Unemployment Statistics Miss Informal Labor

Unemployment Statistics Miss Informal Labor

“Reported high rates of joblessness among black men with little education obscured the fact that many of these men did regularly work, if not in the formal labor market,” writes Matthew Desmond in Evicted. Labor force participation rates are important because they inform national policies and discussions regarding the economy, society, and how we understand ourselves relative to others. What Desmond’s quote shows is that national labor force participation rates don’t capture a full picture of work, and as a result, our policies, discussions, and interpretations of the world of work may be inaccurate.
 
 
Desmond’s focus is on the way that landlords are able to access poor tenants as a form of free – or sometimes low paid – unregulated labor. Poor tenants, especially in the reporting from Desmond poor black men, are available for hire in exchange for breaks on rent or quick cash. Payments are not often up to minimum wage standards and requirements, and the work can range from relatively unimportant fence painting to crucial code compliance updates for landlords’ properties. A tenant may be hired to help paint a hand rail or may be hired to repair a roof, and when their work is under the table, then their safety can be at jeopardy. Nevertheless, as Desmond shows, informal labor is common among unemployed men.
 
 
Our welfare and assistance policies are designed so that able bodied young men must meet certain requirements before they can receive any benefits or aid. Many policies require work, community service, or job search activities before any benefits will kick in. Informal labor doesn’t count in this system, so men cannot be seen as deserving of aid if they only find work in the informal labor sector. Informal labor may help poor men get by, but it doesn’t help them get ahead.
 
 
The fact that many poor men find work within informal labor markets should tell us that these men can function within society and can find productive ways to earn money. It tells us that these men have been shut out by various structures and systems that don’t permit them to work in formal economies. When landlords come around and help get these men to a job then they do work, at least enough to get by. They don’t all do a great job once they are working, as Desmond shows in his book, but with a little help they can get started. I Think this is an important point to consider. Often the arrangements are not fair and  the work is not great, but informal labor does take place, and can tell us a lot about the people whose work is not counted elsewhere and the types of systems that could be built to reach them.

How Men & Women Experience the Threat of Eviction

How Men and Women Experience the Threat of Eviction

The poorest people in our country are often in danger of being taken advantage of or exploited. For low income renters, their need for shelter and limited housing options means that they have to negotiate deals to avoid eviction or try to work out better arrangements with more powerful landlords. In the book Evicted, Matthew Desmond shows how these negotiations differ for men and women and how these arrangements can be particularly exploitative and dangerous for women.
 
 
“Men often avoided eviction by laying concrete, patching roofs, or painting rooms for landlords. But women almost never approached their landlord with a similar offer. Some women – already taxed by child care, welfare requirements, or work obligations – could not spare the time. … When women did approach their landlords with such an offer, it sometimes involved trading sex for rent.”
 
 
Gender disparities in our nation translate into different experiences of exploitation and danger for men and women in our lowest socioeconomic ranks. Low skill and low wage men are expected to work and produce, and this expectation affords them extra opportunities to find ways to pay their rent and avoid eviction. Landlords, Desmond explains, are more willing to offer men the chance to work off late rent by providing them some form of manual labor that will help benefit the landlord and their tenants or properties. Rarely do women receive the same offers, and Desmond explains that women rarely seek out similar arrangement themselves. Various gendered norms and expectations end up making it harder for women to skate by with odd jobs at the lowest levels than men who are given extra chances, even if those extra chances are physically demanding and potentially dangerous.
 
 
Desmond’s quote also hints at another gendered norm that makes life in the lowest socioeconomic status harder for women than men. Women are expected to take care of children, if they have any, and this means they have less time and flexibility in picking up extra work for their landlord in exchange for rent. Welfare often requires that an individual spend a certain amount of time in school, searching for a job or working, or engaging with certain productive volunteer activities. Women who try to adhere to these requirements, all while caring for kids or men who did not try to meet such requirements, could not possibly take on more gig work to make a little extra cash to avoid eviction.
 
 
Finally, Desmond’s quote highlights the exploitative and dangerous reality that many low socioeconomic status women find themselves in. The gendered disparities and power disparities between these women and their landlords often means they have nothing to negotiate with for rent other than their bodies. Trading sex for rent is dangerous for the women, exploitative, and in many ways degrading. It is not the case that every individual facing eviction experiences these realities exactly as I have described them based on gender, but it is often the case that the threat of eviction manifests differently for men and women, in part due to larger gender biases that exist within our society.

Wage Theft

Wage Theft

$2.00 A Day by Kathryn Edin and H. Luke Shaefer looks at individuals in the most dire poverty in the United States to understand their history, experiences, and lives with almost no income. They provide a humanizing look at a group that is often dehumanized, and often taken advantage of. In the book, the authors discuss wage theft, what researchers use to describe violations of labor standards that harm the lowest wage workers who have no avenues for complaints or legal action against employers or gig hirers.
“If one tallied all of the losses suffered by victims of robberies, burglaries, larcenies, and motor vehicle thefts combined,” the authors write, “the figure wouldn’t even approach what is taken from hardworking Americans’ pockets by employers who violate the nation’s labor laws. And the victims are generally the most vulnerable among us.”
The claim in this quote is seems pretty huge to me and potentially a bit hyperbolic. But I believe the idea holds even if the claim itself overstretches. The lowest income people in the nation are easy to take advantage of. They are often desperate for any money or aid they can receive, with the alternative being to put up with unfair work or go with hungry stomachs or no place to sleep. This leaves the poor in a position where it is easy for someone who has hired them for a formal or informal job to make unreasonable demands on their time, effort, or wage that they cannot push back against.
Edin and Shaefer explain that wage theft can take the form of simply not paying someone the wage that was originally offered or paying below minimum wage. However, it can be even more severe, such as forcing an individual to work overtime without paying overtime rates or forcing them to work off the clock and not paying them at all. For the lowest income individual in the country, even being hard working doesn’t help them receive a fair wage, and can be a losing situation for them.
The simple answer to extreme poverty is hard work and getting a job. It is easy to tell the person on the street that they just need to work harder, need to be more persistent, and need to stick out the terrible job they can get in order to work their way up. In reality though, for those low wage individuals, the work they can find can be demeaning and can take more from them than what it gives in terms of wages. They may not get the full amount they should be owed, they may be taken advantage of in a situation that deliberately keeps them from advancing to make more money. Wage theft can create a cycle where the only work for the poor makes them worse off, leading to more spells of unemployment followed by further wage theft and exploitation. When we think about wage theft as Edin and Shaefer present it, we see that the simple answer of getting a job and working hard is not enough for many of the poorest among us to improve their situation.
Guaranteed Jobs

Guaranteed Jobs

About a year ago I read a series of books focused on homelessness and poverty in the Untied States. One take-away I had from the reading was that we need a federal guaranteed jobs program. A guaranteed jobs program would certainly be looked down upon, would not be well respected, would be criticized, but would make a huge difference in addressing deep poverty across the nation.
In their book $2.00 A Day, Kathryn Edin and H. Luke Shaefer explore the lives and realities of people living on an average of $2.00 a day in the United States. There are people in our country living a poverty so severe that many of us cannot imagine it exists within our country, yet the number $2.00 a day poor has increased recently and results from a complex set of factors that the authors explore.
One factor explored by the authors is a lack of quality and meaningful jobs for people at the lowest end of the socio-economic scale. Jobs for these individuals are often unreasonable in multiple ways. Schedules are often set at the last minute, with unpredictable and often unworkable hours. They are also often part-time, temporary, and likely to be cut at the slightest misstep. Better jobs may be available, but they may be further away than an individual living in poverty can reasonably and reliably commute to. Jobs, in other words, are not as easy to obtain and maintain as people higher up the socio-economic scale might imagine, and getting a foothold with a job to propel oneself is often next to impossible for individuals whose work future is hanging in the balance with every tiny misfortune.
Jobs provided by a government, jobs that are always available and make an effort to meet people where they are, simply do not exist. For the nation’s poorest, a job in government is almost impossible to find. The authors write, “a small group of low-skilled individuals find work at municipal buildings or in schools (perhaps as cafeteria workers or bus drivers), but prison inmates are sometimes used for maintenance and janitorial services in these places [specifically referring to the Mississippi Delta region].”
Our nation’s poorest compete for very few low wage public jobs. Part of their competition comes from prison labor, where inmates are paid less than minimum wage to work. I think these prison programs are a good thing, though I have never studied or considered them in depth. But it is notable that those in deep poverty have to compete against prisoners who make less than the minimum wage.
The only things stopping our country from developing a guaranteed jobs program is a lack of interest and stigma against the poorest of the poor. It is likely that we would not be able to find truly meaningful work for everyone who wanted and needed a job at all times, but we should make an effort to find something to do to employ the poorest among us in one way or another. There is no reason we cannot develop a program that would help meet people where they are and find something for them to do for which a wage can be provided. We have diminished the social safety net programs that help support the poorest among us, often with the argument that people should only receive such support if they are productive members of society, but we don’t make any efforts to help people become productive members of society. We don’t offer guaranteed jobs and we don’t do a lot to work with people who have not been employed for a long time to get them back into the swing of work. While some programs exist, generally we don’t find flexible ways to let people work and find pride in being part of society.
Instead, we marginalize people, criticize them for being failures, and push them to the side while blaming them for their failure. Companies and businesses are then unwilling to hire such people, reinforcing in their own minds that their failure is something inherent in who they are, driving a vicious cycle of failure, poverty, apathy, and despair. It is not a welfare program itself that drives this cycle, but the entire system and way in which we act toward such people. A guaranteed jobs program would not be perfect and would not solve every problem for every individual, but it would start to make a difference and offer some people a real way out of $2.00 a day poverty.
Informal Economies

Informal Economies

My last post was about the high costs of work and how we often fail to fully consider the high costs of work for people in the deepest poverty when we criticize them for relying on government aid for survival. This post looks at what people living in poverty do to make money when they don’t engage in formal economies or work traditional jobs. For the individuals chronicled in Kathryn Edin and H. Luke Shaefer’s book $2.00 A Day, informal work is how most of them make any money, as the costs of formal employment can make working in the formal sector prohibitive.
“The more employment in the formal labor market proves perilous – with low pay, too few hours, and crazy schedules – the more untenable it is for a parent trying to raise kids. And the weaker the government safety net, the more the informal work described here will proliferate.”
Informal work can be dangerous, hazardous, and unpredictable, but often it is one of the only options available to people in poverty who can’t get a foothold in more traditional labor markets. If you can’t afford to live near a job, if that job changes its schedules unpredictably, and if you are generally taken advantage of in a low-wage work situation that doesn’t ensure you won’t go hungry or without water or power, then why risk putting in the effort to find and maintain a job in the formal economy? Why not fall back on what little social support and government aid there is and hope for odd jobs in the informal economy instead? At least those jobs will provide some measure of autonomy, can be done close to home or with reasonable transportation provided, and at least they will pay quick cash.
This is the calculation many living in poverty face each day, but there are long term costs to relying on an informal economy. The authors write, “the replacement of a formal economy with an informal one – unregulated and unpoliced – may have a self-perpetuating effect of pushing the $2-a-day poor further and further out of the American mainstream.” Informal jobs are not enough to help people escape poverty, build skills or a resume for the future, or find stable and solid footing. Informal economies meet the immediate needs of the day sometimes better than formal jobs, but they don’t provide the stability and support necessary to plan for a future and build a road toward success.
However, as my first few paragraphs show, we cannot simply blame the individual for opting out of the formal economy for informal jobs that don’t provide long-term benefits. The formal economy can also be unpredictable, can deliberately schedule too few hours or change hours last minute, and also may not provide many long-term benefits to help someone live with any stability. These are large structural issues with the way our economic system has developed. Forces beyond an individual’s work ethic and self-control are shaping the environment, the cost/benefit calculations, and the opportunities for both formal and informal work. All of this creates a self-perpetuating cycle between informal economies and formal work for the poorest people in our country. Removing the little support that exists for the poor and criticizing them for not having a formal job and for engaging in informal economies will never be enough to improve the situation for more than a minimal percent of those living in deep poverty.
The Costs of Work

The Costs of Work

One argument that is popular against welfare and social support programs is that they discourage work by encouraging people to sit at home collecting a welfare/disability/unemployment check rather than being a productive member of society. This is an argument that is picking up steam as we start to move away from the COVID-19 pandemic, as enhanced unemployment benefits run out, and as companies have trouble hiring back employees who seemingly don’t want to return to work.
To me, as I have heard people make this argument, I think that people make a mistake in who they think are the primary beneficiaries of welfare/disability/unemployment benefits and I think they make a mistake in how they imagine people receiving such benefits actually live. I think people imagine their own lives and living standards, and transpose those onto benefits recipients, except with money coming from the government and not from a job. They see people who are just like them, enjoy the same living standards, but choosing to be lazy instead of making the sacrifices that work requires. With this vision it is understandable that people get angry and want to tear down such social support systems.
I recognize that fraud, waste, and abuse of social support systems occurs. I know there are people cheating the system to get disability insurance and that they would find a way to go back to work if their checks ran out. I also know there are people abusing food stamps programs, and I generally believe it is better for people to be working productively than watching the price is right and not trying to do something valuable for themselves and others. However, I think these arguments are often more anecdotal than factual, and I think tearing down the whole system because a few people cheat is dangerous and misguided. I think the statistics demonstrate that the programs are necessary, and I think that additional considerations regarding the cost of work should also be made to help us better understand why there are “lazy cheats” out there.
Kathryn Edin and H. Luke Shaefer do a good job examining the real costs of work and the pressures these costs place on families and individuals to rely on social support systems rather than their own industriousness. Regarding welfare in 1996, the year it effectively died to be replaced by a new system, the authors write, “Work paid only a little more than welfare but cost a lot more in terms of added expenses for transportation, child care, health care, and the like. It was more expensive to go to work than stay on the welfare rolls.”
20 years later we still have this problem, especially in large cities where economic opportunities seem to be located. The costs that people face when trying to work rather than when accepting social support program benefits add up and are impacted by many factors beyond the wage than an individual can earn. Many cities are too expensive to live in, and as a result people have to commute very long distances to get to work, and that commuting adds up in terms of time, vehicle maintenance, or transportation fares. While working and commuting, children need to be watched by someone, adding child care costs into the equation. Time spent in a car or sitting on a bus also takes away from any chance to be physically active to help ones health, potentially increasing health care costs because an individual doesn’t have time to cook a healthy meal and doesn’t have time to go to a gym or get out on a walk.
Individuals who might be prone to laziness don’t have a hard decision to make when faced with these calculations. They can lose all their time, have to pay for child care, and end up with poor health and few extra dollars to spend if they pursue work. The alternative is to accept poverty, accept government aid, and at least reduce the costs, time demands, and stress that work adds to their lives. However, I don’t think most people enjoy or want this life, and I don’t think it is anything to be jealous of.
I don’t think the answer here is simply that employers need to pay more and that the minimum wage needs to be raised. I think that can certainly be part of the equation, but we clearly also need to help people live closer to their jobs, have better affordable access to healthcare, and afford quality child care that will help their kids and keep them safe. This is an idealistic and possibly unrealistic set of policy desires, but I think that is because we have misperceptions about who uses aid, and about our roles and responsibilities as individuals within society. I think that years of focusing on ourselves as individuals has in part contributed to the erosion or lack of development of social supports that would help tip the balance for those prone toward laziness away from staying home and toward working. As it is now, we accept the high costs of work and then criticize those who opt out.
A Large Collection of Miniskills

A Large Collection of Miniskills

I  really like the way that Daniel Kahneman describes expertise in his book Thinking Fast and Slow. His description is incredibly meaningful today, in a world where so many of us work in offices and perform knowledge world. Expertise is important, but it is a bit nebulous when you think about knowledge work expertise compared to craftsmanship expertise. Nevertheless, a good concept of what expertise is can be helpful when thinking about personal growth and success.

 

Kahneman writes, “The acquisition of expertise in complex tasks such as high-level chess, professional basketball, or firefighting is intricate and slow because expertise in a domain is not a single skill but rather a large collection of miniskills.” By thinking about expertise as a large collection of miniskills it becomes more understandable and meaningful, even in the context of knowledge work. For sports, many crafts, and even physical labor, expertise as a collection of miniskills is so obvious it is almost invisible. But for knowledge work, expertise as a collection of miniskills is invisible because it is not obvious or ubiquitous.

 

The image coming to mind for me when I think of expertise as a series of miniskills is iron forging or glasswork. It is clear that one must have a lot of different skills ranging from skills related to noticing subtle changes in materials as heat is applied to physical skills involved in shaping the material once it is at a certain temperature. One also has to have imaginative skills in order to see the shape and design that one wants, and be able to connect the right twists, bends, and physical manipulations to the object to match the mental image. Forging a knife or making a glass marble requires a lot of skills in related but different spheres in order to make one final product. It is obvious that one needs a lot of miniskills to be successful, but unless we enroll in a beginners class, we don’t necessarily think about all the miniskills that go into the craftsmanship.

 

In the knowledge work economy, our final work products are also an accumulation of miniskills, even though it feels as though we just produce one thing or do one thing with no real “skill” involved. However, our work requires communication skills, writing skills (a particular variation of communication skills), scheduling and coordinating skills, and oftentimes skills that require us to be able to create visually stimulating and engaging materials. Whether it is creating a slide show, coordinating an important meeting, or drafting standard operating procedures, we are not simply doing one thing, but are engaging an entire set of miniskills. True expertise in knowledge work is still derived from a set of miniskills, but the skills themselves don’t seem like real skills, and are easily ignored or overlooked. Focusing on the miniskills needed for knowledge work expertise can help us understand where we can improve, what our image of success really entails, and how to approach important projects. It is the mastery and connection of various miniskills that enables us to be experts in what we do, even in our ubiquitous office environments.
Performance and Mood

Performance and Mood

We are in the middle of a global health pandemic, but it comes at a time when companies are starting to radically re-think the work environments they set up for their employees. I worked for a time for a tech company based out of the San Francisco Bay Area, and saw first hand the changing thoughts in how companies relate to their employees. Every day wasn’t a party, but companies like the one I worked for were beginning to recognize how important a healthy, happy, and agreeable workforce is to productivity and good outcomes as whole. The pandemic has forced companies to think even more deeply about these things, and some blend of remote and office work schedules will likely remain for a huge number of employees. Hopefully, we will walk away from the pandemic with workplaces that better align with the demands placed on people today, and hopefully we will be more happy in our work environments.

 

Research that Daniel Kahneman presents in his book Thinking Fast and Slow suggest that adapting workplaces to better accommodate employees and help them be more happy with their work could have huge positive impacts for our futures. Regarding tests for intuitive accuracy, Kahneman shares the following about people’s performance on tests and their mood:

 

“Putting participants in a good mood before the test by having them think happy thoughts more than doubled accuracy. An even more striking result is that unhappy subjects were completely incapable of performing the intuitive task accurately; their guesses were no better than random.”

 

Our mood impacts our thoughts and our thinking processes. When we are happy, we are better at making intuitive connections and associations. If we need to be productive, accurate, and intuitive, then we better have an environment that supports a relatively high level of happiness.

 

If our work environment does the opposite, if we are overwhelmed by stress and must deal with toxic culture issues, then it is likely that we will be less accurate with our tasks. We won’t perform as well, and those who depend on our work will receive sub-par products.

 

There is likely a self-perpetuating effect with both scenarios. A happy person is likely to perform better, and they will likely be praised for their good outcomes, improving their happiness and reinforcing their good work. But someone who is unhappy will likely have poor performance and is more likely to be reprimanded, leading to more unhappiness and continued unsatisfactory performance. For these reasons it is important that companies take steps to help put their employees in a good mood while working. This requires more than motivational posters, it requires real relationships and inclusion in important decisions around the workspace. In the long run, boosting mood among employees can have a huge impact, especially if the good results reinforce more positive feeling and continued high quality output. Changing work schedules and locations as forced upon employers by the pandemic can provide an opportunity for employers to think about the demands they place on employees, and what they can do to ensure their employees have healthy, safe workplaces that encourage positive moods and productivity.
Employers, Employees, and Opioids

Employers, Employees, and Opioids

One of the frustrations I have with modern day America is how frequently employers say that their greatest asset is their employees, but don’t back that statement up with actual action that helps improve the lives of their employees. Many of us work 40 hours when our work could reasonably be completed in fewer hours, alternatively many of us have incredible demands and insufficient help or time to complete our work. On the benefits side, many of us have health plans that don’t make preventative care affordable and have high deductibles and copays which place basic medical care beyond our reach. These frustrations, incursions into our non-work-lives, and a lack of support for living healthy lives are examples where employers are failing to live up to the claim that so many of them make about the care and value they have for their employees.

 

In the end, a failure to take care of employees and a willingness to let workers languish hurts the employers as much as the employees. In his book, The Opioid Crisis Wake-Up Call Dave Chase writes, “Ohio attorney general Mike DeWine estimated that 40 percent of job applicants in the state either failed or refused a drug test. The result: In certain places, solid middle-class jobs can’t be filled.”

 

On a first read, the problem sounds like it is on the job applicants. Why are so many job applicants using drugs, refusing drug tests, and unable to be hired for work? Shouldn’t they stop using drugs, get their lives together, and do the sensible things to be responsible humans and find employment? From the outside, as someone with a job who doesn’t have an opioid addiction, this is easy to say and think, but it’s also shortsighted.

 

Many of us have incredibly lengthy commutes, decimated social lives, no meaningful civic or religious organizations to give us purpose outside of work, and lack access to supportive mental health and general healthcare services. When we fall on hard times and need assistance, we don’t have a social safety net that we can fall back upon with encouragement and understanding. We feel isolated, can barely afford healthcare, don’t have much time outside of work and commutes for social or civic engagement, and if we do need welfare, the system is designed to make us feel like abject failures for turning to public support programs for help.

 

The blame can’t fall entirely on the individual. Businesses have to be held accountable as well, after all, employers count on a strong labor market to stay afloat and be productive. If they truly value their employees, they should prioritize a happy, healthy, and effective workplace by pushing back against institutions and structures in our lives that make us miserable, depressed, unhealthy, and uncommitted to the work we do. Chase’s book shows how employers are beginning to do this, by providing more services (in healthcare) to their employees and actually saving money while doing so. Employers can let their actions speak louder than their HR slogans, and can help their employees actually live healthy lives. In the end, the workforce that they rely upon will indeed be more reliable.
Making People Feel Valuable

Making People Feel Valuable

Toward the end of his book Dreamland, Sam Quinones quotes a the VP of sales from a shoelace factory in Portsmouth Ohio named Bryan Davis. Speaking of the company that Davis helps run, and discussing how Davis and a few others took over a failing shoelace company and reinvented it, Davis says, “It’s all been about money, the mighty dollar. The true entrepreneurial spirit of  the U.S. has to be about more than that. It has to be about people, relationships, about building communities.”

 

Quinones writes about how the decline of manufacturing has harmed cities across the United States. He understands why companies have relocated oversees, and in some ways accepts that businesses move and that economies change, but he sees the abandonment of American workers and the lack of supports for those workers when opportunities disappear as a major contributing factor to the Nation’s current opioid epidemic. When people suddenly lose the job they have held for years, when there is no clear alternative for them to turn to in order to feel useful, valuable, and like a contributing member of society, an alternative to ease the pain of their new reality is often pain killing opioid medications. It is an easy recipe for widespread addiction.

 

I don’t understand economics well enough to place criticism on businesses and factories that move operations to different cities, different states, or different countries altogether. I won’t criticize or praise these companies, but what is clear to me, is that we need to find ways to be more respectful of the people who work for and with us. We need to find real ways to make people feel valuable in their jobs, whether they are call center staff, healthcare workers, or a VP of a successful company. We can’t set out with a goal to make money and then withdraw ourselves from the lives of our fellow Americans and communities. We have to develop real relationships with people across the political, economic, and cultural spectrum of the communities where we live, otherwise we turn toward isolation, which isn’t helpful or healthy for ourselves or others in the long run.

 

This is the idea that Bryan Davis expressed. We can be inventive, creative, and push for economic success, but we should do so in a way that supports our community and values relationships with those around us and in our lives. If we only drive toward our own wealth and bottom line, we risk exploiting people, and that ultimately leaves them in a vulnerable position where isolation, depression, and isolation are all the more possible.