54 research outputs found
Twenty-Three Years and Still Waiting for Change: Why It's Time to Give Tipped Minimum Workers the Regular Minimum Wage
Last year marked the 75th anniversary of the Fair Labor Standards Act (FLSA), the legislation that established many of the basic labor protections workers enjoy today, such as a 40-hour workweek, overtime protection, and a national minimum wage. There have been periodic amendments to the FLSA over the years, but the 1966 amendments were especially significant. They extended protections to hotel, restaurant, and other service workers who had previously been excluded from the FLSA, but also introduced a new "subminimum wage" for workers who customarily and regularly receive tips.Unlike temporary subminimum wages (such as those for students, youths, and workers in training), the "tip credit" provision afforded to employers uniquely established a permanent sub-wage for tipped workers, under the assumption that these workers' tips, when added to the sub-wage, would ensure that these workers' hourly earnings were at least equal to the regular minimum wage. The creation of the tip credit -- the difference, paid for by customers' tips, between the regular minimum wage and the sub-wage for tipped workers -- fundamentally changed the practice of tipping. Whereas tips had once been simply a token of gratitude from the served to the server, they became, at least in part, a subsidy from consumers to the employers of tipped workers. In other words, part of the employer wage bill is now paid by customers via their tips.Today this two-tiered wage system continues to exist, yet the subsidy to employers provided by customers in restaurants, salons, casinos, and other businesses that employ tipped workers is larger than it has ever been. At the federal level, it currently stands at 2.13 per hour, and the federal regular minimum wage is currently 2.13 since 1991 -- a 23-year stretch, over which time inflation has lowered the purchasing power of the federal tipped minimum wage to its lowest point ever.Proposed federal minimum-wage legislation, the Fair Minimum Wage Act of 2014 -- also known as the Harkin -- Miller bill -- would not only increase the federal regular minimum wage to $10.10, but for the first time in decades would also reconnect the subminimum wage for tipped workers back to the regular minimum wage by requiring the former be equal to 70 percent of the latter. This would be a strong step in the right direction; however, we present evidence that tipped workers would be better off still if we simply eliminated the tipped minimum wage, and paid these workers the full regular minimum wage
Price Floors and Employer Preferences: Evidence from a Minimum Wage Experiment
Minimum hourly wages were randomly imposed on firms posting job openings in an online labor market. A higher minimum wage raised the wages of hired workers substantially. However, there was some reduction in hiring and large reductions in hours-worked. Treated firms hired more productive workers, which can explain, in part, the reduction in hours-worked: with more productive workers, projects were completed in less time. At the conclusion of the experiment, the platform imposed a market-wide minimum wage. A difference-in-differences analysis shows that, in equilibrium, firms still substitute towards more productive workers, adversely affecting less productive workers
What is housing affordability? The case for the residual income approach
This article seeks to increase the awareness of and support for the residual income approach to housing affordability indicators and standards, especially in the United States. It begins with an overview of various semantic, substantive, and definitional issues relating to the notion of affordability, leading to an argument supporting the conceptual soundness of the residual income approach. The concept is then briefly set into the historical context of U.S. and British debates on affordability measures. This description is followed by a discussion of two of the principal issues involved in crafting an operational residual income standard: the selection of a normative standard for non-housing items and the treatment of taxes. The article concludes by considering some of the potential implications of the residual income paradigm for the analysis of housing problems and needs, for housing subsidy policy, and for mortgage underwriting practice
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An Oversight Hearing on the State’s Role in Addressing Income and Wealth Inequality
California Legislature Assembly Committee on Accountability and Administrative Revie
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The Severe Crisis of Jobs in the United States and California
The economy needs jobs, jobs, jobs and more jobs—this is not news to the 25 million unemployed and underemployed workers who continue to bear the hardships of the Great Recession. Workers have grown weary and families once bending are now breaking under the strain. The severe crisis of jobs in the United States and, particularly, in California seems to be lost as austerity dominates the policy dialogue in Washington, DC. In California, another round of cuts and anti-stimulus measures are underway and they will move the state further away from recovery. The downturn has hit the state especially hard and given its size and importance in the U.S. economy it is hard to imagine a robust recovery without the Golden State.The onset of what was to become the Great Recession started in December 2007. Job losses were at first mild but then fell off a cliff the latter half of 2008 coinciding with the bursting of the housing bubble and the resultant implosion of many financial institutions. Situating this labor market in a historical context provides important insights and perspective into the current situation and what we may expect. This paper documents the fallout from the Great Recession by detailing key labor market statistics—the realities are harsh and should give pause to those advocating for economic austerity. A massive jobs bill and aid to struggling states should be top priority
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A post-Great Recession overview of labor market trends in the United States and California
It has been well over a decade since the economy tumbled into what is now dubbed the Great Recession—reflecting the historical severity and swiftness of the downturn. The recession officially lasted from December 2007 through June 2009. However, the economy underperformed for nearly a decade as the output gap—GDP coming in under potential—did not close until the end of 2017. After being in the grips of the worst recession since the Great Depression the economy is currently in a lengthy expansion with record job growth, stock market performance, and unemployment rates. But, troubling challenges remain such as weak wage growth, depressed employment rates, high rates of poverty, and increased inequality.There has been a lot of media attention around advances in automation and how robots are leading to widespread joblessness as the demand for workers shrinks. We find that both of these claims are dubious, at least on a large scale. As this brief will show, job growth is in an unprecedented stretch of monthly gains, unemployment is low and falling, and productivity growth has been on the wane—not much support for the hypothesis of automation causing mass worker displacement. The “gig” economy continues to get significant media attention, but it remains a small fraction of all jobs—estimated to be 0.5 to 1.0 percent of the workforce. The Labor Department recently released the Contingent Worker Survey after a hiatus since 2005. The share of workers that engage in alternative work, including independent contractors and temp workers, did not change—estimated at 10.1% in 2017 compared to 10.7% in 2005. The vast majority of the workforce continue to work in traditional employment situations
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