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by Richard Martin Oxman and the Oxman Collective

“The bad news: Your wages are declining. The worse news: Surveys documenting falling wage actually under-estimate how much your wages are declining.” — the opening to Pete Dolack’s You Are Working Harder And Getting Paid Less

There’s something that can be done about what Dolack is complaining about above, but it must be done quickly, and the effort must follow a fresh paradigm for movement in solidarity.

Around the middle of May in 2014, The New York Times reported on appalling labor conditions in the construction of New York University’s new satellite campus in Abu Dhabi. NYU said it had a commitment from both the government of Abu Dhabi and the contractor, the BK Gulf Corporation, that workers would be treated decently. But the Times found that migrant workers from South Asia were crammed fifteen to a room, paid as little as $272 a month for an eleven- or twelve-hour workday six or seven days per week, and were roughed up, fired, jailed, or deported if they complained. Sexual assault was impossible to report.

I did a lot of my doctoral work at NYU, and have a number of contacts to this day. They all tell me that Washington Square officials were off-the-charts embarrassed at the time, and issued pained statements of dismay that seemed to be quite disingenuous, the university’s position boiling down to “Who, me?”

NYU could disclaim responsibility because the contractor, not the university, was the employer. Keep in mind the fact that the Washington Square entity is considered a prestigious educational institution as you go through the entirety of this article. Leading the way for our youth of tomorrow.

A year earlier, in Bangladesh, more than 1,100 garment workers were killed in a factory collapse at Rana Plaza. The fashion brands for whom the clothes were ultimately made, companies like Benetton and Tommy Hilfiger, issued similar denials of responsibility. The clothes carrying their labels were produced at three or four levels of remove from corporate management. Ditto for the dynamic in the Dhaka destruction by fire in 2012.

In the new economy of “supply-chain” production, a fashion company typically hires a logistics firm such as the Hong Kong-based Li & Fung, which in turn finds factories to manufacture the goods. This is a very profitable entity dear to the hearts of many high profile celebrities securing profit with new lines of clothing, perfume, etc.

In that realm, profit margins are thin and competition for orders is fierce. No, FIERCE. The factories often turn to subcontractors. While the brand is relentless about design specifications and quality control for the product, wages and working conditions are somebody else’s problem. After the fire and the collapse spotlighted above, some European fashion houses took the lead in negotiating an accord that addressed safety, but not wages. And only that while they were in the spotlight.

The same system of outsourced employment increasingly operates at home. In the past generation, there has been a drastic change in how work is organized. Regular payroll employment is becoming the exception. The employer of record is no longer the corporation, but a web of intermediaries. The outside contractor demands stringent worker performance, even as it drives down wages, job security, and benefits. Sweatshops Are Us? [More and more, YES.]

A monumentally important authoritative book, The Fissured Workplace: Why Work Became So Bad For So Many and What Can Be Done to Improve It, just came out in paperback, and it provides worthwhile commentary on what I’ve touched upon above:

“As major companies have consciously invested in building brands and devoted customers as the cornerstone of their business strategy, they have also shed their role as the direct employer of the people responsible for providing those products and services.”

This system, which began in peripheral occupations such as janitors or security guards, has become pervasive. FedEx workers wear the company’s uniforms, drive its trucks, and adhere to stringent rules; but they are independent contractors, not company employees. At many leading hotels, room cleaners and desk clerks actually work for management companies, not for Marriott or Hilton. The technician sent by Comcast to fix your cable may well be a freelancer, not an employee. When you go into a government building, the receptionist/guard is likely not a civil servant, but the low-wage hire of a security firm. That firm, in turn, is likely to be owned by a private equity company.

Apple employs some 63,000 directly, and more than 750,000 in a variety of contract relationships. When horrific working conditions were revealed in a Chinese plant that made iPhones and iPads, Apple — one of the world’s most exacting companies when it comes to technical quality — could blame the contractor. Even when a number of suicides among workers was made known.

By “fissured,” David Weil, author of that 2017 paperback, means fragmented, as in the fissuring of a rock or an atom. The term may strike some readers as an odd usage, but the metaphor is exact. Weil points out that the fissuring mechanisms include not just the familiar categories of temp and part-timer, but “subcontracting, franchising, third-party management, outsourcing” that allow a corporation to fragment employment yet — generally — maintain standards.

Maintaining standards does not apply in the area of education where this dynamic is now being implemented across the board, across the entire nation, and we’re beginning to see a drop in standards in other realms of late.

Half a century ago, at the peak of the postwar boom, large employers took direct responsibility for their workers. Today, Weil reports, about one worker in three is hired not by the corporation identified with the product but by someone else, and the connection between employer and employee is fractured. Large corporations “have it both ways,” Weil writes:

“While a major restaurant brand may set out standards and guidelines that dictate to a minute degree the way that food is prepared, presented, and served, and specify cleaning routines, schedules, and even the products to be used, it would recoil from being held responsible for franchisees’ failure to provide overtime pay for workers, for curbing sexual harrassment of workers by supervisors, or for reducing exposure to dangerous cleaning materials.”

This new system frees corporations from the obligations of a tacit social compact in which employee loyalty is reciprocated, companies have an incentive to invest in workers, and people can look forward to predictable careers. Moreover, the entire structure of worker protections and benefits legislated beginning in the New Deal is predicated on the assumption that the employee is on the payroll of the company that makes the product. This is all elaborated on beautifully by Katherine V. W. Stone in her From Widgets to Digits: Employment Regulation for the Changing Workplace (Cambridge University Press, 2004).

A casual worker has fewer rights, and those that carry over are harder to enforce. A contract worker or temp pays his or her own Social Security taxes, can seldom collect unemployment compensation, rarely receives company-provided health insurance or pension benefits, and has scant opportunity to organize or join a union. Such workers are more likely to experience wage theft, sub-minimum wages, overtime violations, working conditions that violate health and safety laws — and have less practical recourse to legal remedies. “The modern employment relationship,” Weil writes, “bears little resemblance to that assumed in our core workplace regulations.”

As inequality has drawn increased public debate, Thomas Piketty’s  influential work and Why Don’t The Poor Rise Up? contributing immeasurably to the back and forth (if absorbed together), the changing conditions of employment have gotten far too little attention. Work remains the prime source of income for most people. The fissuring of work, Weil finds, is one of the main factors in the widening gap between productivity and earnings because it allows corporations to batter down labor costs — people’s paychecks.

In explaining inequality, many economists emphasize the importance of education and technology, contending that widening gaps reflect shifts in the demands for skills and the failures of America’s educational system (See Claudia Dale Goldin and Lawrence F. Katz, The Race Between Education and Technology published by Belknap Press and Harvard University Press in 2008).

Yet the old postwar social compact calling for far greater equality was respected at a time when most Americans did not go to college and many factory workers had not completed high school. Since 1980, college graduation rates have soared yet inequality has increased. Generally, it has widened among college graduates, not just between those with college degrees and those with only high school diplomas or less (See Josh Bivens et al., “Raising America’s Pay: Why It’s Our Central Economic Policy Challenge,” Economic Policy Institute, Washington, D.C., June, 2014).

Students — our future workers — need to join hands in solidarity with the workers I’ve spotlighted above… for many reasons, some of which are highlighted by Julian Vigo in a recent article.  For inequality is leading to indentured servitude across the board now. The movement in solidarity cannot be organized along traditional lines, but — rather — must recruit participants in a new way.

The way to begin, though — prior to working out all the nuts and bolts required — might be to appeal to today’s singular common interests among laborers and students, and blend in medical professionals to the mix, along with the vast numbers of citizens screaming about incompetent, insufficient, inaccessible and unaffordable healthcare.

The word has been out for quite some time with regard to the capitalist system. We do not really need additional documentation about its downsides, the need to reverse our momentum. What we absolutely need is DOING something about the status quo, the historical hole we’ve driven ourselves into. If it wasn’t such a serious matter, I’d say that it’s hysterical that so many highly educated and deeply experienced and well-meaning souls continue to pour their collective heartbeats into documenting, discussing, debating and demonstrating as they do… diverting the general public from DOING something about declining income, health, etc.

One must be open to all viable options, but I recommend that serious consideration be given to embracing a focus on carving out immediate inroads on the gubernatorial level, if we’re working within the United States to make a difference. Please contact me if you’re interested in elaboration. ASAP, please.

If I receive sufficient positive response from readers, I’ll provide a Part II to this piece post haste.  Economists Eileen Appelbaum and Rosemary Batt have provided a comprehensive examination of the private equity industry, which is intimately intertwined with the injustices cited here, and — all else being equal — I’d probably use their instructive delineation as a point of departure for further insights into what’s coming down today.

Richard Martin Oxman has been an educator for half-a-century, and an activist for longer than that. This piece could not have been written without the invaluable input of Robert Kittner, Rachel Oxman, Valeria Ruselli, Rachel Olivia O’Connor and Annapurna Tosca Sriramarcel. Members of the Oxman Collective can be reached at aptosnews@gmail.com.

 

One Comment

  1. K SHESHU BABU says:

    Students are the ‘ energy ‘ of any society…. If they are properly trained and given lessons on present sorry state of afairs, they can be more than useful for a future welfare society