Dina Smith sits down at the kitchen table with a small stack of bills every two weeks and asks herself the same question.
“What needs to be taken care of right this second?”
Her twice-monthly paycheck of about $350 means her options are usually limited to paying utilities and restocking a near-empty refrigerator. She’ll put off repairs to her broken-down 2001 Saturn – again – and try to find a few dollars for bus fare instead.
This is life today in one of the tens of thousands of Greater Cincinnati and Northern Kentucky households that survive on the paycheck of a low-wage breadwinner.
Now, their numbers are growing faster, putting more families at risk and slowing an already fragile economic recovery regionwide. Everyone feels the sting when households have less money for homes, furniture, cars, TVs, toasters, smartphones and new shoes.
It’s a legacy of the crash that families and the wider economy may suffer with for years.
A study by the National Employment Law Project finds that low-wage jobs, or those it defines as paying less than $14 an hour, have dominated the economic recovery, often at the expense of better-paying jobs.
The group’s Census-based research shows that low-wage jobs accounted for about 20 percent of job losses during the recession, but almost 60 percent of jobs gained during the recovery.
Mid-wage jobs, by contrast, accounted for 60 percent of recession losses, but only about 20 percent of recovery growth.
“It’s very challenging,” said Smith, who supports three sons in Cumminsville on the $9.80 an hour she earns working as a janitor. “We have to live paycheck to paycheck.”
Life ‘more precarious’ for low-wage workers
Low-wage jobs always have been an important part of the economy, whether they’re fast-food jobs that give teenagers their first taste of the working world, or entry-level jobs for adults who want to learn a trade or bring in some extra money for their family.
The difference now is that those jobs increasingly are supporting families, rather than supplementing the income of a better-paid breadwinner.
Since the recession, the number of households with one wage earner has climbed almost 6 percent, according to the U.S. Census. At the same time, the median income of households with one wage earner has fallen almost 4 percent.
So as more families have become reliant on one income, the value of that income has dropped.
“Their lives are more precarious,” said Randy Albelda, an economics professor at the University of Massachusetts, Boston, who has studied the expansion of low-wage jobs. “When a large number of people supporting families can’t do it, then you have a problem.”
The trend toward more low-wage breadwinners has helped fuel the national debate over raising the minimum wage, which is $7.95 in Ohio and $7.25 in Indiana, Kentucky and other states tied to the federal minimum wage.
Albelda’s latest research found that as many as 20 million people, about half the low-wage workers in America, are household breadwinners. She defined low-wage breadwinners as primary earners who make less than $11 an hour, or about $23,000 a year.
She estimated that between 10 and 14 percent of adult workers now earn a low wage and rely on those earnings to support a household, the biggest share since at least the 1980s.
The instability of low-wage jobs often creates as many problems as the low pay, Albelda said. Benefits typically are minimal, or non-existent, and layoffs or reduced hours are common as employers try to shave costs.
That’s certainly been Smith’s experience. She once worked full eight-hour days, but those hours have been cut to less than five since the recession.
If she misses work because of illness, as she did a few weeks ago, she doesn’t get paid. If her car breaks down, as it did last month, she’s dependent on the bus.
Smith, 43, has considered looking for a job with more hours, but after eight years with the same company, she fears starting over elsewhere will leave her more vulnerable to layoffs. She’s also thinking about taking on a second job, something she’s done in the past.
“A lot of janitors I know work two or three jobs. I’ve been there, done that,” Smith said. “We should be able to work one job, a respectable job, to live.”
Smith doesn’t receive food stamps or other public assistance, and she moved out of public housing and in with a friend because she felt the neighborhood was getting too rough for her 14-year-old son. Her daughter lives on her own, but her other sons, ages 20 and 18, still live at home.
Smith pays utilities and groceries; her friend pays the rent. She’s the only one in her household with a steady job and knows her family can’t survive on her income forever, especially if her hours get cut again.
“I may end up having to sleep in a car, and I don’t want to do that,” she said.
Competition greater for low-paying jobs
Smith, who has a high school diploma, is in some ways a typical low-wage worker. According to Albelda’s study, more than 54 percent are women, 43 percent are minorities and more than 90 percent don’t have a college degree.
During the recession, however, more educated workers slipped into the ranks of low-wage earners, which created problems not only for them, but for the less-educated workers they sometimes displaced.
“It’s a bit more competitive now,” said Chris Janson, Cincinnati metro market manager for the Robert Half staffing agency. “We’ve got folks willing to take less than they’re worth. They’re willing to do it for a limited time, until something better comes along.”
Janson said starting pay for some of those temporary jobs is between $10 and $15 an hour, although he said salaries are beginning to creep up and more options are becoming available to workers as the economy improves.
How much it will improve – and how long it will take wages to reach pre-recession levels – is a question economists have been wrestling with for years. Some fear lower pay and fewer benefits will become the new normal, because the labor pool is large and companies have learned to get by with less.
“This recession was an opportunity for a lot of employers to clear out a lot of people,” Albelda said. “It’s workers on demand now. In industry, they call it just-in-time inventory. So this is just-in-time workers.”
Growing uncertainty in the job market means households would be better off with a second wage earner, regardless of how much the primary wage earner is making. The Economic Mobility Project of the Pew Charitable Trusts has found that many families now require at least two incomes to match or exceed the household income of the previous generation.
“Mobility is increasingly a family enterprise,” said Diana Elliott, a research officer at Pew. “Families need those second earners’ money to move them up the income ladder.”
The impact of more low-wage breadwinners isn’t limited to the breadwinners’ families. If paychecks cover little more than rent, utilities and groceries, the broader economy doesn’t benefit much.
“People have to make a lot of very tough choices,” said Leslie Mendoza Kamstra, spokeswoman for the Service Employees International Union Local 1, which represents janitors, such as Smith, and security officers. “It’s not a high school kid. It’s someone supporting a family.”
Low-paying jobs have been part of Smith’s life since she started working more than 25 years ago. There was a time, she said, when those jobs were more plentiful, the hours were more reliable and the pay was better.
Today, Smith said, that stability is gone. Finding a new job, or a second job, may be the only way she can continue to support her family.
But she said that’s no easy task, either.
“It’s hard to find one job,” she said. “There’s so many people out here looking.” ■
More households survive on one (shrinking) income
Households with one wage earner in 2007: 43.3 million
Households with one wage earner in 2012: 45.8 million
Percent change since 2007: +5.8 percent
Median income of households with one wage earner in 2007: $45,082
Median income of households with one wage earner in 2012: $43,335
Percent change since 2007: –3.9 percent
Source: U.S. Census
Low-paying jobs rebound faster from recession
Share of job losses in recession
Low-wage jobs – 21 percent
Mid-wage jobs – 60 percent
High-wage jobs – 19 percent
Share of job gains in recovery
Low-wage jobs – 58 percent
Mid-wage jobs – 22 percent
High-wage jobs – 20 percent
Definitions: Low-wage jobs are defined as median hourly wages of $7.69 to $13.83, mid-wage jobs are $13.84 to $21.13, and high-wage jobs are $21.14 to $54.55.
Source: National Employment Law Project analysis of U.S. Census data
What is the minimum wage?
Ohio: $7.95 for non-tipped employees; $3.98 for tipped employees
Kentucky: $7.25 for non-tipped employees; $2.13 for tipped employees
Indiana: $7.25 for non-tipped employees; $2.13 for tipped employees
Federal: $7.25 for non-tipped employees; $2.13 for tipped employees
Source: U.S. Department of Labor
The Stevens Point Area Public School District Board will work to decide if it should sign another contract with CleanPower, a janitorial service, or look for services elsewhere. The current contract expires June 30.CleanPower presented the board with a contract Monday, March 31, but the board declined signing it on the grounds that the contract was incomplete and that more time is needed to consider other options. CleanPower will return at the April 14 meeting with a completed contract to seek the board’s approval.
Board member Jeff Presley said he was not comfortable signing a contract with many blank spaces on it.
Superintendent Atilla Weninger suggested the board sign the contract, contingent on their satisfaction with it at the next meeting. He said after the contract is signed the board has 30 days to terminate it. That option was voted down.
Kim Shirek said she has received more than 20 emails from community members complaining about CleanPower.
“I would like to see us change and go to another company and not do a five-year contract,” Shirek said. “I am hoping the board will look at all the emails we have received and not hire them (CleanPower) for another five years.”
Board member Bob Larson said it was not in the budget to change the program.
“We know we can’t afford to have a contract go away, we went through the RFP process like we were supposed to do and CleanPower came up first based on dollars and points,” said Bob Larson. “What do you want to do? Eliminate CleanPower? We can’t sustain it.”
The district uses a mix of contracted employees from CleanPower and its own custodial positions to clean the schools. The district keeps a mix of 60 percent district custodians and 40 percent contracted from CleanPower. By using contracted employees, the district saves approximately $1 million annually.
At the Dec. 16 board meeting, an anonymous document entitled “Daily Issues with CleanPower at SPASH” was presented to the board. The list included things such as exterior doors left unlocked, interior doors left unlocked, resulting in alarms being set off; missing tools, keys and food; locker rooms not cleaned and disinfected; employee turnover; smoking on campus; and late arrival and early leaving. The letter addressed 17 items in total and the board asked that administration respond to the problems.
Thomas Owens, the director of business services, reported back to the board Monday regarding the list of issues.
“We found no facts to substantiate or support the notion that any such things have occurred on a daily basis,” Owens said
Owens interviewed the custodial staff and addressed each of the issues mentioned on the list. Owens said some of the issues listed were too vague and unsubstantiated to address. He cited many of the issues as having occurred once or twice, but said they were dealt with at the time of the occurrence.
One issue not refuted was the high employee turnover.
“The frequency of turnover of CleanPower staff does vary,” Owens said. “Sometimes several people are replaced and at other time periods not so much.”
Regarding this list Weninger said he needs to make a decision based on facts as best as we can get them from the providers.
“I cannot not make a decision based on rumor and innuendo,” Weninger said
Several members of the public spoke at the March 11 board meeting, stating the board should not sign another contract with CleanPower.
Dave Somerscales, a representative from Service Employees International Union Local 1, a labor union based in Milwaukee, attended the March 11 and 31 meetings to speak against CleanPower.
“CleanPower has many accounts, they are paying poverty wages,” Somerscales said. “That brings down the cleaning standard for everybody when you set the bar so low. We wanted to make sure the school board and the surrounding community understood this is not a good company to do business with. This is about accountability and transparency.”
A representative from CleanPower declined to comment at the meeting but agreed to make a statement afterward.
“CleanPower has been engaged in a successful partnership with the Stevens Point school district for the past 10 years,” said Jana Rusk, vice president of human resources and safety for CleanPower. “This relationship has been consistently successful due to our strong local managers, extensive pre-employment background checks, ongoing training and development and our continued focus on safety.”
Columbus. Ohio janitors represented by SEIU will enter the New Year knowing that there is power in the union. The janitors reached a new contract agreement after a one-year battle with predominantly national cleaning companies. Contract talks broke down when the companies demanded a wage freeze and a return to part-time hours. But the janitors decided to stand together and fight. SEIU organizer Amanda Hart.
[Amanda Hart]: “We did fight back. And we joined with community and faith and elected leaders. We rallied and protested and many of our workers even went out on strike. And on two separate occasions community members were arrested in non-violent civil disobedience actions in support of good jobs for our janitors. And at the end of the day their efforts paid off and we improved jobs in Columbus. It really just showed people that whenever you stand up together, gains can be made. This is a victory for us. When you’re looking at your hours being cut from full-time to part-time, that can be up to half your income. Like, how do you survive after that – other than going to get get a second or third job? It’s just not sustainable. And that’s why they made the decision to stand up. And at the end of the day, we did it.”
Carla Nugeness says she and her fellow workers united and were determined to not only fight for their rights and to improve their working conditions, but to win that fight.
[Carla Nugeness]: “I feel much better. We have more full-time buildings, which will help a lot of the janitors. The knocking down the hours was hard for everybody, so the full-time hours will help everybody out. I’ve been out there every day in the cold and the wind and the rain and tryin’ to keep warm at the same, tryin’ to fight for our rights and for everybody else’s rights and help all of us out. All of us janitors have a hard time, I mean, on what we make. And now we can maybe make it.”
The new contract for the Columbus janitors takes effect January 1st.
(Thanks to Evan Davis at WCRS radio in Columbus for audio used in this story.)
Janitors who work in downtown Columbus office buildings have voted to ratify a new three-year contract with their employers, the Service Employees International Union (SEIU) announced yesterday in a press release. The contract, which goes into effect on January 1, will affect about 1,000 janitors and their families.
“Today we proved that when workers join together, we have strength. This is a huge victory for all hard working janitors,” said SEIU Local 1 member Claude Smith on Saturday after the contract vote. “With this new contract, our families can live a little better.”
The main point of contention in contract negotiations was maintaining a majority full-time work force. Cleaning contractors wanted to eliminate full-time hour guarantees. The agreement reached keeps the majority of the workforce at full-time status with company-provided benefits. The contract also includes a $.20 per hour wage increase in 2014.
“We all won today,” said SEIU Local 1 president Tom Balanoff. “The community came together in Columbus and chose prosperity over poverty, full-time work over part-time work. This victory brings hope to security officers, fast food workers, and others trapped by poverty wages.”
Janitors went on strike in multiple Columbus office buildings over the past few months. Employees alleged that cleaning companies had repeatedly violated federal law by harassing and intimidating employees after they called for job improvements. The janitors’ struggle garnered support from religious leaders, elected officials, and community groups in central Ohio.
FOR IMMEDIATE RELEASE
November 19, 2013
Contact: Ivan Moreno | firstname.lastname@example.org | 773.799.6455
With contract talks for hundreds of Milwaukee-area janitors to begin tomorrow…
Milwaukee – SEIU Local 1 janitors rallied today with the support of local leaders like Alderman Tony Zielinski to kick off contract negotiations between hundreds of Milwaukee janitors and some of the largest janitorial contractors in the country. Janitors are joining a growing movement in the nation’s low wage workforce that is calling on the country’s richest corporations to create good jobs that can sustain local communities.
“We can actually do something about poverty in Milwaukee by fighting for good jobs,” said Jeryllyn Jeanes, a Milwaukee janitor and 19-year union member. “This is about respect and receiving fair wages for the hard work that we do every day.”
Union janitors with SEIU Local 1 are proposing a fair wage increase and maintained access to affordable health care. When low wage workers like Milwaukee’s janitors are forced to rely on publicly funded programs, taxpayers are essentially subsidizing the profits of corporations like BMO Harris and the janitorial contractors that they hire.
“Milwaukee janitors are uniting to create good jobs that move our city forward,” said Alderman Tony Zielinski. “We do our part to make Milwaukee strong. Now we call on Milwaukee’s employers to do their part and help create a city that is prosperous for all of us.”
Janitors rallied in front of BMO Harris Bank, a corporation that made $4.1 billion last year alone, but whose janitors, employed by CleanPower, are paid poverty wages with no benefits. In fact, according to the state of Wisconsin, more than 300 of CleanPower’ s Wisconsin employees and more than 500 of their children already rely on public benefits to obtain health care.
Many Milwaukee janitors qualify for and depend on a host of public assistance programs to make ends meet. With the fourth highest poverty rate of any major city in the nation and a high rate of racial income disparity, janitors see a fair contract as a direct way to address Milwaukee’s growing wealth inequality. The current agreement covers more than 400 Milwaukee janitors and expires on December 31, 2013. Talks to negotiate a new agreement are set to start tomorrow, November 20.
SEIU Local 1 unites 50,000 property service workers in the central United States, including janitors, security officers, and food service workers. Together we work to build strength for all working people, on the job and in our communities.
McDonald’s restaurant crew member Dwight Murray has worked four years for the fast-food giant, pulls downs $8 an hour and also relies on food stamps to help support himself and a daughter.
The 27-year-old said he needs food stamps because his barely above-minimum wage doesn’t stretch far enough, even when he works a full 40-hour week.
“There’s no money left for groceries,” Murray says.
Which is why Murray decided to march Tuesday in front of the McDonald’s at 16th and Meridian streets in Indianapolis as part of a union-organized protest in 20 cities of the low wages that are common in the fast-food industry.
“We can’t afford to support ourselves and our families,” said Murray, who marched outside the restaurant over the lunch hour in his black McDonald’s uniform shirt. “To me, if we work here, why do we have to depend on Social Security and food stamps?”
The rally by the Fight for 15 campaign, which has support from the Service Employees International Union and Workers Organizing Committee of Chicago, cites a new study by the University of California-Berkeley that found 52 percent of line workers at fast-food restaurants must rely on food stamps or other forms of public assistance to support their families.
The total taxpayer tab for welfare for fast-food workers: nearly $7 billion a year, according to the study. About $1.2 billion of assistance goes to McDonald’s workers alone, the study says.
It was that whopping tax-supported assistance that prompted Fran Quigley, a law professor at Indiana University Robert H. McKinney School of Law in Indianapolis, to hang a placard in Spanish around his neck saying “Huelga Por 15” and join the 17-person rally.
“I am tired of subsidizing the McDonald’s poverty-level wages,” Quigley said. “The cheap food we enjoy comes at a cost to us — in public assistance.”
In a statement Tuesday, McDonald’s said its wages “are based on local wage laws and are competitive to similar jobs in that market. We also provide training and professional development opportunities to anyone that works in one of our restaurants.”
Rally organizers want the Indiana legislature to increase the state’s $7.25 minimum wage, said Nancy Guyott, president of the Indiana State AFL-CIO, who briefly marched in the rally.
Big fast-food franchises “have the means to do that (raise wages) but instead they are shifting the cost to the taxpayers,” she said. “This is a societal problem we need to fix.”
Bill Church, a Carmel restaurant franchise consultant who also is president of the Mr. Dan’s hamburger chain in Indianapolis, said fast-food operators operate on thin profit margins and raising wages is “not feasible” for most. “You just can’t make dollars out of thin air to pay people (more),” he said.
And low wages are hardly confined to the fast-food industry, Church said. “Movie theaters and car washes. There are a lot of other industries as well … in that same pay scale.”
Rally organizers said they aren’t asking the public to boycott McDonald’s or other fast-food franchises over the wages they pay.
Call Star reporter Jeff Swiatek at (317) 444-6483. Follow him on Twitter: @JeffSwiatek.
Earlier this week, in a dimly lit, overcrowded room in the basement of Jordan Hall on Butler University’s Northside campus, an event occurred with huge significance for the Indiana economy.
The economic leaders in that room were not business executives or politicians wearing suits and ties. They were cooks and cashiers and dishwashers, wearing black uniform shirts and pants along with chef hats and hairnets. For many, their clothes and their faces showed the effects of a long shift on their feet, cooking and serving meals and cleaning up afterward.
These Hoosiers are workers at Butler’s food-service operation, sub-contracted by the university to multi-national company Aramark. At their meeting this week, the workers approved their first contract, an agreement negotiated by their co-workers and their new union, UNITE HERE.
After eight months of negotiations — and some worker protests and displays of community and student support — the company and its
workers agreed to terms that included immediate raises and sustained wage increases over the life of the four-year contract. Starting salaries will be higher, health-care costs will drop, and the company agreed to match contributions to a 401(k) retirement plan. The contract also includes improved access to year-round employment, a critical issue for on-campus workers.
In reaching these terms, these Butler workers joined food service and campus operations workers at Marian University, who agreed to similar terms with Aramark last week. These new contracts mean that 500 service and hospitality workers, including workers at IUPUI and the Indianapolis International Airport, are now receiving higher wages and better benefits thanks to recent union contracts. The Service Employees International Union (SEIU) is working to earn similar contracts for our city’s janitors and security guards.
These developments are good news for all Hoosiers. For many of our neighbors, service-sector jobs are the only work available in our modern economy. These are sustainable jobs, an important feature in a state scarred by the exodus of high-paying manufacturing work. The tasks of washing dishes, cleaning hotel rooms and cooking meals are jobs that cannot be outsourced to a Bangladeshi sweatshop or to a call center overseas.
The workers at Butler, Marian and beyond are proving that such jobs have dignity, and do not have to be characterized by low pay and uncertain tenure. This week’s result is not an anomaly: Unionization of service-sector work has been shown to reliably and significantly increase workers’ wages and benefits.
In the early and mid-20th century, the union movement turned once low-paying manufacturing jobs into solid careers that allowed workers to buy homes and send their kids to college. Workers joining together can do the same for service-sector jobs today. Across Indianapolis, they have already started doing just that.
Quigley is a clinical professor at Indiana University McKinney School of Law.