Tuesday, October 04, 2016

Hillary, speak to service workers

In this aphorism by Binyamin Appelbaum lies latent, I think, the organizing principle, articulated or not (okay, not), of Hillary Clinton's economic agenda:
Soon, we will be living in the United States of Home Health Aides, yet the candidates keep talking about steelworkers. 
Let's back up for some context. While U.S. manufacturing output is at an all-time high,  80% of Americans work in the service sector, Appelbaum reports, Yet politicians of both parties keep romanticizing and prioritizing manufacturing jobs:

This myopic focus on factory jobs distracts from another, simpler way to help working Americans: Improve the conditions of the work they actually do. Fast-food servers scrape by on minimum wage; contract workers are denied benefits; child-care providers have no paid leave to spend with their own children.

According to the Bureau of Labor Statistics, there were 64,000 steelworkers in America last year, and 820,000 home health aides — more than double the population of Pittsburgh. Next year, there will be fewer steelworkers and still more home health aides, as baby boomers fade into old age. Soon, we will be living in the United States of Home Health Aides, yet the candidates keep talking about steelworkers. Many home health aides live close to the poverty line: Average annual wages were just $22,870 last year. If both parties are willing to meddle with the marketplace in order to help one sector, why not do the same for jobs that currently exist?
Why not, indeed? As Richard Florida pointed out years ago, manufacturing jobs are not "inherently" good:
.. the blue-collar jobs we pine for were not always good jobs: we made them good jobs. When my father came back from the second world war, his poorly paid factory job had been transformed. He was able to buy a house, put his two sons through college and participate fully in the American dream. Some of this was due to the power of unions. Most of it was because of the enormous improvements in productivity wrought by improved technologies and management techniques.

The same thing can and must happen in the service sector.
It can and must because U.S. manufacturing prowess has not diminished. Slow productivity growth notwithstanding, the country generates enough wealth to create broadly shared prosperity. What's diminished is the share of corporate profits that go to wages. And that's a matter of policy.

Hillary Clinton's long list of economic policy proposals includes items that would improve service workers' conditions, income and leverage: a higher federal minimum wage, guaranteed paid family leave, enforcing equal pay for women, incentivizing profit-sharing, strengthening collective bargaining (how?). She has a host more designed to increase safety net support (e.g., further subsidizing health insurance and capping childcare costs) and equip more people for higher-paying (probably service) jobs -- e.g., debt-free college.  She would pay for the safety net, education, and job-boosting programs like infrastructure investment in large part by raising taxes on the wealthy.

But as Appelbaum suggests about politicians of both parties generally, Clinton rhetorically privileges non-service jobs -- via infrastructure spending, R&D funding, clean energy investment.. Here are the first four bullets in part one of the long 5-part list of bullet points that constitute her economic plan:

  • Launch our country’s boldest investments in infrastructure since we built the Interstate highway system
  • Make audacious advancement in research and technology, creating the industries and jobs of the future
  • Establish the U.S. as the clean energy superpower of the world—with half a billion solar panels installed by the end of her first term and enough clean renewable energy to power every home in American within ten years of her taking office
  • Strengthen American manufacturing with a $10 billion “Make it in America” plan.
Provisions to improve wages, conditions and benefits in the jobs Americans are in now have to wait for parts 3 and 5, where they're mingled with tax policy and safety-net programs.

It's true that a coherent economic policy has to have many moving parts, and also true that there needs to be a dual focus on training more workers for higher-skilled work and paying people well for the work they do now. But to my mind the dominant chord should be boost employees' share of corporate profits, which currently is at a long-term low. And Appelbaum is dead-on to suggest that speaking more directly to service workers is key to making that message resonate.

1 comment:

  1. This is a good article. I remember being somewhat shocked at how few jobs were created by the infrastructure projects in the big 2009 deficit reduction spending. The work is more automated, and the people who get hired already have other jobs for the most part. When Harry Hopkins founded the WPA, he told the managers not to use automation so that we could employ more men using shovels.

    There is one problem in raising wages for people like home health workers. Their wages must be paid by people who are mainly old and sick and are far from rich. We would have to have federal subsidies to raise pay substantially.