Wages are still too low in H-2B occupations: Updated wage rules could ensure labor standards are protected and migrants are paid fairly
Key takeaways:
- The H-2B program’s wage regulations are allowing employers to legally undercut U.S. wage standards and underpay migrant workers.
- In all but one of the top 15 H-2B occupations in 2019, the average hourly wage certified nationwide for H-2B workers was lower than the average hourly wage for all workers in the occupation nationwide.
- One way to fix this would be to require that employers pay H-2B workers at least the highest of the local, state, or national average wage for the occupation. The Biden administration has the legal authority to make these changes, and they should consider doing it quickly in order to protect migrant workers and U.S. wage standards.
Last week, I wrote about how the U.S. Department of Homeland Security (DHS) and the U.S. Department of Labor (DOL) are now considering increasing the number of H-2B visas in response to businesses claiming that there are labor shortages in H-2B industries—a claim that unemployment data reveal is false. A related and essential issue to this discussion is the prevailing wage rules that undergird the H-2B program, which exist for the purpose of establishing a minimum, legally required wage that jobs must be advertised at in the United States when recruiting U.S. workers—a requirement before employers can access the H-2B program—in order to determine if there’s a labor shortage. The purpose of the H-2B prevailing wage requirement is also to safeguard U.S. wage standards in H-2B occupations and protect migrant workers from being legally underpaid through visa regulations.
In most cases, since 2015, the DOL’s H-2B wage methodology has required that employers advertise H-2B jobs to U.S. workers at the local average wage for the specific occupation and pay their H-2B employees that wage—according to data from the DOL’s Occupational Employment Statistics (OES) survey. While at first glance this appears to be a reasonable wage rule, in practice, the available evidence makes clear that the H-2B wage rule is undercutting wage standards at the national level in H-2B occupations and is therefore not consistent with the law establishing the H-2B program.
The American Rescue Plan clears a path to recovery for state and local governments and the communities they serve
The passage of the American Rescue Plan (ARP) is a watershed moment for state and local governments. It is an opportunity to undo much of the damage caused by the COVID-19 pandemic and begin to address some of the long-standing inadequacies and inequities caused by decades of disinvestment in public services. As our colleague Josh Bivens notes, the bill’s $350 billion in aid to state and local governments will critically help many localities fill in for revenue losses, stem budget cuts, and respond—with important flexibility over the next few years—to massively increased fiscal demands caused by the pandemic.
Although revenue losses in some states were not as dire as predicted early in the pandemic, state and local governments across the country have, nevertheless, already made massive cuts to their budgets and staffs. These cuts have serious implications for the health of local economies and the quality of life in those communities. In this piece, we document the losses that have already occurred in state and local government workforces and take a closer look at who these workers are and what they do. We also discuss the opportunity that policymakers now have to truly “build back better” and what that could mean for communities throughout the country that were struggling long before the coronavirus appeared. In particular, we show that:
- State and local job cuts during the COVID-19 pandemic have been unprecedented and widespread.
- Most state and local government employees work in education (50.4%). This workforce also provides public services that keep communities healthy and safe.
- Women and Black workers are disproportionately represented in state and local government jobs. Women make up 59.6% of this workforce, compared with 46.6% of the private sector. Black women account for 8.7% of state and local government workers, compared with 6.4% of private-sector workers.
- The American Rescue Plan provides an opportunity for state and local governments to work toward addressing racial inequities and expanding public supports in their communities.
Hires continue to slow in the Job Openings and Labor Turnover Survey for January
Last week, the Bureau of Labor Statistics (BLS) reported that, as of the middle of February, the economy was still 9.5 million jobs below where it was in February 2020. This translates into a 11.9 million job shortfall when using a reasonable counterfactual of job growth if the recession hadn’t occurred.
Today’s BLS Job Openings and Labor Turnover Survey (JOLTS) reports little change in January 2021, a clear sign that the recovery is not charging ahead. In fact, hiring and job openings are below where they were before the recession hit, which makes it impossible to recover anytime soon when we have such a massive hole to fill in the labor market. In January, job openings mildly increased from 6.8 million to 6.9 million while hires softened for two months in a row. Hires declined from 6.1 million in November to 5.4 million in December, then down to 5.3 million in January.
One of the most striking indicators from today’s report is the job-seekers ratio—the ratio of unemployed workers (averaged for mid-January and mid-February) to job openings (at the end of January). On average, there were 10.1 million unemployed workers compared with only 6.9 million job openings. This translates into a job-seekers ratio of about 1.5 unemployed workers to every job opening. Put another way, for every 15 workers who were officially counted as unemployed, there were only available jobs for 10 of them. That means that, no matter what they did, there were no jobs for 3.1 million unemployed workers.
Unemployment insurance claims are still about 18 million more than they were a year ago: The new relief and recovery bill will help millions of families
One year ago last week—the week ending March 7, 2020—was the final week of normal unemployment insurance (UI) claims before the COVID recession. That week, there were 211,000 initial UI claims. The week after that, it jumped to 282,000. From there, it skyrocketed into the millions.
Last week—the week ending March 6, 2021—another 1.2 million people applied for UI. This included 712,000 people who applied for regular state UI and 478,000 who applied for Pandemic Unemployment Assistance (PUA)—the federal program for workers who are not eligible for regular unemployment insurance, like gig workers. The 1.2 million who applied for UI last week was unchanged from the prior week. The four-week moving average of total initial claims was also unchanged.
Last week was the 51st straight week total initial claims were greater than the worst week of the Great Recession. (If that comparison is restricted to regular state claims—because we didn’t have PUA in the Great Recession—initial claims last week were greater than the 10th-worst week of the Great Recession.)
Claims of labor shortages in H-2B industries don’t hold up to scrutiny: President Biden should not expand a flawed temporary work visa program
Key takeaways:
- The Biden administration is now considering whether to increase the number of visas in the H-2B program—a temporary work visa program for lower-wage jobs intended for use when there are labor shortages—and is under significant pressure from business groups to roughly double the size of the program.
- The economy, however, is showing no signs of labor shortages in H-2B jobs. In fact, the opposite is true: The latest labor market data show very high unemployment rates in major H-2B industries as well as nearly 5 million unemployed workers in a host of occupations for which H-2B jobs are commonly approved.
- The H-2B program’s current rules make it easy for employers to game the system when it comes to recruiting unemployed workers. And the program is flawed, rife with abuse, and in desperate need of reform, as numerous reports and investigations have proven, calling into question the credibility of the program.
- President Biden has the authority to direct the leadership at the Departments of Homeland Security and Labor to reject an increase the H-2B program in 2021, based on the fact that there are no labor shortages in H-2B industries that would justify such an increase. He should instead push for major reforms of the H-2B program that would ensure domestic recruitment efforts become legitimate and that migrant workers will be treated and paid fairly and have a path to citizenship.
Strengthening workers’ right to organize is 50 years overdue
The union election underway at an Amazon fulfillment center in Bessemer, Alabama, has caught national attention because of how significant a win would be for workers in the South and across the country. Even President Biden has weighed in on the importance of unions, proclaiming in a new video that workers should have a free choice to organize without interference or threats from their employer—a presidential endorsement that is without precedent in our lifetimes. This week, the House of Representatives is scheduled to debate and presumably pass comprehensive legislation—the Protecting the Right to Organize (PRO) Act—to strengthen workers’ ability to join together and form unions to negotiate for better pay, safety protections, and fairness on the job.
This newfound attention to the importance of workers having collective power to bargain with their employers is welcome, but it is long overdue—more than 50 years overdue.
The fact is, Amazon is using tactics to fight its workers in Bessemer, Alabama—thinly veiled threats, mandatory meetings in which management rails against the union, hiring third-party professional union busters—that are standard fare in the employer playbook, and have been for decades. Employers fully realize and take advantage of fundamental, structural weaknesses in our federal labor law that is supposed to protect and promote workers’ freedom to organize unions.
We recently co-authored a paper that shows, by the late 1960s and early 1970s, employers had learned how to exploit the weaknesses in the National Labor Relations Act to block union organizing. Employers realized the law has no teeth—it literally has no monetary penalties against employers who illegally fire union activists or otherwise interfere with workers’ rights. Under the guise of “free speech,” employers are allowed to hold one-sided “captive audience” meetings, where management criticizes and lobbies against forming a union, often predicting layoffs and strikes if workers unionize. Yet the union isn’t allowed in the room, and companies frequently forbid workers from speaking up or exclude pro-union workers from the meeting. Employers routinely bend and break the law. A recent Economic Policy Institute report found that in four out of 10 organizing efforts, workers have to file charges to try to stop their bosses’ illegal activity. In up to a third of elections, employers are charged with illegally firing union supporters.
The ‘$15 minimum wage is too expensive for Peoria’ argument doesn’t hold water: Five reasons why
The one argument made often in the debate over raising the minimum wage to $15 an hour nationwide by 2025, is that you can’t expect to pay the same wages in Chicago as you do in Peoria.
Such an increase, critics contend, will bankrupt small businesses, will impact payroll decisions for corporations with operations nationally, will raise wages beyond what folks outside of big cities need to make ends meet—and will ultimately hurt local economies.
Turns out, these arguments are bogus.
Here are five reasons why:
1. $15 anywhere in this country makes cost-of-living sense.
Today, in all areas across the United States, a single adult without children needs at least $31,200—what a full-time worker making $15 an hour earns annually—to achieve a modest but adequate standard of living. By 2025, workers in these areas and those with children will need even more, according to projections based on the Economic Policy Institute’s Family Budget Calculator.
AAPI Equal Pay Day: Essential AAPI women workers continue to be underpaid during the COVID-19 pandemic
Asian American/Pacific Islander (AAPI) Equal Pay Day is March 9, marking the number of days into 2021 that AAPI women must work to make the same amount as their white male counterparts were paid in 2020. AAPI women are paid 94 cents on the dollar on an average hourly basis, relative to non-Hispanic white men with the same level of education, age, and geographic location. Further disaggregating this data reveals that Pacific Islander women earn 61 cents on the dollar relative to their non-Hispanic white male peers.
During this pandemic, members of the AAPI community have been victims of a horrific rise in discrimination, violence, and hate crimes—which we must call attention to and urgently address. In addition, AAPI women who are essential workers have continued to face an alarming and unacceptable pay gap. The infographics below take a closer look at average hourly wages of AAPI women and non-Hispanic white men employed as elementary and middle school teachers, registered nurses, cashiers, and wait staff. We find that AAPI women make between 11% and 21% less than non-Hispanic white men in these occupations.
The pay disparities are largest among elementary and middle school teachers, with AAPI women being paid just 79% of what non-Hispanic white men are paid. AAPI women registered nurses are paid 82% of what non-Hispanic white men are paid. Lastly, AAPI women cashiers and wait staff make 84% and 89%, respectively, as much as non-Hispanic white men in those occupations. It is long past time to ensure equal pay for AAPI women.
The Senate must pass the $1.9 trillion relief and recovery plan with the UI provisions extended to October 3
Another 1.2 million people applied for unemployment insurance (UI) benefits last week, the last week of February. This included 745,000 people who applied for regular state UI and 437,000 who applied for Pandemic Unemployment Assistance (PUA)—the federal program for workers who are not eligible for regular unemployment insurance, like gig workers.
The 1.2 million who applied for UI last week was roughly the same as the prior week (an increase of 18,000). The four-week moving average of total initial claims was unchanged.
Last week was the 50th straight week total initial claims were greater than the worst week of the Great Recession. (If that comparison is restricted to regular state claims—because we didn’t have PUA in the Great Recession—initial claims last week would have been higher than the sixth-worst week of the Great Recession.)
What to watch on jobs day: Who has been hurt by the pandemic recession—and why we should ignore wage growth for now
On Friday, the Bureau of Labor Statistics (BLS) will release its latest jobs report on the state of the labor market for February 2021, exactly one year since the labor market peak before the pandemic recession hit. Overall, the labor market is down 9.9 million jobs since February 2020. And if we count how many jobs might have been created if the recession had not hit—a more appropriate counterfactual for the current hole we are in might be average job growth over the 12 months before the recession (202,000)—we are now short 12.1 million jobs since February 2020.
In this jobs day preview post, I remind readers which sectors are still experiencing the greatest shortfalls in jobs, which demographic groups have been hardest hit, and which metrics we should continue to ignore in this unusual recession.
Leisure and hospitality workers remain the hardest hit in the pandemic recession, with a 3.9 million job shortfall since February 2020 (as shown in Figure A). These losses are particularly devastating for leisure and hospitality workers and their families because they are among the lowest-paid workers in the U.S. economy.