Extremely interesting report from PBS’ Nightly Business Report; pretty objective and unbiased, so you get all sides of the discussion:
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Work In Progress - Workplace Risk
Thursday, May 25, 2006
DARREN GERSH, NBR CORRESPONDENT: Leeann Tiedt has been a home health care worker for a year. She’s a single mom, working part-time to support three children. She make about $9 an hour, that’s if her clients aren’t sick or out of town.
LEEANN TIEDT, HOME HEALTH CARE WORKER: Oh yes, it’s very difficult, very difficult right now. It’s a struggle sometimes. You have to omit certain things, or stuff like that.
GERSH: And one of those things this health care worker is now omitting is health insurance. Premiums have doubled in the last five years, and could soon cost her employer, independent living, more than it pays out in wages.
RITA GIOVANNONI, CEO, INDEPENDENT LIVING, INC.: It’s a tragedy, it’s wrong. It isn’t what should be happening in a community.
GERSH: To some analysts, the erosion of benefits is a sign the American workplace has become more insecure and employees are shouldering more economic risk on the job. Another sign: over the last five years, temporary work accounted for 10 percent of all private sector job growth.
JARED BERNSTEIN, ECONOMIC POLICY INSTITUTE: One of the things we see employers doing now is treating their workforce more like inventory. We call it just in time inventory employment. That is you staff up when demand is spiking and you staff down when demand falters.
GERSH: It’s one of the odd outcomes in our economy: Economic growth is higher on average and recessions shorter than they have been in decades, but many people feel more insecure? To many economists it doesn’t make sense.
BERNSTEIN: Unless you want to argue that it’s that very insecurity that’s fueling the growth in the flexibility, that by dint of deregulating, globalizing we have a more insecure workforce, but those very insecurities drive faster growth. But I don’t think that’s the kind of economy we want to build.
Although the impact of insecurity is low for low pay, low skill jobs, insecurity has a large productivity cost in high pay, high requirement positions – not only direct (productivity losses due to hiring process), but also indirect (reduced productivity due to stress and anxiety). And if we want to keep our quality of life, we want to build an economy on the shoulders of better paid jobs, not on cheap labor.
GERSH: Other analysts agree health insurance is in a crisis caused by rising health care costs, not just employers pulling the plug on job security. Flexible arrangements can be considered a strength of the American economy. Other countries may offer lifetime employment with secure benefits, but in those countries it’s much harder to find work. In the U.S. unemployment is lower, and job satisfaction is high, in part because people can leave jobs they don’t like and find others.
DAVID AUTOR, PROFESSOR OF ECONOMICS, MIT: So there are tradeoffs. It would be great to have both complete employment security and always be able to find a new job when you need one. But by and large those two don’t seem to go together. The upside of flexibility is that it makes it easy for people to find jobs. The downside is they may not keep them as long as they would like.
GERSH: But that doesn’t mean everyone has the same job security they used to have. A college educated man certainly faces more competition – including overseas competition – than his father might have a generation ago. But a college-educated woman today has a much more stable career than her mother could ever have dreamed of.
DAVIS: Part of this sense of the rising insecurity of jobs is the people who thought they had a secure, stable job, many of them found out, no they didn’t. So there’s that failure to meet expectations.
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