Public Comment

Even many critics of the federal government assume that the Department of Labor’s (DOL) reports on employment related issues is honest and accurate. But actually, neither is true. In fact, what the DOL often claims is good news is really bad news. According to the DOL the economy is producing more jobs, which accounts for the low unemployment rate. The assumption is that the more jobs, the better. However, “It ain’t necessarily so". In fact, it can make things worse.  

What too many employers have been doing to increase their profits is converting full time jobs into part-time positions. For each job that is converted there are then two jobs instead of one. This inflates the number of new jobs that are officially reported, which looks good for the administration.  

The catch is that employers are paying many part-timers less money but not only because they work fewer hours. Part-timers typically earn less per hour than full-time workers. And most do not receive health insurance as well as other fringe benefits. Business benefits and workers, many of whom are former full-timers, lose.  

But even creating part-time jobs doesn’t satisfy many employers. Businesses have been shifting their work to the rapidly growing number of independent contractors who are self-employed. Instead of getting steady work they have to hustle different firms for short term assignments. There can be long stretches when they cannot obtain any work. As a result, they are perpetually insecure and many earn annually only a poverty wage.  

Yet since they are in their own business the DOL counts these workers as employed even when their search for short term contracts is unsuccessful. (But California recently enacted a law, AB-5, that requires employers to define and treat independent contractors as employees. A hopeful sign)  

When jobs are very difficult to find, many workers become too discouraged to continue searching. If they have not actively searched for work in the last four weeks, they are no longer counted as unemployed. Yet according to an official study, over 4.5 million of these workers report that they want to work. Therefore these discouraged workers should be counted as unemployed and there should be an upward adjustment of the unemployment rate.  

Also, they are not counted as unemployed if they only looked at ads because it is classified as a passive search. But the only reason that many of them do not take further steps is because some listings were by firms they already had already contacted or they did not see anything they could apply for. The DOL’S real motive for not counting these workers as unemployed is its habit of underestimating the unemployment rate on behalf of the establishment.  

Among the most exploited workers are the disabled. Although the DOL claims it is committed to helping the disabled to improve their wages, the reality is exactly the opposite. A 1938 provision in the Fair Labor Standards Act permits employers to apply to the DOL for the right to pay a subminimum wage. The Department has been very generous in granting waivers. Many employers are now paying disabled employees just one dollar an hour and even less.  

p.s. Could it be worse? Yes indeed. According to the organization Dream Corps, which is concerned about prison conditions, over 42,000 prisoners work full-time as electricians, carpenters, cooks and other skilled occupations in California. Also, substantial numbers of prisoners are assigned to work in the dangerous jobs as fire fighters. The wages that prisoners receive is as little as 8 cents per hour. Their forced labor at incredibly low wages is tantamount to slave labor. h