and anthropologist David Graeber uses the phrase “<a href="http://strikemag.org/bullshit-jobs/">bullshit jobs</a>” to refer to pointless work: apt, given that <a href="https://yougov.co.uk/news/2015/08/12/british-jobs-meaningless/">nearly 40% British adults</a> believe their jobs are meaningless. This could be expanded to include <a href="https://www.resolutionfoundation.org/media/press-releases/up-to-a-third-of-millennials-face-renting-from-cradle-to-grave/">bullshit housing</a> (poor quality and too expensive), or bullshit economies, which <a href="https://theconversation.com/young-people-are-leading-a-growing-movement-against-low-pay-and-precarious-work-97202">don’t provide young people</a> with wages they can live on. Faced with these challenges, it’s hardly surprising that those new to the world of work are already desperate to escape. </p>
<h2>CEO of Me Inc.</h2>
<p>Yet there are <a href="https://www.theguardian.com/commentisfree/2018/jun/18/digital-nomad-homeless-tech-work">certain complexities</a> that come with living as a citizen of the world. As Lissette said, “digital nomads can quickly become isolated or unaccountable”. </p>
<p>Digital nomads have to shoulder responsibility for almost every aspect of modern life: their <a href="https://www.simplypsychology.org/maslow.html">mental health, daily routine, income, safety and shelter</a>. Most digital nomads travel on tourist visas, which require them to up sticks and move regularly – an experience my participants have described as disorienting. </p>
<p>On top of all this, many digital nomads run their own businesses, and face pressure to develop distinctive personal brands. They often can’t attend in-person meetings or pitches, so they need an online marketing strategy that will get them noticed and win clients. </p>
<p>Workers are forced to think of themselves as the “<a href="https://www.fastcompany.com/28905/brand-called-you">CEO of Me Inc.</a>”: this means having a unique brand, a marketing strategy and sales skills. They often have to do their own graphic design, copywriting and web design as well. Anthropologist Iliana Gershon has explored <a href="https://anthrosource.onlinelibrary.wiley.com/doi/abs/10.1111/plar.12075">personal branding in Silicon Valley</a>, and found that many workers there need such skills just to get a job in a traditional office. So digital nomads are taking this trend to a new extreme. </p>
<h2>Are you happy?</h2>
<p>For those digital nomads who make a living as professional bloggers, it’s also part of their job to sell the lifestyle. As a result, many try and project a stable, and happy image online. Lissette explained: </p>
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<p>There’s a danger, that when my aunt looks at Instagram, she sees that everything looks so happy here on the beach. Of course, my digital identity always looks happier than my life is. </p>
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<p>But at some point, most of my research participants have lamented the loss of some aspect of location dependence, a chat over a water cooler, regular work hours, an office party. They miss some of the things they are escaping. </p>
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<img alt="" src="https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/229447/original/file-20180726-106517-qrroxl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Lost at sea.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/mockup-image-woman-using-laptop-blank-1008790915?src=v9BGhLr0nfHUCcQ-HV_ILg-1-96">Shutterstock.</a></span>
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<p>It’s hardly surprising that blogs and articles aimed at digital nomads obsess over the recurring themes of <a href="https://www.forbes.com/sites/kaviguppta/2015/02/25/digital-nomads-are-redefining-what-it-means-to-be-productive/#3be18c423689">productivity</a>, <a href="http://www.makingitanywhere.com/digital-nomad-skills/">resilience</a>, positive thinking, focus and mindfulness. But the flipside to all this relentless positivity is <a href="https://hackernoon.com/i-went-full-nomad-and-it-almost-broke-me-2a02c5e8f138">burnout</a>. As one participant told me, “it’s all too easy to lose yourself in a sea of choices”. </p>
<p>As social entrepreneur <a href="https://hackernoon.com/i-went-full-nomad-and-it-almost-broke-me-2a02c5e8f138">Sam Applebee</a> explains, burnout creeps up on people slowly, while “your self-awareness and the ability to save yourself erodes”. Many nomads I’ve interviewed just pack up and go home without telling anyone. Others pop home because they had too much stuff stored with friends and family, fully intending to go back out on the road – but never do. </p>
<p>Digital nomadism can be rewarding, and offers an escape from the drudgery of office life. But it’s important that aspiring digital nomads read up and think deeply about the importance of community and mental health in their lives. Freedom does not mean the same thing for everyone. </p>
<p><em>Names of participants have been changed to protect their anonymity.</em></p><img src="https://counter.theconversation.com/content/99345/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Dave Cook does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Go beyond the corporate jargon to really understand the freedom and challenges that come with being a digital nomad.Dave Cook, PhD Researcher, Anthropology, UCLLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/967142018-05-16T04:13:15Z2018-05-16T04:13:15ZThe RBA’s shift to worrying about financial stability could be hurting Australian wages<p>The Reserve Bank of Australia (RBA) is making an explicit trade-off between inflation and financial stability concerns. And this could be weighing on Australians’ wages. </p>
<p>In the past, the RBA focused more on keeping inflation in check, the usual role of the central bank. But now the bank is playing more into concerns about financial stability risks in explaining why it is persistently undershooting the middle of its inflation target.</p>
<p>In the wake of the global financial crisis, the federal Treasurer and Reserve Bank governor signed an updated <a href="http://www.rba.gov.au/monetary-policy/framework/stmt-conduct-mp-5-30092010.html">agreement</a> on what the bank should focus on in setting interest rates. This included a new section on financial stability. </p>
<p>That statement made clear that financial stability was to be pursued without compromising the RBA’s traditional focus on inflation.</p>
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<a href="https://theconversation.com/why-the-rba-needs-to-talk-about-future-interest-rate-policy-93292">Why the RBA needs to talk about future interest-rate policy</a>
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<p>The latest <a href="http://www.rba.gov.au/monetary-policy/framework/stmt-conduct-mp-7-2016-09-19.html">agreement</a>, adopted when Philip Lowe became governor of the bank in 2016, means the bank can pursue the financial stability objective even at the expense of the inflation target, at least in the short-term.</p>
<p>While the RBA board has <a href="https://www.rba.gov.au/monetary-policy/rba-board-minutes/2018/2018-02-06.html">explained</a> its recent steady interest rate decisions partly on the basis of risks to financial stability, this sits uneasily with what the RBA otherwise has to say about underlying fundamentals of our economy. </p>
<p>It correctly blames trends in house prices and household debt on a lack of supply of housing, and not on excessive borrowing. These supply restrictions amplify the response of house prices to changes in demand for housing. RBA <a href="https://www.rba.gov.au/publications/rdp/2018/pdf/rdp2018-03.pdf">research</a> estimates that zoning alone adds 73% to the marginal cost of houses in Sydney.</p>
<p><a href="http://www.apra.gov.au/MediaReleases/Pages/14_30.aspx">Restrictions</a> on lending growth by the Australian Prudential Regulation Authority since the end of 2014 have been designed to give housing supply a chance to catch-up with demand and to maintain the resilience of households against future shocks.</p>
<p>The RBA argues that it needs to balance financial stability risks against the need to stimulate the economy through lower interest rates. But this has left inflation running below the middle of its target range and helps explain why wages growth has been weak. </p>
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<a href="https://theconversation.com/why-new-zealand-cant-outsource-employment-policy-to-its-central-bank-87522">Why New Zealand can't outsource employment policy to its central bank</a>
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<p>The official cash rate has been left unchanged since August 2016, the longest period of steady policy rates on record. The fact that inflation has undershot its target of 2-3% is the most straightforward evidence that monetary policy has been too restrictive.</p>
<p>While long-term interest rates in the US continue to rise, reflecting expectations for stronger economic growth and higher inflation, Australia’s long-term interest rates have languished.</p>
<p>Australian long-term interest rates are below those in the US by the <a href="https://fred.stlouisfed.org/graph/fredgraph.png?g=jRoG">largest margin</a> since the early 1980s. This implies the Australian economy is expected to underperform that of the US in the years ahead.</p>
<p>Inflation expectations (implied by Australia’s long-term interest rates) have been stuck around 2% in recent years, below the Reserve Bank’s desired average for inflation of 2.5%. </p>
<p>Financial markets can be forgiven for thinking the RBA will not hit the middle of its 2-3% target range any time soon. The RBA doesn’t believe it will either, with its deputy governor Guy Debelle repeating the word “gradual” no less than 12 times in a <a href="https://www.rba.gov.au/speeches/2018/sp-dg-2018-05-15-1.html">speech</a> when describing the outlook for inflation and wages. </p>
<p>Inflation has been below the midpoint of the target range since the December quarter in 2014. On the RBA’s own <a href="https://www.rba.gov.au/publications/smp/2018/feb/">forecasts</a> inflation isn’t expected to return to the middle of the target range over the next two years.</p>
<p>The Reserve Bank blames low inflation on slow wages growth, claiming in its most recent <a href="https://www.rba.gov.au/publications/smp/2018/feb/">statement on monetary policy</a>that “labour costs are a key driver of inflationary pressure”. But this is putting the cart before the horse.</p>
<p>In fact, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/1475-4932.12401?af=R">recently published research</a> shows that it is low inflation expectations that are largely to blame for low wages growth.</p>
<p>Workers and employers look at likely inflation outcomes when negotiating over wages. These expectations are in turn driven by perceptions of monetary policy.</p>
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Read more:
<a href="https://theconversation.com/should-banks-be-compelled-to-pass-on-interest-rate-cuts-4579">Should banks be compelled to pass on interest rate cuts?</a>
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<p>Below target inflation makes Australia less resilient to economic shocks, not least because it works against the objective of stabilising the household debt to income ratio. Subdued economic growth and inflation also gives the economy a weaker starting point if and when an actual shock does occur, potentially exacerbating a future downturn.</p>
<p>When the RBA governor and the federal treasurer renegotiate their agreement on monetary policy after the next election, the treasurer should insist on reinstating the wording of the 2010 statement that explicitly prioritised the inflation target over financial stability risks.</p>
<p>If the RBA continues to sacrifice its inflation target on the altar of financial stability risks, inflation expectations and wages growth will continue to languish and the economy underperform its potential.</p><img src="https://counter.theconversation.com/content/96714/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Stephen Kirchner is affiliated with the Fraser Institute. </span></em></p>If the RBA continues to sacrifice its inflation target on the altar of financial stability risks, inflation expectations and our wages growth will continue to languish.Stephen Kirchner, Program Director, Trade and Investment, United States Studies Centre, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/959082018-05-04T14:11:26Z2018-05-04T14:11:26ZWhat is full employment? An economist explains the latest jobs data<figure><img src="https://images.theconversation.com/files/217610/original/file-20180503-153878-14bfk05.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Jobs a-plenty.</span> <span class="attribution"><span class="source">AP Photo/Danny Johnston</span></span></figcaption></figure><p>The latest jobs report has gotten a lot of <a href="https://www.washingtonpost.com/business/why-even-a-39percent-unemployment-rate-might-not-be-full-quicktake/2018/05/04/8e2c1ea4-4f99-11e8-85c1-9326c4511033_story.html?noredirect=on">analysts</a>, policymakers and talking heads once again asking whether the U.S. is at full employment. </p>
<p>The Bureau of Labor Statistics reported on May 4 that the <a href="https://www.bls.gov/news.release/pdf/empsit.pdf">U.S. unemployment rate</a> fell to 3.9 percent, which is the <a href="https://data.bls.gov/timeseries/LNS14000000">lowest level</a> since December 2000. The unemployment rate includes anyone 16 or older who is actively searching for work in its calculation, which means students, retirees and others not in the labor force are excluded.</p>
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<p>Does this mean the economy is at full employment? What is full employment anyway? </p>
<p>To the typical person on Main Street, the idea of full employment usually means everyone in the country is working, which would imply a jobless rate of essentially zero. This has never happened. The lowest unemployment rate the U.S. ever achieved was <a href="http://www2.census.gov/library/publications/1975/compendia/hist_stats_colonial-1970/hist_stats_colonial-1970p1-chD.pdf">1.2 percent in 1944</a>. That was during the middle of World War II, when millions of men were drafted to fight and their jobs were filled by women. </p>
<p>This popular concept sounds nice, but, to economists like me, it misses the mark. Even in a fully employed, robust economy, there will always be a certain number of people who have given up looking for work, who are between jobs or whose skills are temporarily not needed.</p>
<p>Essentially, the idea of full employment is that so few workers are available that companies need to begin raising wages to attract help.</p>
<p>Economists technically define full employment as any time a country has a jobless rate equal or below what is known as the “<a href="https://fred.stlouisfed.org/series/NROUST">non-accelerating inflation rate of unemployment</a>,” which goes by the soporific acronym <a href="https://www.vox.com/2014/11/14/7027823/nairu-natural-rate-unemployment">NAIRU</a>. </p>
<p>Estimates of the measure are based on the historical relationship between the unemployment rate and changes in the pace of inflation. If the unemployment rate is below this number, the economy is at full employment, businesses cannot easily find workers, and inflation and wages typically rise. If not, then there are too many workers in need of a job, and inflation remains low.</p>
<p>At the moment, the <a href="https://www.cbo.gov/sites/default/files/recurringdata/51135-2018-04-economicprojections_1.xlsx">Congressional Budget Office puts NAIRU</a> at 4.6 percent, a little above the 3.9 percent unemployment rate. That means the U.S. is at full employment – and that wages should be going up. But until recently, <a href="https://www.epi.org/nominal-wage-tracker/">they haven’t gained much</a>, which <a href="https://hbr.org/2017/10/why-wages-arent-growing-in-america">has puzzled</a> many economists. </p>
<p>Besides the impact on wages, another reason it’s useful to understand the definition of full employment is because maintaining it is one of the <a href="https://www.federalreserve.gov/faqs/money_12848.htm">Federal Reserve’s key mandates</a> when setting interest rates. The central bank tends to lower rates when unemployment is relatively high and raise them when it believes the economy is at full employment and wages are beginning to go up.</p>
<p>In other words, full employment isn’t when everyone has a job. Instead, it is when <a href="http://businessmacroeconomics.com/">inflation</a> starts to rise because businesses cannot find enough workers. </p>
<p>While the U.S. may be technically at full employment, according to the definition, I won’t be convinced until paychecks start increasing.</p><img src="https://counter.theconversation.com/content/95908/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jay L. Zagorsky does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The unemployment rate is now at its lowest level in 17 years and is very close to a 50-year low. Does that mean we’re at full employment?Jay L. Zagorsky, Economist and Research Scientist, The Ohio State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/914022018-03-22T19:08:33Z2018-03-22T19:08:33ZLow-paid ‘women’s work’: why early childhood educators are walking out<figure><img src="https://images.theconversation.com/files/207223/original/file-20180221-132650-q1qv95.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">What might be achieved from the proposed walkout is difficult to predict.</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Australia’s early childhood educators, including those working in community and private childcare centres, will walk off the job on March 27 to demand <a href="http://www.unitedvoice.org.au/big_walk_off_announcement">better pay</a>. Some centres will be closed for the whole day and parents will be asked to keep their children at home.</p>
<p>This scale of action will no doubt come at a cost to the economy and cause substantial inconvenience to thousands of families. It’s part of a long-running equal pay campaign. </p>
<p>Early childhood educators are among the lowest-paid Australians, with many taking on a second job for a supplementary income. Many <a href="https://theconversation.com/one-in-five-early-childhood-educators-plan-to-leave-the-profession-61279">leave the sector</a> altogether – with low pay identified as the central reason for doing so. This means the sector <a href="https://eprints.qut.edu.au/101622/1/Brief_report_ECEC_Workforce_Development_Policy_Workshop_final.pdf">loses skilled workers</a> at a time when its workforce should be growing in size.</p>
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<a href="https://theconversation.com/one-in-five-early-childhood-educators-plan-to-leave-the-profession-61279">One in five early childhood educators plan to leave the profession</a>
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<p>Many would agree current wage levels don’t reflect the <a href="http://www.oecd.org/education/starting-strong-iv-9789264233515-en.htm">importance of caring for and educating children</a>. Positive outcomes for children’s development and emotional security have significant implications for the welfare of families and future economic prosperity. </p>
<h2>Low pay</h2>
<p>Reasons for low pay in the early childhood sector include a high proportion of female workers, the dependency of educators on <a href="https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/modern-awards#what-is-a-modern-award">modern awards</a> that set minimum standards of pay and conditions, and various funding models that operate in the sector.</p>
<p>Certificate III qualified educators <a href="http://awardviewer.fwo.gov.au/award/show/MA000120#P279_28075">receive A$809 per week before tax</a>, which is around half the <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6302.0">average weekly earnings for all occupations</a>. There is little difference between educator pay rates under the Children’s Services Award, which covers the majority of workers, and the Australian national minimum wage of <a href="https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/minimum-wages">$18.29 per hour before tax</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/207224/original/file-20180221-132642-7ebo8c.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">In highly feminised, caring occupations, there is a tendency to preference the needs of children and families above employees.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
</figcaption>
</figure>
<p>Some educators leave for better paid and less challenging work elsewhere, often without the requirement for qualifications. For example, educators can earn more money doing night retail work than in the <a href="http://www.pc.gov.au/inquiries/completed/childcare/submissions/initial/submission-counter/sub121-childcare.pdf">work they are qualified to undertake</a>. Low wages also contribute to early childhood work being viewed not as a long-term career path, but a temporary employment solution.</p>
<p>Our <a href="https://eprints.qut.edu.au/101622/1/Brief_report_ECEC_Workforce_Development_Policy_Workshop_final.pdf">own study</a> of 85 educators in nine <a href="https://www.mychild.gov.au/childcare-information/options">long daycare centres</a> (places where children can be cared for throughout the full day) in Queensland showed educators got significant satisfaction from their work with children. But their continued employment in the sector relied on supplementary income to cover life’s necessities. </p>
<p>For some, their wages were supplemented by a partner who earned a higher income. Others received financial assistance from their parents or worked a second job. Those without additional financial support struggled and were more likely to consider leaving the sector.</p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/early-childhood-educators-rely-on-families-to-prop-up-low-income-research-finds-69283">Early childhood educators rely on families to prop up low income, research finds</a>
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</em>
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<h2>Women’s work</h2>
<p>Like many other countries, Australia’s early childhood workforce is <a href="http://www.pc.gov.au/inquiries/completed/childcare/submissions/initial/submission-counter/sub121-childcare.pdf">female dominated</a>, consisting of more than 90% women. </p>
<p>Working with young children is often perceived as similar to mothering and something instinctive and enjoyable to women. This view is <a href="http://www.abc.net.au/news/2017-01-12/childcare-workers-open-letter-to-david-leyonhjelm/8178296">perpetuated by government</a>, the broader community, and, sometimes, educators themselves.</p>
<p>There is a tendency to preference the needs of children and families above childcare employees. This has been seen in responses to calls for increased wages, where public and political concern has focused on the consequent <a href="https://au.news.yahoo.com/a/38447659/childcare-fees-could-rise-if-educators-succeed-in-pay-claim/">increased cost to parents</a> using early childhood services.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/207225/original/file-20180221-132654-56pp05.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Although educator wages are low, they are by far the most significant component of the budget of any early childhood service provider.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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</figure>
<h2>Industrial issues</h2>
<p>More than 70% of early <a href="http://www.pc.gov.au/inquiries/completed/education-workforce-early-childhood/report/early-childhood-report.pdf">childhood educators are award dependent</a>, compared to only 20% of the broader Australian workforce. This means most educators are paid close to the minimum wage, with low variability in pay. </p>
<p>Although some employers attempt to pay more, it’s rare for wages to exceed the award by more than 10%.</p>
<p>The ability for educators to increase their earnings is further reduced by a relatively flat career structure. Length of service is not reflected in salary. Also, opportunities for collective bargaining are restricted by a fragmented sector characterised by numerous single operators with a small number of employees.</p>
<p>Degree-qualified early childhood teachers are particularly disadvantaged. In most states and territories, preschool teachers’ pay is <a href="https://www.pc.gov.au/inquiries/completed/childcare/report/childcare-volume2.pdf">comparable to that of school teachers</a>, but the same teacher leading a preschool program in a long daycare centre could be paid A$7-8 less per hour. This reflects a difference of more than A$13,000 per year.</p>
<h2>Funding models</h2>
<p>Although educator wages are low, they represent around 70% of operating costs for providers. The ability to pay educators more depends on the budget of a given service.</p>
<p>Early childhood services in Australia gain income through parent fees and government funding. Different financial models are used for different service types. </p>
<p>Standalone preschools receive “<a href="https://qed.qld.gov.au/earlychildhood/service/Documents/pdf/queensland-kindergarten-funding-2017.pdf">supply-side funding</a>”, where money flows to the service mainly from government and is linked to operational costs such as the wages of qualified teachers and educators.</p>
<p>In contrast, long daycare services are subject to “demand-side funding”. In this model, there is no <a href="https://www.pc.gov.au/research/ongoing/report-on-government-services/2018/child-care-education-and-training/early-childhood-education-and-care/rogs-2018-partb-chapter3.pdf">operational subsidy</a> for providers. Instead, funding is linked to parent fees and designed to <a href="https://www.education.gov.au/child-care-subsidy-0">offset the cost of care for individual families</a>. </p>
<p>These funding systems mean any wage increase in a preschool is largely funded by government, with reduced impact on parent fees. But in long day care, wage increases are more likely to require increased parent fees.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/207230/original/file-20180221-132680-legrb6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Parent fees and government funding are the main income for early childhood services.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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<h2>Where to next for the early childhood sector?</h2>
<p>The current Australian government maintains that wages are a <a href="https://docs.education.gov.au/system/files/doc/other/early_years_workforce_strategy_0_0_0.pdf">matter for employers and employees</a>. Unions and some employers argue there should be greater public investment in education and care to enable an urgent increase to wages. </p>
<p>Based on <a href="https://eprints.qut.edu.au/101622/">our research</a>, and an understanding of the Australian education and care sector, improving wages is a shared responsibility. Employers clearly have a significant responsibility toward their employees and some could do better. There is also a need for greater investment from government. </p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/how-are-we-doing-on-early-childhood-education-and-care-good-but-theres-more-to-do-89275">How are we doing on early childhood education and care? Good, but there's more to do</a>
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<p>There are lessons to be learnt from national and international examples. In Queensland, the <a href="https://qed.qld.gov.au/earlychildhood/service/Documents/pdf/queensland-kindergarten-funding-2017.pdf">Kindergarten Funding Scheme</a> offers a per-child subsidy to support the delivery of a quality preschool education program delivered by a qualified teacher in long day care. </p>
<p>Canada has <a href="https://news.ontario.ca/edu/en/2016/01/2016-wage-enhancement-for-early-childhood-educators.html">recently introduced</a> an early childhood wage enhancement program. In New Zealand, <a href="http://www.education.govt.nz/early-childhood/running-an-ece-service/employing-ece-staff/attestation/">funding incentives</a> have been rolled out for early childhood services with highly qualified educators.</p>
<p>What might be achieved from the proposed walkout is difficult to predict. At the very least, the action is likely to build awareness of longstanding challenges in early childhood education. It might also secure broader community support for wages and conditions that reflect the importance and complexity of early education work.</p><img src="https://counter.theconversation.com/content/91402/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Susan Irvine is a member of Early Childhood Australia and has received grant funding from the Australian Research Council and Queensland Department of Education.</span></em></p><p class="fine-print"><em><span>Karen Thorpe has received funding from The Australian Research Council and the Queensland Department of Education to investigate the early years workforce</span></em></p><p class="fine-print"><em><span>Paula McDonald receives funding from the Australian Research Council. </span></em></p>Research shows early childhood educators are among the lowest-paid Australians, with some finding better pay in other fields such as night-time retail work.Susan Irvine, Associate Professor, School of Early Childhood and Inclusive Education, QUT, Queensland University of TechnologyKaren Thorpe, Professor, Research Group leader Development education and Care, The University of QueenslandPaula McDonald, Professor of Work and Organisation, Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/909002018-01-31T07:20:20Z2018-01-31T07:20:20Z3 key quotes from Trump’s first State of the Union, explained<p><em>Editor’s note: President Donald Trump, <a href="https://www.bloomberg.com/news/live-blog/2018-01-25/u-s-president-trump-delivers-state-of-the-union-address">in his first State of the Union address</a>, took credit for a growing economy, urged Congress to invest more in infrastructure and defense and promoted an immigration plan that ties citizenship for <a href="https://theconversation.com/us/topics/dreamers-24037">Dreamers</a> to border security and an end to family-based migration. During the <a href="https://www.nbcnews.com/storyline/2018-state-of-the-union-address/trump-there-has-never-been-better-time-start-living-american-n842706">80-minute speech</a> – the third-longest State of the Union – he touched on a wide range of topics, from the <a href="https://theconversation.com/us/topics/opioids-1046">opioid crisis</a> and <a href="https://theconversation.com/us/topics/gangs-3291">MS-13</a> to <a href="https://theconversation.com/us/topics/north-korea-2060">North Korea</a> and <a href="https://theconversation.com/us/topics/foreign-aid-988">foreign aid</a>. We asked three academics to choose key quotes and add the context missing from the <a href="http://www.newsweek.com/state-union-full-text-795748">president’s words</a>.</em></p>
<h2>Stick to the facts – they’re good enough</h2>
<p><strong>Greg Wright, University of California, Merced</strong></p>
<blockquote>
<p>“This is in fact our new American moment. There has never been a better time to start living the American Dream.”</p>
</blockquote>
<p>To back this up, Trump said we’re finally seeing rising wages after years of stagnation, noted that the stock market is smashing “one record after another” and highlighted Apple’s recent plan to “invest a total of $350 billion in America” and hire 20,000 workers.</p>
<p>While the newness of this moment in American history is debatable, the economy under President Trump is following a well-worn path set down by the previous administration. And that’s fairly good news indeed. The question is, can he claim credit for any of it?</p>
<p>It is true that we are finally seeing <a href="https://qz.com/1119584/us-unemployment-rate-jobs-are-plentiful-real-wage-growth-is-poor/">rising wages</a>, but these gains go back well into the Obama administration, and in fact the past year has seen only <a href="https://www.bls.gov/news.release/pdf/wkyeng.pdf">modest wage growth</a>. The stock market’s <a href="http://money.cnn.com/2018/01/16/investing/dow-26000-stocks-wall-street/index.html">winning streak</a> is impressive. Of course, this trend also <a href="http://www.politifact.com/truth-o-meter/article/2018/jan/08/how-trump-obama-compare-stock-market/">began under Obama</a>. </p>
<p>The key point is that these economic trends are largely beyond the control of the current administration, or any administration, for better or worse. As an example, real income <a href="https://qz.com/1119584/us-unemployment-rate-jobs-are-plentiful-real-wage-growth-is-poor/">fell</a> over Trump’s first year in office in part due to rising inflation, which eats into every dollar’s buying power. There’s not a lot a president can do about inflation. </p>
<p>What about increased investment by U.S. companies like Apple? Here the president is on surer footing in claiming that the tax cuts he signed into law last year are having an impact. Unfortunately, Apple <a href="https://slate.com/business/2018/01/no-apple-is-not-creating-20-000-jobs-because-of-the-tax-bill.html">is not investing</a> $350 billion – at least not yet, it’s simply repatriating money it has always had access to – and its <a href="https://www.apple.com/newsroom/2018/01/apple-accelerates-us-investment-and-job-creation/">plans</a> to add 20,000 jobs appear largely unrelated to tax cuts or other government policies. </p>
<p>At the same time, the tax cuts will <a href="http://fortune.com/2017/12/16/gop-tax-bill-winners-and-losers/">undoubtedly spur</a> new capital investments, some of which <a href="https://www.economist.com/news/finance-and-economics/21730696-white-house-report-puts-economists-each-others-throats-will-corporate-tax-cuts">may eventually lead</a> to modest pay raises for U.S. workers, credit for which should go to President Trump and congressional Republicans. </p>
<p>Trump also highlighted Exxon Mobil’s <a href="https://www.cnbc.com/2018/01/29/exxon-mobil-to-invest-50-billion-in-us-over-5-years-citing-tax-reform.html">very recent announcement</a> that it will invest billions in the U.S. as a response to the tax bill. Once again, Trump’s actual words turned out to be too good to be true. He boasted $50 billion, but $15 billion of that was previously announced. Still, $35 billion as a result of the tax cuts is serious money.</p>
<p>In summary, on the economic front there is basically good news. Good enough, in fact, to be honest with the American people about the state of the union.</p>
<h2>The state of our infrastructure</h2>
<p><strong>Steven Pressman, Colorado State University</strong></p>
<blockquote>
<p>“It is time to rebuild our crumbling infrastructure … I am asking both parties to come together to give us the safe, fast, reliable and modern infrastructure our economy needs and our people deserve.”</p>
</blockquote>
<p>The president is right about this. U.S. infrastructure is in utter disrepair. The American Society of Civil Engineers <a href="https://www.infrastructurereportcard.org/wp-content/uploads/2016/10/2017-Infrastructure-Report-Card.pdf">gave it a D+ grade</a> in its most recent report. Trump proposed spending $1.5 trillion to fix the problem. </p>
<p>While tackling it is surely necessary, the president’s solution is flawed in terms of both timing and method.</p>
<p>First, the timing. An infrastructure program <a href="https://www.americanprogress.org/issues/economy/reports/2011/09/08/10257/government-spending-can-create-jobs-and-it-has/">was needed</a> in 2009, after the U.S. economy collapsed and job creation was paramount. But today, unemployment stands at <a href="https://data.bls.gov/timeseries/LNS14000000">4.1 percent</a>, near full employment. The new tax law passed in December <a href="https://taxfoundation.org/final-tax-cuts-jobs-act-state-impact/">will likely</a> further boost spending and reduce unemployment. Except during wars, when young men were fighting overseas rather than making things in the U.S., the <a href="https://fred.stlouisfed.org/series/UNRATE">unemployment rate has rarely</a> dipped below 4 percent over the past 70 years. With <a href="https://www.npr.org/2017/08/02/541104795/trump-to-unveil-legislation-limiting-legal-immigration">immigration off the table</a>, where will we find the workers to build this infrastructure?</p>
<p>Second, in terms of method, the president wants state and local governments to “partner” in infrastructure projects and pay part of the cost. This will require that they raise taxes. Areas in good financial health, such as New York City, will be able to do this. Areas struggling economically and in most desperate need, such as Flint, Michigan, will not.</p>
<p>In my view, the economic problem we face today is not insufficient spending, which <a href="https://www.pragcap.com/wp-content/uploads/2015/06/keynes-and-deficits-collier.pdf">an infrastructure program would remedy</a>, but <a href="http://rooseveltinstitute.org/inequality-stagnation-market-power/">excessive corporate power</a> that is hurting American workers. The real incomes of full-time U.S. workers, which have stagnated for decades, <a href="https://www.bls.gov/news.release/pdf/wkyeng.pdf">fell by 1 percent in 2017 alone</a>, even as <a href="https://www.cnbc.com/2017/12/29/us-stocks-open-higher-sp-500-tracking-for-best-year-since-2013.html">stocks</a> and <a href="https://www.usnews.com/news/business/articles/2017-05-23/only-on-ap-ceos-got-biggest-raise-since-2013">CEO pay</a> soared.</p>
<p>The solution to this problem involves strengthening worker rights, not weakening them, as the <a href="https://www.americanprogressaction.org/issues/economy/reports/2018/01/26/168366/president-trumps-policies-hurting-american-workers/">Trump administration policies have been doing</a>. I believe giving workers a meaningful raise is far more important than improving our nation’s infrastructure – as bad as it is, our paychecks are worse. </p>
<h2>A non-compromise on immigration</h2>
<p><strong>Stephanie L. Canizales, University of Southern California</strong></p>
<blockquote>
<p>“It is time to reform these outdated immigration rules and finally bring our immigration system into the 21st century. These four pillars represent a down-the-middle compromise, and one that will create a safe, modern and lawful immigration system.”</p>
</blockquote>
<p>The four pillars the president outlined in his speech include a path to citizenship for 1.8 million immigrants brought to the U.S. as undocumented children, increased border enforcement, termination of the visa lottery and an end to “chain migration.” </p>
<p>I believe the first proposal rightfully brings Dreamers out of limbo, and I applaud the president for taking this stand. The other three “pillars,” however, rest on shaky foundations that deserve closer scrutiny.</p>
<p>Trump’s second pillar - more border enforcement - seems to be premised on the notion that new immigrants are synonymous with drugs, gangs and depressed job and wage growth, and that only his “beautiful wall” and more border agents can protect Americans. This ignores the fact that immigrants are <a href="https://www.americanimmigrationcouncil.org/research/criminalization-immigration-united-states">less likely to commit serious crimes</a> than native-born Americans. As for MS-13, which Trump spotlighted as a source of violence in his speech, it is a homegrown gang, <a href="http://www.bbc.com/news/world-us-canada-39645640">born and bred in the streets of Los Angeles, California</a>, not native to Central America.</p>
<p>As for claims that immigrants hurt natives, the <a href="https://theconversation.com/want-a-stronger-economy-give-immigrants-a-warm-welcome-73264">evidence is clear</a> and <a href="https://theconversation.com/daca-isnt-just-about-social-justice-legalizing-dreamers-makes-economic-sense-too-90603">substantial</a> that they do not. Little competition occurs for the low-wage occupations that employ undocumented immigrants, such as those in <a href="http://www.latimes.com/projects/la-fi-farms-immigration/">agriculture</a>, <a href="http://www.youthcirculations.com/blog/2015/9/9/fast-fashion-slow-integration-guatemalan-youth-navigate-life-and-labor-in-los-angeles">garment manufacturing</a>, and <a href="https://www.newyorker.com/magazine/2016/04/11/the-sacrifices-of-an-immigrant-caregiver">domestic work</a>. In fact, removing immigrants would <a href="http://fortune.com/2017/09/08/trump-undocumented-immigrants-daca/">hurt our economy</a> through the loss of sales taxes, property taxes and other economic contributions.</p>
<p>Trump’s third proposal, to terminate the visa lottery, willfully misrepresents immigration law. The <a href="https://www.us-immigration.com/greencard/Green-Card-Lottery.html">diversity visa lottery</a> - despite its name - does not “randomly hand out green cards” but allocates 50,000 visas each year to countries with low rates of migration. To be eligible, applicants must meet various educational, occupational, security and health criteria. </p>
<p>And his fourth pillar not only contains falsehoods but a <a href="https://www.usatoday.com/story/news/world/2018/01/11/what-chain-migration-and-why-does-trump-want-end/1022479001/">derogatory slur</a> that dehumanizes the men, women and children who seek a new life in the U.S. Trump’s desire to end “chain migration” rests on claims, which he repeated in the address, that immigrants with permission to remain in the U.S. exploit current policy by sponsoring “virtually unlimited numbers of distant relatives” to join them.</p>
<p>This is far from the truth. Only parents, spouses and unmarried minor children <a href="https://www.uscis.gov/ilink/docView/SLB/HTML/SLB/0-0-0-1/0-0-0-29/0-0-0-1083.html">may be sponsored</a> through family-based immigration.</p>
<p>The pillars Trump proposes are not, in my view, a “down-the-middle” compromise with the guarantee of a “safe, modern and lawful” system. If lawmakers agree to such a plan, all immigrant communities would pay a steep price, even if protecting Dreamers is a worthy goal.</p><img src="https://counter.theconversation.com/content/90900/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Trump touted his administration’s economic successes and laid out his immigration plan in an 80-minute speech to Congress. Our experts weigh in.Steven Pressman, Professor of Economics, Colorado State UniversityGreg Wright, Assistant Professor of Economics, University of California, MercedStephanie L. Canizales, Ph.D. Candidate, USC Dornsife College of Letters, Arts and SciencesLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/906042018-01-30T11:33:39Z2018-01-30T11:33:39ZHere’s how workers would spend the corporate tax cut – if they had a voice<figure><img src="https://images.theconversation.com/files/203884/original/file-20180129-117708-jh29a4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Having a bullhorn is nice, but workers need more to elevate their voices.</span> <span class="attribution"><span class="source">AP Photo/David Goldman)</span></span></figcaption></figure><p>Over <a href="https://www.nytimes.com/2018/01/22/us/politics/bonuses-tax-laws-trump-impact.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news">200 CEOs</a> have said they will raise wages or give bonuses as a result of the large corporate income tax cut passed late last year by Congress.</p>
<p><a href="https://www.huffingtonpost.com/entry/tax-cut-bonuses-corporate-pr-gop_us_5a3c1f2ae4b06d1621b3037a">Some</a> view their plans as simply a public relations move, <a href="http://fortune.com/2018/01/11/walmart-minimum-starting-wages-raises-bonuses/">others</a> as a response to tighter labor markets or worker pressures. <a href="https://hbr.org/2018/01/if-retailers-want-to-compete-with-amazon-they-should-use-their-tax-savings-to-raise-wages">Pretty much everyone hopes</a> that it might signal a new era in which corporate leaders share earnings with workers in ways <a href="https://www.usatoday.com/story/money/careers/changing-jobs/2017/11/15/pay-raises-survey-indicates-52-workers-didnt-get-one-past-year/864433001/">they have not done in the past</a>.</p>
<p>I’m among those who hold such a hope. Only if such profit sharing becomes the norm will the <a href="https://theconversation.com/its-time-we-reinvented-labor-for-the-21st-century-64775">long-term trends</a> in widening income inequality and wage stagnation be reversed. </p>
<p>But why should this decision be left to CEOs? Don’t workers have a legitimate claim and stake in what is done with the profits they help produce? New research I’ve been leading at MIT finally gives workers a voice on these issues and many others. </p>
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<h2>In search of a voice</h2>
<p>So far, apart from <a href="https://aflcio.org/2017/12/12/afl-cio-joins-cwa-call-4000-wage-increase-working-people">some statements</a> by <a href="https://www.nytimes.com/2017/11/23/us/politics/corporate-tax-cut-pay.html">union leaders</a>, the workforce itself has been silent about the new tax law – which among other things <a href="https://fivethirtyeight.com/features/the-gops-corporate-tax-cut-may-not-be-as-big-as-it-looks/">cut the corporate rate</a> to 21 percent from 35 percent – and how the extra money that will end up in corporate coffers should be spent. </p>
<p>Perhaps this is because, by and large, they have lost their voice at work as <a href="https://theconversation.com/the-rise-and-fall-of-us-labor-unions-and-why-they-still-matter-38263">unions have declined</a> and Wall Street’s voices <a href="https://hbr.org/2014/06/the-price-of-wall-streets-power">have ascended</a> and become more dominate in corporate decision making.</p>
<p>That’s one of the <a href="http://iwer.mit.edu/wp-content/uploads/2018/01/worker-voice-paper-1_16_18_tablesintext12pt.pdf">key findings of a study</a> we are conducting, which asks a nationally representative sample of American workers how much of a voice they feel they ought to have on workplace issues and the amount of say or influence they actually experience on their jobs. We found that there are large voice gaps across a range of worker concerns and that they are largest on basic economic issues of compensation and benefits, promotions and job security. </p>
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<p>For example, more than 90 percent said they should have at least “some say” on benefits and compensation, but most believe they have little or no say. Similarly, nearly three-quarters said they ought to have “a lot of say” or “unlimited say” concerning harassment protections, yet about two-thirds indicated they have some say or less. </p>
<p>Perhaps this is why 46 percent of all nonunion workers and half of the nonmanagerial nonunion workforce today would join one if given the opportunity, up from about a third for both groups in <a href="http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1026&context=books">previous decades</a>. This means 55 million members of the labor force would join the 14.8 million currently in a union if given the choice to do so today. </p>
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<p>Of course that’s not realistic since <a href="http://journals.sagepub.com/doi/abs/10.1177/001979390806200101">nine out of 10 union organizing efforts fail if management resists</a>, as managers nearly always do. But perhaps it is time to change this.</p>
<h2>5 worker priorities</h2>
<p>With that in mind, we asked the students and workers from around the world who have participated in our ongoing MIT online course “<a href="https://www.youtube.com/watch?v=zeRzs5iqxhM">Shaping the Future of Work</a>” to vote for their top priorities for how they want employers to contribute to a new social contract at work. </p>
<p>The idea behind this ongoing exercise is to find out what workers think business, labor, government and education leaders should do to build a more inclusive and productive economy and where they would allocate some of the tax cut dollars if they had the opportunity to do so. </p>
<p>Here is what our 2017 class identified as the top priority actions for employers. </p>
<ol>
<li><p><strong>Wages and benefits.</strong> Not surprisingly, consistent with the results of our worker survey, their top priority focused on compensation. Key elements of fair pay include a living wage, portable health insurance, some form of profit sharing and a voice on executive compensation. In essence, they are saying they ought to get their fair share because they helped generate the profits in the first place.</p></li>
<li><p><strong>Invest in training.</strong> Participants’ second-highest priority speaks to workers’ concerns for their future, particularly in the face of coming technological change. They want employers to invest in training for the full workforce – both regular workers and those in temporary or contract jobs – to keep their skills current so they are ready to put new technologies to work. They specifically want businesses to work with educational institutions and unions to support internships, lifelong learning, apprenticeships and online courses.</p></li>
<li><p><strong>Family leave policies.</strong> Concerned about the challenges meeting work and family responsibilities, participants said they want businesses to fill the void in national policy with respect to paid family and sick leave and make sure it’s available to people at all levels of the workforce. They also emphasized the importance of flexible work arrangements. </p></li>
<li><p><strong>“High-road” strategies.</strong> We also found a strong interest in forging better ways to take advantage of employee strengths by pushing companies to adopt so-called <a href="http://journals.sagepub.com/doi/abs/10.1177/0019793917738757">high-road strategies</a> that treat workers as assets and sources of knowledge. The aim is to get companies to better utilize their employees to improve operations and build modern, flexible, team-based work systems, which <a href="http://cepr.net/publications/reports/high-performance-work-practices-and-sustainable-economic-growth">research shows</a> boosts productivity. In other words, in exchange for demanding a greater share of the profits, workers are willing to give more to drive performance. </p></li>
<li><p><strong>Workplace respect.</strong> A final priority addresses a topic of <a href="https://www.theverge.com/2018/1/15/16893734/metoo-movement-backlash">considerable visibility today</a>: Workers want respect and to inhabit a workplace free of discrimination and harassment. And they suggest that the best way to achieve these goals is to establish workplace councils in which employees and managers work together to build and maintain a respectful workplace environment and to resolve problems or claims of harassment if and when they occur.</p></li>
</ol>
<h2>Finding a voice</h2>
<p>So how do we get there?</p>
<p>As I noted earlier, about half of employees who aren’t in a union would like to join one. Perhaps this is the place to start, by making it easier for them to join one. Beyond that, new ways of giving workers a voice, with mixed success, are also being developed by independent advocacy groups and online startups. </p>
<p><a href="https://home.coworker.org/">Coworker.org</a>, for example, helps workers file petitions with employers to change problematic workplace practices. <a href="https://www.glassdoor.com/index.htm">Glassdoor</a> allows people to rate good and bad employers. <a href="https://www.united4respect.org/splash?splash=1">OUR Walmart</a> uses artificial intelligence and machine learning to track the frequency of different worker complaints and then inform workers about their rights. And most recently <a href="https://www.npr.org/sections/monkeysee/2018/01/07/576036145/at-the-golden-globes-not-just-another-red-carpet">working women have been allying with movie stars</a> to demand a discrimination-free workplace via the burgeoning <a href="https://metoomvmt.org">MeToo movement</a>. </p>
<p>American workers are beginning to raise their voices again. CEOS, are you listening?</p><img src="https://counter.theconversation.com/content/90604/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Thomas Kochan receives funding from the Ford Foundation, the MIT Good Companies-Good Jobs Initiative, and the Mary Rowe Fund for Conflict Management</span></em></p>Although over 200 CEOs have promised to share windfalls from the recent tax cut with their employers – something the president is likely to bring up in the State of the Union – research suggests workers aren’t holding their breath.Thomas Kochan, Professor of Management, MIT Sloan School of ManagementLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/864302017-11-29T22:41:29Z2017-11-29T22:41:29ZTechnology will make today’s government obsolete and that’s good<p>Artificial intelligence is the hot topic of the moment. </p>
<p>The most valuable firms in the world, including Amazon, Microsoft and Google, are <a href="https://www.theguardian.com/science/2017/nov/02/big-tech-firms-google-ai-hiring-frenzy-brain-drain-uk-universities">in a race to hire leading AI researchers</a> to advance their efforts on autonomous vehicles, medical diagnostics and a range of other ventures. </p>
<p>At the same time, governments are rushing to support the technology that might drive the next economic paradigm shift with funding and incentives. </p>
<p>Prime Minister <a href="https://www.utoronto.ca/news/trudeau-gets-his-geek-u-t-talking-ai-and-canada-s-future">Justin Trudeau spoke to the promise of AI</a> at a conference recently, where he focused on the opportunity for Canada to attract investment and create jobs <a href="https://www.utoronto.ca/news/toronto-s-vector-institute-officially-launched">in the burgeoning field</a>. </p>
<p>But are governments inadvertently laying the groundwork for their own irrelevance?</p>
<p>As policy director at the University of Toronto’s Mowat Centre, I focus on the <a href="https://mowatcentre.ca/working-without-a-net/">impacts of technology</a> on the <a href="https://mowatcentre.ca/policymaking-for-the-sharing-economy/">labour market</a>, <a href="https://mowatcentre.ca/regulating-disruption/">government</a> services and <a href="https://www.brookings.edu/blog/techtank/2017/02/28/work-and-social-policy-in-the-age-of-artificial-intelligence/">social programs</a>. </p>
<h2>Industrial age government, information age world</h2>
<p>Already today, the private sector is deploying cutting-edge technology as soon as practicable while the public sector struggles to implement turn-of-the-century solutions to seemingly straightforward tasks.</p>
<p>The federal government’s ongoing travails with the Phoenix pay system upgrade, which was designed to save $70 million a year but <a href="http://www.cbc.ca/news/politics/phoenix-pay-system-pipsc-union-1.4402415">instead may cost $1 billion to fix</a>, is just the latest example of public sector challenges with large-scale information technology projects. </p>
<p>And the gap between the two worlds is likely to only get wider as technology — whether AI or <a href="https://theconversation.com/demystifying-the-blockchain-a-basic-user-guide-60226">blockchain</a> — becomes more advanced, complex and disruptive. The private sector’s capacity and ability to work with IT is already higher than the government’s. As salaries and opportunities continue to draw talent to the private sector, we’ll likely see a corresponding increase in the capability gap between the two. </p>
<p>Governments are already facing a crisis of trust. According to a <a href="https://www.edelman.com/trust2017/trust-in-canada/">survey by public relations consultancy Edelman, only 43 per cent of Canadians trust government</a>, the lowest among surveyed institutions. Just 26 per cent of Canadians surveyed view government officials and regulators as credible.</p>
<h2>Digital transformation crucial</h2>
<p>Citizens, increasingly accustomed to living and working digitally, are only going to have <a href="https://newsroom.accenture.com/news/canadian-citizens-want-to-be-consulted-by-government-to-determine-future-of-services-accenture-survey-finds.htm">higher expectations for government’s technological adeptness and capability</a> in the future. </p>
<p><a href="http://business.financialpost.com/news/fp-street/as-fintech-fears-fade-canadas-banks-look-to-next-big-thing-artificial-intelligence">Banks</a>, <a href="https://www.thestar.com/business/tech_news/2017/06/15/wave-of-automation-sweeping-canadian-retailers.html">retailers</a>, manufacturing firms and mines are all transforming themselves into digital organizations. </p>
<p>If our <a href="https://mowatcentre.ca/reprogramming-government-for-the-digital-era/">governments remain rooted in the industrial age</a>, their decline in relevance is only likely to accelerate. Most government structures and processes date back earlier than the 1950s. </p>
<p>This relevance gap won’t just be about accessing services more easily and effectively. In the near future we will likely see a debate about why public sector employees are relatively immune to job disruptions and precarious work conditions, while technology could accelerate both trends for those in the private sector.</p>
<p>As job quality continues to erode in the private sector, the public sector will appear to be apart from trends in precarious work. This will likely lead private sector workers to question why their taxes are funding well-paying, secure positions while they themselves may be struggling mightily.</p>
<h2>Labour disruption and unrest</h2>
<p>The future of work for many in the private sector will increasingly involve jumping from gig to part-time role and back again to make ends meet, with little left over to save for retirement or for “benefits” such as mental health services or prescription medications, labour market trends over the past 30 to 40 years suggest. </p>
<p>Part-time work is up 57 per cent over the past 40 years, and now accounts for nearly 20 per cent of jobs in Canada. Temporary work is also up 57 per cent over the past 20 years, and now forms 13.5 per cent of workforce. Across <a href="http://www.oecd.org/about/">OECD</a> countries, growth in non-standard work accounts for 60 per cent of job growth since the mid-1990s.</p>
<p>Those <a href="https://mowatcentre.ca/working-without-a-net/">employment trends are likely to get even worse</a> due to technology and corporate strategies. </p>
<p>In 2014, the <a href="http://www.statcan.gc.ca/pub/11-630-x/11-630-x2015005-eng.htm">public sector unionization rate was 71.3 per cent</a> — nearly five times the private-sector rate of 15.2 per cent, which raises hard questions about who will speak up for the private sector worker in an increasingly lean and fissured labour market.</p>
<h2>Mass unemployment</h2>
<p>A 2016 study by Deloitte and Oxford University found that up to <a href="https://www.theguardian.com/society/2016/oct/25/850000-public-sector-jobs-automated-2030-oxford-university-deloitte-study">850,000 jobs in the United Kingdom’s public sector could be lost as a result of automation by 2030</a>, in administrative roles as well as jobs for teachers and police officers. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/197038/original/file-20171129-12029-1wd4flh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Government public servants such as police could be replaced by automation within 15 years. A police robot responds to a dangerous criminal incident in this still from the 2015 film <em>Chappie</em>, written and directed by Neill Blomkamp.</span>
<span class="attribution"><span class="source">(Handout)</span></span>
</figcaption>
</figure>
<p>Merely applying these same projections to the Canadian public sector would mean over 500,000 jobs at risk out of 3.6 million public sector roles. But collective agreements could impede any attempts to pivot away from employees performing routine administrative tasks and towards workers with digital skills.</p>
<p>If the economy at large continues to wring efficiencies out of human labour and substitute technological approaches where possible, it becomes hard to imagine the public sector trundling along as it always has. </p>
<p>Quite simply, the public sector will need to develop a more efficient workforce and adopt more agile structures and strategies in order to maintain relevance in a digital world.</p>
<p>So, what’s the right path forward? While it’s promising to see governments and other public sector organizations move forward with digital service agendas, we can’t expect them to simply overlay digital solutions onto existing processes and reap the real benefits of technology. </p>
<h2>Blockchain, AI, virtual government</h2>
<p>The public sector, ranging from the core civil service to health care to education, must fundamentally transform how it operates. </p>
<p>Do we need countless contribution agreements, contracts and reimbursements to be physically vetted by clerks in multiple offices when blockchain technology could instantly verify all of those same transactions? </p>
<p>Do policy units need 30 advisers to prepare advice for government ministers, or can <a href="https://www.theguardian.com/technology/2017/jan/05/japanese-company-replaces-office-workers-artificial-intelligence-ai-fukoku-mutual-life-insurance">much of their work be done automatically</a> with a select few adding high-value insights? Can we employ telepresence to reach students in remote communities with high-quality teachers? Will medical diagnostics be <a href="https://www.newyorker.com/magazine/2017/04/03/ai-versus-md">transformed by neural networks</a> that can more accurately detect cancers and other diseases?</p>
<p>Countries like <a href="https://e-estonia.com/">Estonia</a>, widely regarded as the <a href="http://www.wired.co.uk/article/estonia-e-resident">most advanced digital society in the world</a>, demonstrate that it’s possible to rethink government as a digital platform. </p>
<p>Whether and how quickly Canada’s public sector can leverage technological advancements to radically increase the efficiency and effectiveness of programs and services will be perhaps its greatest challenge in the years to come. </p>
<p>Delays and missteps will only continue to put the public service further behind mainstream business and consumer trends, and risk a continued decline in relevance for our public institutions.</p><img src="https://counter.theconversation.com/content/86430/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sunil Johal does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Government is about to be disrupted by technology in the same manner as major industries. It’s about time.Sunil Johal, Policy Director, The Mowat Centre, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/836662017-09-13T08:41:36Z2017-09-13T08:41:36ZFact Check: does immigration have an impact on wages or employment?<figure><img src="https://images.theconversation.com/files/185305/original/file-20170908-32276-xae7cu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Is the jobs glass half full or half empty?</span> <span class="attribution"><span class="source">via shutterstock.com</span></span></figcaption></figure><blockquote>
<p>When I was business secretary there were up to nine studies that we looked at that took in all the academic evidence. It showed that immigration had very little impact on wages or employment. But this was suppressed by the Home Office under Theresa May, because the results were inconvenient.</p>
</blockquote>
<p><strong>Vince Cable, leader of the Liberal Democrats, in a <a href="https://www.theguardian.com/politics/blog/live/2017/sep/06/pmqs-home-office-immigration-leak-reaction-politics-live?page=with:block-59afcd61e4b066447a05c3bf#block-59afcd61e4b066447a05c3bf">statement</a> on September 6.</strong></p>
<blockquote>
<p>There is quite a lot of evidence that if we have too many low-skilled workers coming in, one of the effects is to depress the wages of those at the bottom end of the wage scale.</p>
</blockquote>
<p><strong>Damian Green, first secretary of state and minister for the Cabinet Office, <a href="http://www.bbc.co.uk/programmes/b092jw7q">speaking</a> on BBC Radio 4’s Today programme on September 7.</strong></p>
<p>The effect of immigration on wages and employment has been the subject of <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=10">numerous studies</a>, both <a href="http://www.migrationobservatory.ox.ac.uk/resources/briefings/the-labour-market-effects-of-immigration/">in the UK</a> and <a href="http://www.ucl.ac.uk/%7Euctpb21/doc/CDP_11_08.pdf">internationally</a>. Research for the UK points to no convincingly large negative effects of immigration on <a href="http://cep.lse.ac.uk/pubs/download/pa015.pdf#page=10">average wages</a> of <a href="http://www.cream-migration.org/publ_uploads/CDP_08_06.pdf">British-born workers</a>. This is largely in line with the <a href="http://www.nber.org/papers/w16736.pdf#page=12">predominant</a> (though not <a href="https://www.economist.com/blogs/freeexchange/2017/06/immigration-economics">uncontroversial</a>) finding of studies done in other countries.</p>
<p><a href="http://www.bankofengland.co.uk/research/Documents/workingpapers/2015/swp574.pdf">Some studies</a> have pointed to the possibility of effects on the <a href="http://www.ucl.ac.uk/%7Euctpb21/Cpapers/CDP_03_08.pdf">distribution of wages</a>, holding wage growth back at the lower end and pushing wages up at the higher end. However, authors of studies which have suggested this have emphasised that the negative effects are <a href="http://www.independent.co.uk/news/business/news/impact-of-immigration-on-native-wages-infinitesimally-small-a7545196.html">small</a>. While recent immigrants as a whole have typically been <a href="http://cep.lse.ac.uk/pubs/download/pa015.pdf#page=6">highly qualified</a> relative to the skill level of the UK labour force, the location of such effects may have to do with the fact that they tend to work initially in <a href="https://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/">lower paid jobs</a>.</p>
<p>Evidence for harmful effects of immigration on employment is <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/287287/occ109.pdf">also slim</a>. Most studies have failed to find <a href="http://www.ucl.ac.uk/%7Euctpb21/Cpapers/ecoj_1038.pdf">clear evidence</a> of <a href="https://www.niesr.ac.uk/sites/default/files/publications/090112_163827.pdf">a link</a>.</p>
<p>One exception, <a href="http://www.telegraph.co.uk/news/2017/08/24/debate-immigration-britain-puts-gdp-ahead-people/">sometimes cited</a> by advocates of tighter immigration policy, is a 2012 Migration Advisory Committee <a href="http://cream-migration.org/files/MAC_report_jan2012.pdf">report</a> that found some association in particular of non-EU migration with employment of non-immigrants during one period of downturn, though the study itself emphasises that <a href="http://creamcomments.blogspot.co.uk/2012/01/16th-january-2012-some-thoughts-on.html">the evidence</a> is <a href="http://cream-migration.org/files/MAC_report_jan2012.pdf#page=124">not very robust</a>.</p>
<p>Overall the Migration Advisory Committee itself <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/333083/MAC-Migrants_in_low-skilled_work__Full_report_2014.pdf#page=289">concluded</a>: “Evidence to date suggests little effect on employment and unemployment of UK-born workers, but that wages for the low paid may be lowered as a result of migration, although again this effect is modest.”</p>
<h2>Impervious political debate</h2>
<p>Despite the weak evidence, harmful labour market effects continue to be emphasised in political debate, for example by Theresa May both when she was <a href="https://theconversation.com/fact-check-is-there-zero-economic-benefit-from-high-immigration-48704">home secretary</a> and now as <a href="https://www.theguardian.com/politics/2017/sep/08/vince-cable-urges-pm-to-lift-lid-on-eu-immigration-reports">prime minister</a>. (The same is true <a href="https://www.bloomberg.com/view/articles/2017-09-06/don-t-believe-what-jeff-sessions-said-about-jobs">in the US</a>). </p>
<p>Some may feel it is obvious that the expansion of labour supply that follows from immigration must harm competing workers. But this ignores the many ways in which immigration can also lead to expanded labour demand – through immigrants’ spending on goods produced locally, through the complementary skills they bring into the country, through encouraging changes in the pattern of production or encouraging inflow of capital, and so on. For all of these reasons, it is quite compatible with standard economic theory to find that immigration might have <a href="https://www.ft.com/content/0deacb52-178b-11e6-9d98-00386a18e39d">little or no effect</a> on wages or employment. </p>
<h2>Verdict</h2>
<p>Vince Cable’s understanding of the preponderance of academic evidence on the labour market effects of immigration is accurate. There is little persuasive evidence that immigration has substantial harmful effects on average UK wages or employment. Damian Green is correct to identify effects on the least well paid as being of greatest concern but evidence suggests these effects are not large. </p>
<h2>Review</h2>
<p><strong>Jonathan Wadsworth, professor of economics at Royal Holloway, University of London</strong></p>
<p>According to standard economic textbooks, the purported effects of immigration on the existing workforce are undoubtedly negative – like the minimum wage. How so when the academic evidence – as accurately outlined in this fact check – does indeed suggest that, contrary to standard texts, immigration does not have any large significant effect on employment either in aggregate or among groups supposedly most at risk? Nor does immigration appear to depress wages of native-born Britons much. The recently resurrected <a href="http://www.bankofengland.co.uk/research/Documents/workingpapers/2015/swp574.pdf">study</a>, cited by politicians and the media could not determine whether its findings of a small negative wage effect apply to UK-born people or immigrants or both. </p>
<p>Politicians and the media making disingenuous, selective or, at best, misinformed interpretations of academic studies do not help. There is also a lot of dross out there and sifting through it is not always easy, for anyone, politicians and the media included. Ultimately, continued dialogue and engagement between academia and the outside world can only help understanding and inform policy making.</p>
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<p><em>The Conversation is checking claims made by public figures and prominent commentators in public debates. Statements are checked by an academic with expertise in the area. A second academic expert then reviews an anonymous copy of the article. Please get in touch if you spot a claim you would like us to check by emailing us at uk-factcheck@theconversation.com. Please include the statement you would like us to check, the date it was made, and a link if possible.</em></p><img src="https://counter.theconversation.com/content/83666/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ian Preston has been part of teams receiving funding from the Home Office, Migration Advisory Committee and Low Pay Commission for past research on migration.</span></em></p><p class="fine-print"><em><span>Jonathan Wadsworth was on The Migration Advisory Committee from 2007- 2016 and has been on the NHS Pay Review Board from 2016 to the present. </span></em></p>Liberal Democrat leader Vince Cable claims there is no evidence that immigration impacts wages. Is he right?Ian Preston, Professor in the Department of Economics, UCLLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/822702017-09-05T20:06:03Z2017-09-05T20:06:03ZExplainer: how international competition affects how much you earn<p><em>Low wages growth has been a spectre hanging around the Australian economy for some time. In our series <a href="https://theconversation.com/au/topics/what-we-earn-42620">What We Earn</a> we unpick the causes for this and why some workers might be feeling it more than others.</em></p>
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<p>The slump in wage growth is not just an Australian phenomenon – wage growth in most advanced economies has been <a href="https://www.rba.gov.au/publications/bulletin/2015/jun/pdf/bu-0615-2.pdf">lower than expected</a> in recent years. This is because globalisation has put us all in the same boat when it comes to <a href="http://www.rba.gov.au/publications/bulletin/2015/jun/2.html">international competition</a>.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=453&fit=crop&dpr=1 600w, https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=453&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=453&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=569&fit=crop&dpr=1 754w, https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=569&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/181759/original/file-20170811-1159-x9ug1r.gif?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=569&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Earnings per hour.</span>
</figcaption>
</figure>
<p>There are two ways that international competition can reduce wages - imported goods and migrant workers. </p>
<p>In Australia, import prices of both items purchased by households and goods used in manufacturing, purchased by businesses, have <a href="http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6457.0Jun%202017?OpenDocument">fallen over the past two years</a>. This means businesses in Australia are increasingly competing with imports. As a result these businesses are less able to afford wage increases and their workers are less likely to ask for them, in fear that they may lose their jobs.</p>
<p>Low import prices are usually due to the goods we import (think t-shirts from Bangladesh, hardware products from China). Our imports, particularly of manufactured goods, are coming increasingly from countries where labour is plentiful and cheap, according to <a href="https://industry.gov.au/Office-of-the-Chief-Economist/Research-Papers/Documents/2015-Research-Paper-2-Impact-of-international-trade-on-employment.pdf">research</a>. </p>
<p>In fact about half of our manufactured imports come from low-wage countries, which is an increase from less than 10%, 40 years ago. This is important when we consider that <a href="https://industry.gov.au/Office-of-the-Chief-Economist/Research-Papers/Documents/2015-Research-Paper-2-Impact-of-international-trade-on-employment.pdf">80%</a> of the value of Australia’s imports comes from manufactured goods.</p>
<p>When we import cheap products we are effectively importing cheap labour. This effective boost to the supply of cheap labour drives down import prices and wages in Australia. A similar effect happens when businesses outsource products or services to another country. </p>
<p>Again this is a global phenomenon affecting all industrialised countries including <a href="http://www.frbsf.org/economic-research/files/wp2013-27.pdf">the US</a> and <a href="https://theconversation.com/more-offshoring-of-australian-jobs-can-you-bank-on-it-5214">Australia</a>. The most common primary motivation for global outsourcing <a href="https://www2.deloitte.com/content/dam/Deloitte/nl/Documents/operations/deloitte-nl-s&o-global-outsourcing-survey.pdf">cited</a> by companies is cost cutting. Business functions that are <a href="https://www2.deloitte.com/content/dam/Deloitte/nl/Documents/operations/deloitte-nl-s&o-global-outsourcing-survey.pdf">typically</a> outsourced are manufacturing procurement and services such as information technology, legal, facilities management, finance and human resources.</p>
<p>International competition can also reduce wages through migration of labour to Australia, although here the empirical evidence is less clear. The effect of migration on wages depends whether it creates enough jobs to absorb the extra workers, but teasing this out is not straightforward.</p>
<p>Net overseas migration has increased as a share of the population from <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1617/Quick_Guides/MigrationStatistics">47% in 2000</a> to 54% in 2015. And the skilled migrant share of permanent migrants has increased from <a href="http://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1617/Quick_Guides/MigrationStatistics">55% in 2000</a> to 68% in 2015. Not only are migrants increasing as a share of the population, but a higher share of them are skilled.</p>
<p>And their labour participation rates are high. In November 2016 the labour force participation rate for recent migrants and temporary residents combined <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6250.0">was at 70%,</a> which is higher than the overall participation rate for Australia of 66%. The effect is to boost the overall Australian labour participation rate. </p>
<p>Importantly, recent migrants have higher skill levels <a href="http://www.pc.gov.au/inquiries/completed/migration-population/report/migrationandpopulation.pdf">than others in the labour force</a>. Unless sufficient extra jobs are created to absorb these extra workers, wages could go down, and more so in skilled wages relative to unskilled wages.</p>
<p>However this effect on job creation is hard to pin down and so research shows the effect on wages could go either way. </p>
<p>One <a href="https://sites.hks.harvard.edu/fs/gborjas/publications/journal/JEL2015.pdf">US study</a> argues that the additional jobs created are not enough to absorb the extra workforce, creating slack in the labour market and a drop in wages. However, <a href="http://users.monash.edu/%7Easaduli/pub/ER1.pdf">another study</a> using Australian data shows an increase in wages with increased immigrant worker numbers but it’s small and statistically insignificant. Another Australian <a href="https://theconversation.com/new-research-shows-immigration-has-only-a-minor-effect-on-wages-74546">study</a> found no net impact at all. </p>
<p>The question turns mainly on the net effect of migration on the quantity and quality of nation’s investment in things like buildings, equipment and the like that are used by businesses. If this is sufficiently strong, then the workforce will be more productive and wages will tend to rise, otherwise they will fall. </p>
<p>So while it’s easy to calculate the extra workers from migration, it is much <a href="http://www.pc.gov.au/inquiries/completed/migration-population/report/migrationandpopulation.pdf">harder</a> to calculate the effect they will have on business investment and therefore on wages.</p>
<p>Globalisation has increased international competition through imports of both goods and labour. Imports of goods have tend to depress wage growth in Australia. The effect of labour imports through migration on wage growth depends on whether the boost to the workforce dominates any boost to job creation and that’s unclear in theory and evidence.</p><img src="https://counter.theconversation.com/content/82270/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ross Guest has previously received funding from the ARC and is a member of the ARC College of Experts.</span></em></p>There are two ways that international competition can reduce wages. Both are effects of globalisation.Ross Guest, Professor of Economics and National Senior Teaching Fellow, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/819992017-09-04T20:11:55Z2017-09-04T20:11:55ZWhy Australian CEOs are sharing part of our wages pain<p><em>Low wages growth has been a spectre hanging around the Australian economy for some time. In our series <a href="https://theconversation.com/au/topics/what-we-earn-42620">What We Earn</a> we unpick the causes for this and why some workers might be feeling it more than others.</em></p>
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<p>Even though shares and bonuses for CEOs have been fluctuating over the years, recently CEO salaries have remained stagnant. This trend lines up with the stagnant wages workers <a href="https://www.google.com.au/url?sa=t&rct=j&q=&esrc=s&source=web&cd=5&ved=0ahUKEwiqtJ7Ng9jVAhVDUbwKHTPPBMkQFgg9MAQ&url=https%3A%2F%2Fwww.rba.gov.au%2Fpublications%2Fbulletin%2F2017%2Fmar%2Fpdf%2Fbu-0317-2-insights-into-low-wage-growth-in-australia.pdf&usg=AFQjCNFV0AsGOp94cfJn301kpQjCB4f2y">have been experiencing across the board</a>.</p>
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<p>I calculated the average CEO salary, bonus and remuneration for a sample of ASX100 firms, for the period 2012-2016. I only included firms with available data for the same CEO for the entire five year period, which was 45 of the 100.</p>
<p>Looking just at the salary component of remuneration, it’s clear CEO salaries plateaued across 2016 and 2015 with modest increases of 2.31% and 3.15% respectively. In contrast, CEO salaries increased by 7.54% and 8.53% in 2014 and 2013, well above the growth in average Australian wages. CEO salaries as a multiple of average Australian wages show a small but steady increase over the five-year period. </p>
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<p>However CEO bonuses and share-based payments show a different story. Bonus payments were much more volatile across 2012-2016. </p>
<p>CEO bonuses are usually payments based on <a href="http://www.sciencedirect.com.ezproxy.library.uq.edu.au/science/article/pii/S1573446399300249/pdf?md5=f3d68f03169320b774cea3da861d1f0b&isDTMRedir=Y&pid=1-s2.0-S1573446399300249-main.pdf">short-term performance</a>. This explains their volatility across 2012-2016; the large increase in average bonus payments in some years and the large negative change for 2016.</p>
<p>Share-based payments are usually calculated with a standard accounting method and reflect the amount of shares a CEO owns during a year, rather than the money those shares earn during that period. </p>
<p>There’s been large increases in share-based remuneration awarded to CEOs in every year except 2014.</p>
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<p>Share-based payments are also usually linked to the company’s <a href="http://www.sciencedirect.com.ezproxy.library.uq.edu.au/science/article/pii/S1573446399300249/pdf?md5=f3d68f03169320b774cea3da861d1f0b&isDTMRedir=Y&pid=1-s2.0-S1573446399300249-main.pdf">share performance</a> and so its value is subject to changes in both the individual business and the whole capital market. </p>
<p>Overall the data shows that growth in total CEO pay has outstripped average Australian wage growth in every year of the last five years. But perhaps we need to look more closely.</p>
<h2>CEO pay and average wages</h2>
<p>CEO pay is made up of a base salary component plus a mix of elements that are subject to fluctuation. These parts of the executive pay packet are influenced by <a href="https://espace.library.uq.edu.au/view/UQ:252035">many factors</a> including firm size and complexity, individual company performance, internal benchmarks, share market performance, industry norms and the domestic and international economy. So many of the factors influencing low wages growth for Australian workers are also an important influence on CEO pay, although not necessarily in the same way. </p>
<p>For example, low wages growth has helped to <a href="https://www.rba.gov.au/publications/bulletin/2015/jun/pdf/bu-0615-2.pdf">moderate growth in labour costs for firms</a> and so improving profitability. However, low wages growth <a href="https://www.rba.gov.au/publications/bulletin/2015/jun/pdf/bu-0615-2.pdf">has also been linked</a> to higher unemployment levels, under-capacity in the economy, low consumer expectations about inflation and Australia’s weakening terms of trade. All of these factors will ultimately impact negatively on the profitability of individual businesses and it’s difficult to justify a large increase in CEO base salary if the firm is not performing well. </p>
<p>On the basis of the data provided, it’s reasonable to predict there will be a continued plateauing of CEO base pay and that any increase will, on average, be roughly in line with Australian wages growth. The other elements of CEO pay are much more unpredictable. Certainly if business performance slows, so will the amount of elements of executive remuneration that are variable because they are linked to performance.</p>
<p>Public scrutiny of executive pay and shareholder’s ability to vote against it with <a href="https://theconversation.com/au/topics/two-strikes-law-1721">Australia’s two-strikes rule</a> are also likely to moderate executive pay in the future. Pay levels well above industry norms or individual performance will continue to draw <a href="https://theconversation.com/australia-is-ripe-for-shareholder-activism-69422">shareholder ire</a> and a <a href="http://www.afr.com/business/banking-and-finance/cba-kills-shortterm-bonuses-for-ian-narev-top-executives-20170807-gxrd2d">swift board reaction</a>.</p><img src="https://counter.theconversation.com/content/81999/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Julie Walker is affiliated with Chartered Accountants Australia New Zealand. </span></em></p>Data shows that growth in total CEO pay has outstripped average Australian wage growth in every year of the last five years. But perhaps we need to look more closely.Julie Walker, Associate Professor in Accounting, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/822072017-09-03T20:09:53Z2017-09-03T20:09:53ZThe costs of a casual job are now outweighing any pay benefits<p><em>Low wages growth has been a spectre hanging around the Australian economy for some time. In our series <a href="https://theconversation.com/au/topics/what-we-earn-42620">What We Earn</a> we unpick the causes for this and why some workers might be feeling it more than others.</em></p>
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<p>Workers aren’t being compensated as much as they should be for precarious work in casual positions. </p>
<p>One in four Australian employees today <a href="http://www.abs.gov.au/AUSSTATS/abs@.nsf/productsbyCatalogue/A8CAED8E5F9FB2E1CA257F1F00044E8C?OpenDocument">is a casual worker</a>. Among younger workers (15-24 year olds) the numbers are <a href="https://www.blackincbooks.com.au/books/generation-less">higher still</a>: more than half of them are casuals.</p>
<p>These jobs come without some of the benefits of permanent employment, such as paid annual holiday leave and sick leave. In exchange for giving up these entitlements, casual workers are supposed to receive a higher hourly rate of pay – known as a casual “loading”. </p>
<p>But the costs of casual work are now outweighing the benefits in wages.</p>
<h2>Costs and benefits of casual work</h2>
<p>Casual jobs offer flexibility, but also come with costs. For workers, apart from missing out on paid leave, there are other compromises: less predictable working hours and earnings, and the prospect of dismissal without notice. Uncertainty about their future employment can hinder casual workers in other ways, such as making family arrangements, getting a mortgage, and juggling education with work. </p>
<p>Not surprisingly, casual workers have lower expectations about keeping their current job. For example the <a href="http://www.abs.gov.au/AUSSTATS/subscriber.nsf/log?openagent&63330do006_201608.xls&6333.0&Data%20Cubes&A1DD74CD01213D99CA25811300187349&0&August%202016&02.05.2017&Latest">Australian Bureau of Statistics</a> (ABS) found 19% expect to leave their job within 12 months, compared to 7% of other workers. Casuals are also <a href="http://hdl.handle.net/2328/26203">much less likely to get work-related training</a>, which limits their opportunities for skills development.</p>
<p>The employers of casual workers also face higher costs. High staff turnover adds to recruitment costs. But perhaps the main cost is the “loading” that casual workers are supposed to be paid on top of their ordinary hourly wage. </p>
<p>Australia’s system of minimum wage awards <a href="https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/minimum-wages">specifies a casual loading of 25%</a>. So, a casual worker paid under an award should get 25% more for each hour than another worker doing the same job on a permanent basis. In enterprise agreements, the casual loading varies by sector, but <a href="https://www.australianunions.org.au/casual_workers_factsheet">tends to be between 15 and 25%</a>.</p>
<p>The practice of paying a casual loading developed for two reasons. One was to provide some compensation for workers missing out on paid leave. The other, quite different, motivation was to make casual employment more expensive and discourage excessive use of it. However this disincentive has not prevented the casual sector of the workforce from growing substantially.</p>
<h2>Casual jobs aren’t much better paid</h2>
<p>One approach in determining whether casual workers are paid more is simply to compare the hourly wages of casual and “non-casual” (permanent and fixed-term) employees in the same occupations. This can be done using data from the 2016 ABS <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6306.0/">Survey of Employee Earnings and Hours</a>. </p>
<p>We compared median hourly wages for adult non-managerial employees, based on their ordinary earnings and hours of work (i.e. excluding overtime payments). If the median wage for casuals is higher than for non-casuals, there is a casual premium. If the median casual wage is lower, there is a penalty.</p>
<p>The 10 occupations below accounted for over half of all adult casual workers in 2016. In most of these occupations, there is a modest casual wage premium - in the order of 4-5%.</p>
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<p>The size of the typical casual wage premium is much smaller, in most cases, than the loadings written into awards and agreements. Only one occupation (school teachers) has a premium (22%) in line with what might be expected.</p>
<p>Three of the 10 largest casual occupations actually penalise this sort of work. And overall for these 10 occupations there is a casual wage penalty of 5%. This method of analysis suggests that few casual workers enjoy substantially higher wages as a trade-off for paid leave.</p>
<p>Taking a closer look involves controlling for a wider range of differences between casual and non-casual workers. <a href="https://doi.org/10.1111/j.1472-9296.2005.00181.x">One major Australian study</a> in 2005 compared wages after taking account of many factors other than occupation, including age, education, job location, and employer size. </p>
<p>All else equal, it found that part-time, casual workers do receive an hourly wage premium over full-time, permanent workers. The premium is worth around 10%, on average, for men and between 4 and 7% for women.</p>
<p>These results imply that most casual workers (who are in part-time positions) can expect to receive higher hourly wages than comparable employees in full-time, permanent positions. However, the value of the benefit is again found to be less than would be expected, given the larger casual loadings mentioned in awards and agreements. </p>
<p>It seems that while there is <em>some</em> short-term financial benefit to being a casual worker, this advantage is worth less in practice than on paper.</p>
<p><a href="https://doi.org/10.1177/0018726716686666">A recent study</a>, using 14 years of data from the Household, Income and Labour Dynamics in Australia Survey (HILDA), finds no evidence of any <em>long-term</em> pay benefit for casual workers. </p>
<p>The study’s authors estimate that, among men, there is an average casual wage penalty of 10% - the opposite of what we should see if casual loadings fully offset the foregone leave and insecurity of casual jobs. Among female casual workers, there is also a wage penalty, but this is smaller, at around 4%. </p>
<p>This study also finds that the size of the negative casual wage effect tends to reduce over time for individual workers, bringing them closer to equality with permanent workers. But very few casual workers out-earn permanent workers in the long-term.</p>
<h2>Inferior jobs, but fewer alternatives</h2>
<p>The evidence on hourly wage differences leads us to conclude that casual workers are not being adequately compensated for the lack of paid leave, or for other forms of insecurity they face. This makes casual jobs a less appealing option for workers.</p>
<p>This does not mean that all casual workers dislike their jobs – <a href="https://doi.org/10.1111/j.0022-1856.2004.00142.x">indeed, many are satisfied</a>. But a clear-eyed look at what these jobs pay suggests their benefits are skewed in favour of employers.</p>
<p>Despite this, the choice for many workers - especially young jobseekers - is increasingly between a casual job or no job at all. Half of employed 15-24 year olds are in casual jobs. </p>
<p>In a labour market characterised by <a href="https://doi.org/10.1177/0022185616634716">high underemployment</a> and <a href="https://theconversation.com/graduating-into-a-weak-job-market-why-so-many-grads-cant-find-work-45222">intensifying job competition</a>, young people with little or no work experience are understandably willing to make some sacrifices to get a start in the workforce. The option of “holding out” for a permanent job looks increasingly risky as these opportunities dwindle.</p><img src="https://counter.theconversation.com/content/82207/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniel Nicholson is affiliated with the Australian Labor Party and progressive think tank the John Cain Foundation. </span></em></p><p class="fine-print"><em><span>Josh Healy does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The costs of casual work are now outweighing the slim benefits in wages (and even those are not as much as they used to be).Josh Healy, Senior Research Fellow, Centre for Workplace Leadership, The University of MelbourneDaniel Nicholson, Research Assistant, Industrial Relations, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/805922017-07-11T15:08:26Z2017-07-11T15:08:26ZJeff Bezos has asked for charitable giving advice –
here’s what he should do with his money<p>Jeff Bezos – the billionaire founder of Amazon with a net worth of over <a href="https://www.forbes.com/profile/jeff-bezos/">US$80 billion</a> – has <a href="https://twitter.com/JeffBezos/status/875418348598603776">asked Twitter</a> for advice on how to donate to charity.</p>
<p>The responses came quick. At the time of writing, there were more than 45,000 replies. Bezos must have expected it; his announcement hints at a once-in-a-generation gift of wealth.</p>
<p>Giving away money can be surprisingly hard to do. There is a <a href="https://www.cafonline.org/docs/default-source/about-us-publications/future_world_giving_report_250212.pdf?sfvrsn=373ef440_5">large</a> philanthropy industry in the world, and that industry is certainly not free from controversy. </p>
<p>There are <a href="http://www.sciencedirect.com/science/article/pii/S0263786316301855">some</a> eye-watering tales of bad planning, such as the now infamous <a href="https://www.gsb.stanford.edu/sites/gsb/files/publication-pdf/playpumps-gaininguserbuy-in.pdf">PlayPump scheme</a>, which sought funds for a scheme providing merry-go-rounds connected to bore holes. Children were supposed to play on the ride and so provide power to pump up water.</p>
<p>Despite tens of millions of dollars in funding for PlayPump, it turned out that “playing” on the wheel was hard and not particularly enjoyable. The charity WaterAid <a href="http://objectsindevelopment.net/wp-content/uploads/2011/04/wateraid_letter_playpumps.pdf">reported</a> that adults were left to turn it by hand, lumbered with an expensive and <a href="https://www-tc.pbs.org/frontlineworld/stories/southernafrica904/flash/pdf/unicef_pp_report.pdf">inefficient</a> type of pump.</p>
<p>But criticism of philanthropy can go far deeper than just highlighting wasteful schemes like PlayPump. At its worst, charity is said to <a href="https://www.youtube.com/watch?v=hpAMbpQ8J7g">distract us</a> from the root causes of need. That is, lack of access to <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1467-9957.2011.02230.x/full">well-paid work</a>. Or as <a href="https://archive.org/details/soulmanundersoc01wildgoog">Oscar Wilde</a> put it: “… remedies do not cure the disease; they merely prolong it.”</p>
<p>With these issues in mind, here is some advice for Bezos.</p>
<h2>Read the replies</h2>
<p>Having asked for them, Bezos will have to analyse the vast number of replies on Twitter. There is a great range of ideas vying for attention and money. Some are imaginative. For example <a href="https://twitter.com/carsjam33/status/878634660280111111">one</a> user calls for a fund to help stranded seafarers get back home. <a href="https://twitter.com/JRFuller321/status/878987755757416449">Another</a> suggests using drones as first responders in medical emergencies. </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"876109682104033281"}"></div></p>
<p>Even Madonna, the <a href="http://www.historynet.com/how-famous-was-madonna.htm">world famous</a> popstar, joined the debate. She is a graduate of Rochester Adams High School, about 30 miles north of Detroit, and so she invited Bezos on a trip with her to the Motor City, hash-tagging her <a href="https://twitter.com/Madonna/status/876109682104033281/photo/1">Twitter reply</a> with charities in the area.</p>
<p>Many of the replies are straightforward reminders of poverty and global hunger. And it is when we think about <a href="http://www.earth.columbia.edu/articles/view/1780">urgent need</a> that we start to really focus our minds on how to do the most good with the money we have to donate.</p>
<p>In light of this, there is one Twitter responder who is worthy of particular attention. <a href="http://www.petersinger.info/about/">Peter Singer</a>, the well-known moral philosopher, also threw himself into the fray, <a href="https://twitter.com/PeterSinger/status/878957578343989252">offering</a> – like Madonna – to personally interact with Bezos. Singer is <a href="https://www.effectivealtruism.org/peter-singer-ted/">the founder</a> of the “<a href="https://theconversation.com/five-ways-to-become-a-really-effective-altruist-53684">effective altruism</a>” movement. He contends that we – all of us with a disposable income – have a so-called “duty of easy rescue”. </p>
<p>He <a href="http://www.jstor.org/stable/2265052?seq=1#page_scan_tab_contents">famously argues</a> that in circumstances of crisis, we are morally bound to donate – to intervene – in precisely the same way we might be morally obliged to rescue a hypothetical child we discovered drowning in a shallow pond. Because the cost of rescue is so small to anyone with disposable income, and the reward for the recipient can be so enormously high, everyone is constantly morally bound to help out in the most useful way possible. They should give money. And, Singer argues, they should give it to causes where it will have the most impact.</p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"875418348598603776"}"></div></p>
<p>Bezos has a staggeringly large amount of money at his disposal. He can do a lot more than most. He also says on Twitter that he wants to make an immediate difference with his philanthropy, in the “here and now”. Following Singer, a good place to start would be to look at impact in relation to need, and target his money where that impact is greatest. And there are websites such as <a href="https://www.thelifeyoucansave.org/Where-to-Donate/Selection-Methodology">The Life You can Save</a> and <a href="http://www.givewell.org/">Give Well</a> that make this easy for Bezos (or anyone else looking to give effectively), which outline how effective different charities are, based on different criteria. </p>
<h2>Charity starts at home</h2>
<p>There is some more difficult advice to give Bezos. It is reasonable to ask him how he has come to be in a position of such <a href="http://www.nytimes.com/images/2015/08/16/nytfrontpage/scan.pdf">enormous power</a> in the first place. After all, he is one of the eight people that <a href="http://www.oxfam.org.uk/media-centre/press-releases/2017/01/eight-people-own-same-wealth-as-half-the-world">Oxfam estimate</a> own the same wealth as the bottom half of the world population combined.</p>
<p>That money mostly comes from labour hours. Despite his undoubted entrepreneurial talent, at root he makes a profit from the <a href="https://link.springer.com/chapter/10.1007/978-1-349-26121-5_15">time of others</a>. That is the nature of commerce: Amazon famously employs large numbers of agency staff and questions have been asked <a href="https://www.theguardian.com/technology/2013/dec/01/week-amazon-insider-feature-treatment-employees-work">about their treatment</a>. Like all profit-seeking companies, Amazon <a href="https://link.springer.com/chapter/10.1007/978-1-4020-7953-5_15">is concerned with profit margins</a>.</p>
<p>This brings things full circle – to Wilde’s comment that charity should not blind us to the root causes of poverty. It is difficult to think of a more intuitive way for Bezos to improve the world than <a href="http://strongerunions.org/2015/04/15/what-working-for-amazon-really-does-to-your-health-the-truth-is-starting-to-come-out/">paying his workers well</a>, while also ensuring that everyone in Amazon’s enormous global supply chain can make ends meet.</p><img src="https://counter.theconversation.com/content/80592/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Picton does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>An expert in the charity sector responds to Jeff Bezos’s request for advice on how to give his money away.John Picton, Lecturer in Charity Law, University of LiverpoolLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/797562017-06-22T20:04:42Z2017-06-22T20:04:42ZHow to ask for a pay rise<figure><img src="https://images.theconversation.com/files/175152/original/file-20170622-3049-1pgpsne.jpg?ixlib=rb-1.1.0&rect=1%2C56%2C998%2C473&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Despite what RBA chief Philip Lowe says, asking for a pay rise isn't so simple for many employees. </span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>When Reserve Bank governor <a href="http://www.rba.gov.au/speeches/2017/sp-gov-2017-06-19.html">Philip Lowe argued that the real source</a> of workers’ unhappiness was an unwillingness to lobby for higher wages, he overlooked a key tenet of negotiation: we negotiate most successfully when we have highly valued (and scarce) skills. </p>
<p>Negotiation is all about who has the power. If your skills are not in high demand or are readily found elsewhere, you have less power. It would be unrealistic, for example, to suggest a secondary school student working on an hourly rate, or a semi-skilled factory worker whose industry is in decline, is able to negotiate higher wages. </p>
<p>To assert, as Lowe has, that the low jobless rate should encourage workers to ask for higher wages ignores the possibility that the jobless rate is not evenly distributed across sectors. You would only know who had the power to negotiate if you found out where the demand for skills was, sector-by-sector. </p>
<p>If you have skills in high demand, you should be able to negotiate a personalised employment contract that offers you a mix of economic and other benefits based on your skills. Much of the advice about renegotiating employment contracts is aimed at people who have skills to offer. </p>
<p>You can make your case for a pay rise by highlighting your unique skills and contributions to the organisation. You should provide a well-reasoned case for increased wages and explore some non-economic ways to enhance your overall remuneration package. A caveat on this approach is that it works better for men than for women, who violate the <a href="http://journals.sagepub.com/doi/pdf/10.1177/0149206311431307">stereotype-based expectations</a> that they display warmth and concern when they ask.</p>
<p>However, if your skills are the type that’s found elsewhere, a different strategy is called for. The traditional advice is to build your negotiating power by identifying alternative options, so you’re less dependent on your current employer. </p>
<p>The risk with this is your employer may decide they also have many alternatives and may be willing to lose an employee who asks for a wage increase. So the usual advice for these employees is to build alliances to strengthen their position – in short, <a href="https://theconversation.com/au/topics/collective-bargaining-9125">collective bargaining</a>. </p>
<h2>The big ask</h2>
<p><a href="https://hbr.org/2015/11/be-your-own-best-advocate;%20https://hbr.org/2014/04/15-rules-for-negotiating-a-job-offer;%20https://hbr.org/2016/06/how-to-negotiate-for-yourself-when-people-dont-expect-you-to">Here are some practical tips</a> for negotiating a pay rise. </p>
<p><strong>Prepare</strong></p>
<p>Start from the perspective that more of the world is negotiable than you might expect. Be clear about what you want. Help the other person to understand what you want and why you want it. </p>
<p>Do your homework. Gather information about what is a reasonable pay rise and use this information to develop a strong rationale for your request. </p>
<p><strong>Build the relationship</strong></p>
<p>We are better able to influence others when they like us. You should establish a rapport with whomever you’re asking. Try to send them signals that you’re trustworthy and approachable. This will not only help you now but down the track. </p>
<p>Be sure that you don’t damage your relationships when tensions surface in a negotiation. Rather than respond negatively or competitively, use points of tension to gather more information about your boss’s rationale.</p>
<p><strong>Show them you’re listening</strong> </p>
<p>Understanding the other person’s concerns and constraints usually results in better outcomes for both negotiators. If your boss doesn’t agree with your proposal, try to understand if something is holding him or her back. Are there external constraints that make it difficult for them to agree? </p>
<p>Frame your requests from the other person’s perspective. How will agreeing to your pay rise benefit them? And try to understand the reasons behind their questions. </p>
<h2>The moral question</h2>
<p>In the absence of a strong collective voice, recent research suggests that low-power workers may improve their outcomes if they elicit concern from their employers by, for example, <a href="http://psycnet.apa.org/journals/apl/100/6/1847/">expressing sadness</a> or <a href="http://www.sciencedirect.com/science/article/pii/S0749597815000990">seeking sympathy</a>. Appealing to an employer’s emotions may make them more open to renegotiating wages, because it shifts the framing of the request from a pragmatic (economic) perspective to a moral one. </p>
<p>Lowe’s comment actually raises a broader moral question: where does the onus for fair compensation lie? Placing responsibility on employees is likely to disadvantage the already disadvantaged: groups such as women, who are reluctant to ask and who are derogated when they do. </p>
<p>So perhaps organisations, which have a duty of care towards their employees, bear some of the responsibility for ensuring fair compensation. Employment relationships are underpinned by a social (psychological) contract and the expectation that each party will “do right” by the other. </p>
<p>At a time when company profit shares are at an all-time high and wages growth is flat, perhaps organisations should think a little harder about their side of the social contract.</p><img src="https://counter.theconversation.com/content/79756/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mara Olekalns receives funding from the Australian Research Council</span></em></p>Building negotiating power is crucial for anyone looking to ask for a pay rise. But for those who can’t, perhaps it’s the employers’ responsibility to ensure fair compensation.Mara Olekalns, Professor of Management - Negotiations, Melbourne Business SchoolLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/766262017-04-27T08:44:20Z2017-04-27T08:44:20ZFact Check: do six million people earn less than the living wage?<figure><img src="https://images.theconversation.com/files/166684/original/file-20170425-13408-1775902.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">via shutterstock.com</span></span></figcaption></figure><blockquote>
<p>I’m angry and fed up with the way in which six million people earn less than the living wage.</p>
</blockquote>
<p><strong>Jeremy Corbyn, leader of the Labour Party, <a href="http://www.bbc.co.uk/iplayer/episode/b08nxsbr/the-andrew-marr-show-23042017">interviewed</a> on the BBC’s Andrew Marr show on April 23</strong>.</p>
<p>To assess this claim by Jeremy Corbyn, distinguishing various low-wage floors is important. In 2017, the Living Wage Foundation’s higher voluntary <a href="http://www.livingwage.org.uk/what-is-the-living-wage">Real Living Wage</a> (RLW) is £9.75 an hour in London, £8.45 elsewhere, based on a calculation of living costs.</p>
<p>The government’s compulsory wage floor is lower and covers all employees. For employees aged 25 and over, it’s called the <a href="https://www.gov.uk/national-minimum-wage-rates">National Living Wage</a> (NLW) and is £7.50 per hour. For younger employees, it’s called the National Minimum Wage, and ranges from £3.50 to £7.05. </p>
<p>Corbyn’s claim concerns the RLW, and the Labour Party directed The Conversation to <a href="http://visual.ons.gov.uk/how-many-jobs-are-paid-less-than-the-living-wage-in-your-area/">figures from</a> the Office for National Statistics (ONS), which show that in 2014 an “estimated 5.9m jobs were paid below the Living Wage”.</p>
<p>But the underlying <a href="http://visual.ons.gov.uk/how-many-jobs-are-paid-less-than-the-living-wage-in-your-area/">ONS data</a> refers to the number of employee jobs with hourly earnings below the RLW in April 2014, so Corbyn should be referring to <a href="https://fullfact.org/economy/how-many-earn-below-living-wage/">jobs rather than people</a> when making this claim. The two are not identical because some people may hold more than one job. It has been estimated that, in 2014, 5.4m people with <a href="http://webarchive.nationalarchives.gov.uk/20160105160709/http://www.ons.gov.uk/ons/about-ons/business-transparency/freedom-of-information/what-can-i-request/published-ad-hoc-data/labour/october-2015/jobs-paid-less-than-the-living-wage-in-2014-by-work-pattern.xls">one job</a> earned less than the RLW.</p>
<p>More recent ONS data from <a href="http://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/adhocs/006335annualsurveyofhoursandearningsashenumberandpercentageofemployeejobswithhourlypaybelowthelivingwagebyparliamentaryconstituencyandlocalauthorityukapril2015and2016">April 2016</a> estimates that the number of UK employee jobs paid below the RLW increased from 6.16m (22.8%) in 2015 to 6.22m (23.2%) in 2016. More jobs are now paid below the RLW, up from 19% in 2012. Many more part-time jobs are paid below it, compared to full-time jobs, and more women’s jobs than men’s are below the threshold.</p>
<iframe id="datawrapper-chart-P8RMP" src="https://datawrapper.dwcdn.net/P8RMP/2/" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="282"></iframe>
<p>Regarding the legal thresholds, in April 2016, when the NLW was introduced, an <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/lowpay/apr2016">estimated 362,000 jobs</a> were paid less than the statutory minimum – 1.3% of UK employee jobs. This includes those aged between 16 and 25.</p>
<p>The labour market (notably outside London and the South East) is still suffering from wage stagnation after the 2008 financial crisis and subsequent economic recession and austerity, with the low-paid hit hardest. The UK has drifted further towards a low wage, low productivity, low-quality employment model, while the membership density and bargaining power of trade unions to win higher wages has weakened. </p>
<h2>Verdict</h2>
<p>Given ONS earnings projections, it would be more accurate for Jeremy Corbyn and others to refer to the number of employee jobs (rather than people) paid below the RLW. The latest available data indicates that 5.4m people with one job were earning less than the RLW in 2014. That said, in April 2016, 6.22m employee jobs were paid below the RLW, continuing a rising trend in recent years. So while Corbyn’s statement is somewhat misleading, it is true in essence. </p>
<h2>Review</h2>
<p><em>Chris Grover, senior lecturer in social policy, Lancaster University</em></p>
<p>I agree with the verdict, and Corbyn should have referred to six million jobs, rather than six million people. The concept of a “living wage” is a handy device to highlight low pay. What is less clear is to what extent a person earning such a wage might expect to “live”. This is most visible in the government’s NLW, which aims to increase the wages of older workers to <a href="https://www.gov.uk/government/publications/national-living-wage-nlw/national-living-wage-nlw">60% of median hourly earnings by 2020</a>. This approach relates wages to what others earn, rather than the cost of living.</p>
<p>The RLW is related to living costs. But it is <a href="http://www.resolutionfoundation.org/app/uploads/2016/10/Living-wage-calculations.pdf">calculated</a> using weighted averages for a range of families. For this and other reasons, some families, particularly those headed by lone mothers and couples with more than three children, being paid the RLW will face continuing poverty while in paid work. Even deeper poverty will be faced by such families being paid the NLW.</p>
<p><em>The Conversation is checking claims made by public figures. Statements are checked by an academic with expertise in the area. A second academic expert then reviews an anonymous copy of the article. Please get in touch if you spot a claim you would like us to check by emailing us at <a href="uk-factcheck@theconversation.com">uk-factcheck@theconversation.com</a>. Please include the statement you would like us to check, the date it was made, and a link if possible.</em></p><img src="https://counter.theconversation.com/content/76626/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Chris Grover has previously received funding from the British Academy.</span></em></p><p class="fine-print"><em><span>Tony Dobbins does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Labour leader Jeremy Corbyn claims they do. Two academics assessed the facts.Tony Dobbins, Professor of Employment Studies, Bangor UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/755322017-03-31T03:02:58Z2017-03-31T03:02:58ZMore low-paid work is part of the problem, not the solution<p>Employer organisations such as the <a href="http://retail.org.au/news-posts/ara-proposes-1-2-percent-minimum-wage-increase/">Australian Retailers Association</a>, <a href="https://www.fwc.gov.au/documents/sites/wagereview2017/submissions/ausgovsub.pdf">supported</a> by the federal government, have recently argued that wages for Australia’s lowest-paid workers should be increased by less than inflation. This would mean a cut in real wages. But none of their assertions are sustained by evidence or research. </p>
<p>Three arguments have been put forward to cut the minimum wage. First, that the cut will ensure employers <a href="https://www.fwc.gov.au/documents/sites/wagereview2017/submissions/ausgovsub.pdf">create more low-paid jobs</a>, thereby reducing unemployment. Second, that low wages are not a problem anyway, as low-paid workers are “<a href="http://www.afr.com/news/economy/employment/excessive-minimum-wage-rise-will-hurt-young-jobless-say-economists-20170329-gv9jx2">often found in high-income households</a>”. Finally, that there have <a href="https://www.fwc.gov.au/documents/sites/wagereview2017/submissions/ausgovsub.pdf">not been sufficient productivity improvements</a> to support wage increases for the low-paid. </p>
<p>This is counter to the current thinking on wages. After advocating for decades that Australia needed more (downward) “wage flexibility” to solve unemployment, key international agencies – including the World Bank, IMF and the OECD – <a href="https://www.oecd.org/g20/topics/employment-and-social-policy/G20-labour-markets-outlook-key-challenges-and-policy-responses.pdf">now recognise</a> this misses the point. Australia’s award wages for our lowest-paid workers are <a href="http://www.tradingeconomics.com/country-list/minimum-wages">among the highest in the world</a> and this is now recognised as a good thing.</p>
<p>Meanwhile, deepening inequality, much of it originating in the labour market, is retarding the demand necessary to sustain output and employment growth. If people’s real earnings fall, then they have less to spend. When people spend less, demand for goods and services falls, and in turn so does the demand for labour (i.e. jobs). This is why a cut in wages for low-paid workers will not create jobs; rather it will reduce living standards for those earning them. </p>
<p>In Australia, there is modest alarm at just how low wages growth has become. Wages are growing at <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6345.0">only 1.9% per annum</a>, which is significantly down on the rate <a href="http://www.tradingeconomics.com/australia/wage-growth">over the last decade</a>. </p>
<p>The RBA <a href="https://www.rba.gov.au/publications/bulletin/2017/mar/pdf/bu-0317-2-insights-into-low-wage-growth-in-australia.pdf">recently released research</a> noting workers now have too little bargaining power in wage setting. Even the federal treasurer <a href="http://www.abc.net.au/news/2017-03-13/scott-morrison-low-wage-growth-biggest-challenge-economy/8350032">has said</a> slow wage growth is one of the economy’s biggest problems. It could also cause issues for the budget, as it means less income tax for the government. </p>
<p>Cutting wages for the lowest-paid will only make these problems worse, not better.</p>
<h2>The facts on low wage earners</h2>
<p>While wages are growing only slowly, the average Australian worker produces approximately <a href="http://www.tradingeconomics.com/australia/productivity">twice as much</a> as he or she did three decades ago. This echoes a <a href="http://journals.sagepub.com/doi/abs/10.1177/0950017013479829">world-wide disconnect</a>. The ILO, OECD and IMF have all <a href="https://www.oecd.org/g20/topics/employment-and-social-policy/G20-labour-markets-outlook-key-challenges-and-policy-responses.pdf">noted</a> that there is a deep problem in the wage-productivity nexus – wages have not kept up with productivity! </p>
<p>The key challenge today is not “productivity” per se, but rather how gains from increasing productivity are distributed and used. Given the <a href="http://www.treasury.gov.au/PublicationsAndMedia/Publications/2013/Economic-Roundup-Issue-2/Economic-Roundup/Income-inequality-in-Australia">increasing inequality</a>, it is clear the gains have not been well distributed or deployed. This has resulted in huge gains for upper income earners. That, in turn, has driven inflation for assets like property and shares. </p>
<p>The productive performance of the economy or quality of social services has suffered commensurately. In short, the 30-year experiment in neoliberal policies – including attacks on labour standards like award wages – has failed. This, and not the alleged “unproductive” performance of low-paid workers, is the problem. </p>
<p>While shareholder value may have been maximised, the gains for society at large have been modest. Worse, things like <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6202.0">job quality</a> have fallen as a result.</p>
<p>Further, while some low-paid workers do live in high-income households, we should keep <a href="https://www.fwc.gov.au/documents/sites/wagereview2017/submissions/ausgovsub.pdf">some facts</a> in mind.</p>
<p>The first is that in the bottom 20% of households hardly anyone works – they are either on income support or retirees. When this sub-population is included, then low-paid workers are, by definition, in the “top 80%”. But when the data for households with working earners are considered separately, the majority of low- and middle-wage workers <a href="http://trove.nla.gov.au/work/10215750?selectedversion=NBD25084709">live with other low- and middle-wage earners</a>.</p>
<p>The rest of the low- and middle-wage earners who live in wealthy households are often wives with well-paid spouses, and young people, many of whom are students. But cutting wages for these groups will also deepen well-known problems. Marriages break up and women can become totally dependent on their low-paid jobs. Many young people are living at home longer because housing is becoming unaffordable.</p>
<h2>Enough with the failed experiment</h2>
<p>The government has <a href="https://www.fwc.gov.au/documents/sites/wagereview2017/submissions/ausgovsub.pdf">argued</a> that targeted income support provided through the social welfare system is better for “meeting the needs of low-paid households”. This argument is flawed on two grounds. </p>
<p>First, it would support a wages policy that makes things worse and not better. Second, there are no budget submissions to increase social policy expenditure by the billions of dollars necessary to compensate for any cut in the wages of low-paid workers. </p>
<p>The recent decision to <a href="https://theconversation.com/au/topics/penalty-rates-3725">cut Sunday penalty rates</a> for low-paid hospitality and retail employees has created a lot of indignation. Growing numbers of people are uneasy about how we treat our lowest-paid workers. This unease is well founded. Cutting living standards of the lowest-paid workers will not help fix our current economic malaise – in fact, it will make the situation worse. </p>
<p>There is now ample evidence and a growing policy research literature on how to nurture more sustainable and inclusive approaches to economic development. The nation would benefit immensely if we stopped the failed neoliberal experiment we have all been subjected to over the last three decades.</p><img src="https://counter.theconversation.com/content/75532/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Buchanan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Employer groups are calling for a cut in real wages for low paid workers, but this would only exacerbate current problems.John Buchanan, Head of the Discipline of Business Analytics, University of Sydney Business School, University of SydneyLicensed as Creative Commons – attribution, no derivatives.