There’s a lot of talk this election year about creating jobs. In this economy, it’s clearly an important topic – especially to those who are out of work. But what many candidates aren’t talking about is the quality of jobs that need to be created.
At the Montana Community Development Corporation, there are a few core indicators that we look for in identifying a high quality job. Number one is, of course, wage level. Two is job security — are the jobs full-time and permanent? And number three is employer provided benefits such as employer contributions to health insurance and retirement. We also look for factors like work schedule flexibility, including sick leave and vacation time, and, finally, opportunities for training and advancement.
So how are jobs measuring up? Over the past thirty years, the quality of jobs in the US has deteriorated steadily. Both real wages and employer provided benefits have declined. We see it with our clients’ businesses every day. Instead of rising with the cost of living, wages have been stagnant or even lowered. And employers who previously offered health care to their employees can no longer even afford to cover it for themselves.
When we look at wages what should our benchmark for quality be these days? According to research from the Center for Economic and Policy Research more than one-fourth of jobs pay less than poverty level-wages – the amount that would allow a full-time year-round worker to lift a family of four out of poverty. In 2011 poverty-level wages were about $22,000. But that’s just enough to barely scrape by.
The organization Wider Opportunities for Women recently published their Basic Economic Security Tables or BEST, which factors in essentials like housing, food, transportation, and household items, but also health care, emergency savings, and retirement savings. They calculated that in order for a family of four with two full time workers to cover these needs, they would need total annual earnings of $68,000 per year, or $16 per hour per worker. Even at this level the family would not be earning enough to save for their children’s higher education, or build assets toward home ownership. And, according to BEST, a whopping 45% of U.S. Residents live in households that don’t meet even this basic level of economic security. Do you?
And if you’re an employer, are you able to provide this level of wages to your employees? Statistics say probably not — at least not yet. But, small businesses are known to be an important source of high quality job creation. They can provide wealth building opportunities for their owners, create more middle-income jobs and offer real opportunities for advancement. As the businesses grow, their employees are able to grow with them.
Over the past two years, we’ve seen our clients struggle to keep their businesses viable and their employees on the job. But they’ve done their best for the welfare of their employees. Some have kept all of their staff but reduced their hours and are slowly building their employees back up to full time as their businesses turn around. Others have stopped contributing to health insurance, but have maintained a group plan that provides better coverage at a lower cost than their employees would otherwise be able to access. Some have also allowed for more flexible work schedules to accommodate other employment and family needs.
And these employers are being rewarded for their attention to their employees. For example, I have a client who worked to keep all of her staff employed even as the business was struggling. When she honestly discussed the businesses’ financials with her employees, they all volunteered to donate the pay they would have received for employee training hours to a fund to save money to purchase new equipment for the business. This employer and these employees alike are working toward a more stable business with stable, high quality jobs.
As we move deeper into election season and the debates about the economy continue, I hope to hear more frank discussions about the metrics that ensure quality as well as quantity of work. And I hope that these conversations aren’t limited to the political arena, but are taken up at board meetings, staff meetings, and lunch rooms across Montana. As our economy changes, we need to keep our eye on what we want out of our working lives, now and in the coming decades. By all means let’s figure out how to create more jobs, but let’s also remember the ultimate goal — to create better lives.
Kaia Peterson writes on behalf of the Montana Community Development Corporation