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Union Decline Accounts for Much of Rise in Wage Inequality, Study Finds

The significant decline in union membership since the early 1970s explains approximately 20% of the rising hourly wage inequality among women and about one-third among men, according to a new study in the American Sociological Review.

"Our study underscores the role of unions as an equalizing force in the labor market," co-author Bruce Western, a professor of sociology at Harvard University, told Science Daily. "Most researchers studying wage inequality have focused on the effects of educational stratification - pay differences based on level of education - and have generally under-emphasized the impact of unions."

Looking primarily at full-time, private-sector workers, the study found that the decline in a unionized labor force explains about 33% percent of the rise in wage inequality among men. Among women, de-unionization explains about 20%.

"For generations, unions were the core institution advocating for more equitable wage distribution," said co-author Jake Rosenfeld, a professor of sociology at the University of Washington. "Today, when unions - at least in the private sector - have largely disappeared, that means that this voice for equity has faded dramatically. People now have very different ideas about what's acceptable in terms of pay distribution."

The Great Recession Standoff: Big Business vs. the U.S. Consumer

Read enough news and commentary about jobs and the Great Recession and you come to think of this dire stretch in U.S. economic history instead as the Great Standoff between the American consumer and Big Business.

Big Business, which is sitting atop record-breaking profits, won't spend – e.g., hire any of the 25 million unemployed and underemployed Americans – until demand for its products and services improves.

And the American consumer – battered by joblessness, underemployment, underwater mortgages and steep consumer debt – simply no longer has the financial wherewithal to create the demand big business is holding out for.

It's been this way for roughly three years, and neither side is blinking.

Although it's not yet exactly the hue-and-cry it should be, more experts seem to be stepping forward to argue that it's now is the time for business to step up and take some responsibility for getting America back to work.

"I am coming more and more to think that with the government essentially paralyzed for the foreseeable future, the only way we’re going to get jobs is by turning to actual job creators: business itself," op-ed columnist Joe Nocera wrote in today's New York Times. "With all their cash, companies shouldn’t be waiting for Congress to give them tax incentives to hire people. They should be trying to jump-start the economy — and fend off another recession — by making investments, and hiring workers, that will lead to renewed prosperity."

Michael Useem, professor of management and the director of the Center for Leadership and Change Management at the Wharton School of the University of Pennsylvania, recently proposed an even more specific plan The Washington Post.

Useem called upon leading business organizations such as the Council of Institutional Investors, the National Association of Corporate Directors, the Business Roundtable and the U.S. Chamber of Commerce to "rewrite the rules ... of widely accepted views of investor capitalism" and place "long-term collective growth and employment security back in their mission statements.

"Working together, an inner circle of leading executives, directors and owners could help rewrite the rules most tangibly through direct actions," Useem continued. "Two come quickly to mind: 1) Creation of 1 million new U.S. jobs within the next year by the companies they lead or in which they invest. 2) Creation of a research and development fund for innovative ways to expand employment among companies they represent or own.

"Given the billions in cash that many companies have accumulated at home and abroad, the wherewithal for both is already in the bank."

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Today's Titans of Industry Should Follow Henry Ford's Lead (job-search-torture-blogspot.com)

Republican-controlled Congress more intent on tax cuts than jobless benefits extension (job-search-torture-blogspot.com)

It's not a recession that consumers can end

"Even corporate leaders have to realize at some point that their companies will not remain profitable if the people no longer are able to buy anything. A rising tide may lift all boats, but the rising ocean swells from the bottom, not from the top."

- New York Times reader in a story about the plunge in public opinion of Congressional members following the recently concluded debt limit debate

Top 299 CEOs' salaries could support 103,325 workers

This from Bloomberg.com, via The Week:

"Chief executive officers at 299 U.S. companies earned a combined total of $3.4 billion in 2010, a 23% increase from the year before. That amount would support 102,325 workers earning a median wage."

Nevada's and Las Vegas' Jobless Rates Fall - For the Wrong Reasons

Nevada’s unemployment rate dropped significantly in January, but not because of improving economic fortunes, but because discouraged workers have stopped looking for work or have left the state, the Nevada Department of Employment, Training and Rehabilitation announced earlier this morning.

“Unfortunately, the decrease was not driven by significant improvement in the labor market” said Bill Anderson, the DETR's chief economist. “It appears likely that some jobless Nevadans are becoming discouraged and giving up their search for work and dropping out of the labor force. In addition, given stagnant population levels, it is also likely that some Nevadans are leaving the state.”

Nevada’s jobless rate fell from a revised 14.9% in December to 14.2% in January.The unemployment rate in the Las Vegas area fell from 15.1% in December to 13.7% in January.

However, roughly 10,700 workers dropped out of the labor force in January, which was nearly the same decrease in the number of unemployed. Household employment remained virtually unchanged, the department reported.

The sobering announcement came after improving Nevada economic news in recent months. For instance, key indicators of the state’s economic well being, such as visitor statistics, gaming win and taxable sales, have exceeded expectations. A number of workforce indicators have stabilized, too, including the unemployment rate, although it's still inflated. “Not all is positive though,” Anderson said in the statement. “The recent surge in gas prices will undoubtedly affect travel to Nevada and continued pressure on government payrolls will likely offset any near term improvement in private sector hiring. It appears Nevada will continue to move sideways, bouncing along the trough of this recession for the foreseeable future.”

What Life is Really Like for Many Las Vegans Living Through the Great Recession

Although it's now a year old, this is one of the most powerful and accurate portrayals I've seen to-date about what life is like today for many Las Vegans living through the Great Recession.

Jobless rate falls, but Nevada still most unemployed state in October - for 6th consecutive month

While Nevada and other U.S. states' and regions' unemployment rates dropped in October, the Silver State still has the dubious ranking as number one in unemployment per capita in the country.

It was the sixth consecutive month the state led unemployment among in the United States. The states with the next highest jobless rates were Michigan, at 12.8%, and California, 12.4%, The New York Times reported.

And another national publication has recognized the difficulty of finding work in Sin City. Forbes.com has ranked Las Vegas the worst U.S. city for finding a job.

The hiring environment may be improving, but job seekers in cities that rely on strong economy-reliant industries should know that they may each be competing with six, seven or eight other idle workers for one advertised job, Forbes.com reported.

In arriving at its rankings, Forbes relied on figures from Juju.com, a site that aggregates job listings to arrive at its monthly Job Search Difficulty Index, which measures how tough it is to find employment in 50 major cities around the country.

"The cities that have continued to underperform rely on jobs from lagging industries such as manufacturing, tourism and construction," Juju vice president Brendan Cruickshank told Forbes.com. "Detroit and Las Vegas have improved from this time last year, but they continue have more unemployed individuals per open job than other large metropolitan areas."

Sunbelt cities like Las Vegas dominate the list of the most difficult metro areas for finding a job. Large metropolitan areas like Los Angeles, Miami and New Orleans continue to suffer as their tourism remains weak.

Although things are still tough in some areas, nationally things have improved, according to the report. "If you look back to November 2009, the average number of unemployed people per job posting was 6.5. This year it is 3.19," Cruickshank said. "This indicates that the market has gotten significantly better."

Nevada's Unemployment Rate Falls for First Time in Five Years

Nevada's jobless rate has fallen for the first time in five years, the state Department of Employment, Training and Rehabilitation reported this morning.

Joblessness decreased two-tenths of a point, to 14.2% in October over September, the DETR announced in a statement. The improvement was even more pronounced in Las Vegas, where unemployment fell from 15% in September to 14.1% last month.

"This is a clear sign that the recession's grip on Nevada may finally be loosening," DETR Chief Economist Bill Anderson said in the statement. "The number of jobs being eliminated is stabilizing, but there is no sign of major job growth on the horizon. While the decline in the rate is immediate good news, there is still a long road ahead to completely recover from the devastating effects of the recession."

The U.S. unemployment rate in October was 9.6%.

The last time the jobless rate declined was in December 2005, when the local economy was booming and unemployment decreased to 4.2%. Since then, the Great Recession has devastated Nevada's tourism and construction industries, and the state has led the nation in joblessness, bankruptcies and foreclosures. In total, 181,600 Nevadans, and 135,000 Las Vegas Valley residents were without work in October.

Republican-controlled Congress more intent on tax cuts than jobless benefits extension

Jobless benefits will run out for 2 million Americans during the holiday season unless they are renewed by a Congress that's focusing more attention on a quarrel over preserving tax cuts for people making more than $200,000 a year.

It's looking iffy at best whether Congress will renew jobless benefits averaging $310 per week nationwide that are presently claimed by almost 5 million people who have been out of work for more than six months.

An extension of jobless benefits enacted this summer expires Dec. 1, and on Thursday, a bill to extend them for three months failed in the House. Democrats brought the bill to the floor, but Republicans opposed the legislation because they were denied a chance to attach spending cuts.

Still, the looming expiration of unemployment benefits could put Republicans on the defensive since they'll expire just as debate peaks in the lame-duck session over whether to extend Bush-era tax cuts on individuals with income exceeding $200,000 or for couples making more than $250,000. The tax cuts expire Dec. 31, and Democrats oppose permanently extending the upper-bracket tax cuts, which would cost about $700 billion over 10 years. "I don't think we want to leave here having fought for tax cuts for millionaires and against unemployment insurance for those that have lost their jobs," White House spokesman Robert Gibbs said.

Every recession since 1950 has featured an extended federal benefits program financed with deficit dollars. Allowing benefits to expire in the holiday season may draw negative attention to Republicans, especially when measured against their insistence on renewing tax cuts for upper-income taxpayers.

Today's Titans of Industry Should Follow Henry Ford's Lead

Drawing on the success Model T creator Henry Ford enjoyed when he doubled his factory workers' pay to $5 a day in 1914, a Harvard Business Review contributing editor is recommending that American companies do the same today.

Well, maybe not double workers' pay, but at least share with them some of the record-breaking profits companies have enjoyed as they downsized millions of American during the Great Recession.

"This is relevant now because we're dealing with a new crisis in consumer demand," John Landry writes in an HBR blog post titled "Time for a New Five-Dollar Day. "As many have pointed out, average pay in the United States has been stagnant or declining for decades." And now, "from households to governments, everyone has big debts to pay off, so it's going to be hard to emerge from the recession.

"Everyone, that is, except companies. The flip side of stagnant worker pay has been above-average corporate profits. All the talk about highly competitive markets has hidden the fact that most companies have done quite well in the past two decades."

Landry said the recent election of more Republicans will mean even less regulation and fewer taxes for businesses, another reason they should share their largesse. Because the problem isn't with businesses, "It's with consumers" who are hurting so badly financially that they can't buy many companies' products, Landry concludes.

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