It’s Not Just Money: Thirty-Five Million Workers in Low-Wage Jobs*

UNCOMMON SENSE 26 © July 2002

By Beth Shulman, formerly an International Vice President and Executive Board Member of the United Food and Commercial Workers International Union, now a lawyer and a consultant to labor unions and non-profit organizations. Her forthcoming book is The Betrayal of Work (The New Press).

Full employment means more than jobs for all. It also means, among other things, decent wages, benefits and a humane workplace-that is, a social contract.As MIT professor Tom Kochan noted in his presidential address to the Industrial Relations Research Association, a social contract is “the expectations and obligations that workers, employers, and their communities and societies have for work and employment relationships.” Since World War II, if one worked hard, the expectation of a livable income and basic securities for oneself and one’s family was the implicit understanding of this social contract.

If the social contract–far from universal even in its heyday–has eroded for many workers, it is nonexistent for those who work in low-wage jobs. For thirty-five million workers–one in four–who get up every morning or evening and go to work in low-wage jobs, however, the most basic expectations from work–a decent wage, basic benefits, and respect–go unfulfilled.

These low-wage workers educate and train our children, care for our parents and friends, clean and assist us in our hotel rooms and offices; answer our questions on toll-free calls; prepare our food and serve our families in restaurants; protect us in airports, offices, and government buildings; cash our checks and take our deposits; harvest and process the meat, chicken, and other food we eat; sew and clean the clothes we wear; wait on us in department, grocery, and drugstores; and enter information into databases. These low-wage jobs are intimately involved in every aspect of our lives, yet they provide workers with wages that are at or near the poverty line. While recent tight labor markets have helped inch up the wages at the bottom, in the economic boom of the late 1990’s, thirty-five million workers still earned less than $8.75 an hour.

Low wages-only part of the problem

Inadequate wages, however, are only part of the problem. Workers in low-wage jobs lack the basic security, freedom, control and flexibility in their lives that most other workers take for granted. Most workers in low-wage jobs are not provided any health coverage–not even that paid for by employees. Those that are, generally cannot afford to buy it. Not surprisingly, these workers are exposed to more physically damaging working conditions and workplace safety and health hazards than in most higher-paying jobs, which put them at a higher risk for sickness and accidents. Their jobs give little leeway to take a day off for illness and, if they can get off, they rarely get paid.

Little flexibility exists to balance work and family. Planning for family responsibilities is more difficult in low-wage jobs because their schedules are less predictable. Low-wage employers give their workers little time to tend to a sick child or for personal needs or emergencies. Because of this inflexibility, tending to family concerns can become a choice for workers between taking care of their family or keeping their job. Paid vacations and holidays are less available than in higher-paying jobs, meaning less time to spend with family members. A disproportionate burden of working night shifts falls on workers in low-wage jobs, which makes child-care even more expensive and difficult to obtain.

And there is little security in these jobs. These workers experience more frequent and recurrent periods of unemployment than workers in higher-paying jobs. Yet it is these workers who receive little if any employer-provided severance pay to help them make the transition to another job. Low-wage jobs provide fewer and more variable hours for workers than higher-paying jobs. Many of these workers have part-time or contingent status and earn a lower hourly wage than a full-time worker in the same job.

Unlike many higher-wage jobs, where cooperative models have been introduced in the workplace and employers value workers’ input, most workers in low-wage jobs have little voice or autonomy. Their employers frequently discourage workers from voicing their opinions. Many of these employers lack basic respect for their workers. Low-wage jobs are the least likely to have labor-union representation, leaving these workers without power to change their situations. Employer-provided training opportunities are largely unavailable, diminishing the possibility of job-advancement. Profit sharing is half as likely for these workers as for workers in higher-paying jobs. At the end of their time on the job, these workers will have minimal employer-provided pensions. When such plans are offered, they require worker contributions, which these workers cannot afford.

The final cruelty is that government programs created over the years to protect workers and their families have excluded this most vulnerable segment of the workforce. Laws covering workplace health and safety, protection from discrimination, family and medical leave, wage and hour enforcement, unemployment compensation, workmen’s compensation, and business-closing notice bypass many of these workers. A majority of workers in low-wage jobs work in small businesses, which fall outside many worker-protection laws. Some eligibility requirements for employment and labor statutes, such as minimum hours required or minimum income levels, disqualify many low-wage workers. In other words, workers who are the most vulnerable to the dictates of employers are left without assistance from the government.

It is this “piling on” of all these deprivations together with the meager earnings that make low-wage jobs not just quantitatively different, but qualitatively different from better-paying jobs. The employers’ failure to provide the most basic benefits for low-wage jobs is the antithesis of the reciprocal responsibilities envisioned in the notion of a social contract. Workers in low-wage jobs are meeting their side of the bargain. Employers and politicians are failing to live up to theirs.

Reforming the system

If work is to work for all Americans we must establish a new set of ground rules for these millions of responsible workers who must provide for themselves and their families, yet get little in return. We need an employee bill of rights. We have established standards and rights in the past to ensure that older people would not be impoverished or go without health care; to prevent children from working; to keep our environment clean; and to ensure that workers have equal opportunity regardless of their race, religion, national origin, sex, or age. We must do so now for these thirty-five million workers. We must also restore the right of workers to organize. In prior generations, we have seen low-wage workers move into the middle class through the power of labor unions. Yet as Professor Kochan pointed out in his address, “Study after study has documented the failure of labor law to provide workers with the means to implement what the international community has (correctly) described as a fundamental human right, the right to join a union.” We must ensure that workers have the tools to improve their situation, including the right to choose to have a union. Our work must contribute to the betterment of all those in our society, not just the few.

Because this nation values work, we must reform a system that fails to provide the basic necessities of life to its workers and their families. We must reward work. There are serious consequences to our nation, our communities, our economy, and to us as a people if we fail to rectify this terrible social injustice. A wide economic divide challenges our solidarity and stability. If work does not work for millions of Americans, it challenges our very foundations and beliefs as a nation. It destroys our sense of fairness if we ignore those living by the rules and taking responsibility for themselves and their families. It has consequences for the next generation of children if we ignore this harsh reality. We must act. These workers are not looking for a handout. They are looking for fairness, which will be easier to attain in a society that embraces a full employment policy. It is our responsibility to see that this happens. It is not too much to ask.
*Adapted from “Working Without a Social Contract,” Perspectives on Work, v. 4, no. 1, copyright © 2000 Industrial Relations Research Association, Champaign, IL. Reprinted by permission from the publisher.

Editors: Helen Lachs Ginsburg, Economics (Emer.), Brooklyn College and June Zaccone, Economics (Emer.), Hofstra University