Unions: A Busy Month at Three Large Companies, with Two More That May Get There Too

In the six weeks since I posted on labor unions’ resurgence, there has been a flurry of news.

This headline firm, as reported by Ken Martin in Fox Business on August 12^th, has a problem, namely “Amazon worker deaths in New Jersey under investigation.”  In the month before the article date, two employees there died clearly from workplace injuries, and a third did “potentially.”  That company has since had its second attempt in another state, as “NY Amazon workers file for union election” (Haleluya Hadero, Associated Press, published in Times Herald-Record on August 18^th), adding to Staten Island the Albany-area town of Schodack.  Issues here included “better training,” and, this time, money, as a spokesperson said they had workers “unable to even make it to work because they can’t afford gas.”  The election, if approved by the National Labor Relations Board, would also be under new-and-growing Amazon Labor Union auspices.  Sad.

On August 5^th, CNBC published a general update, “Unions are forming at Starbucks, Apple and Google.  Here’s why workers are organizing now,” by Katie Schoolov.  The first firm, though starting later than Amazon, has had the most locations with recent union activity, as the number of Starbucks coffee shops greatly exceeds that of Amazon offices and warehouses.  The Apple and Google efforts are “slower,” but Starbucks is jumping ahead, and baristas, to name those of one job title, “want a boost to the current starting salary of $15 per hour, more staffing where it’s needed and more say over their schedules,” along with “better benefits,” including “more comprehensive mental health benefits as well because working during a pandemic has been enormously stressful.”  In more specific news, we have “Starbucks accused by union of retaliation over closure of two locations” (Aislinn Murphy, Fox Business, August 23^rd), these being in Missouri and Washington State and officially shuttered “over safety concerns,” and “Starbucks illegally withheld raises from workers at unionized stores, National Labor Relations Board complaint alleges” (The Washington Post, August 24^th).  Unpleasant. 

A 530-location grocery store chain is joining the multiple club, as “Trader Joe’s Workers Vote to Unionize at a Second Store” (Noam Scheiber, The New York Times, August 12^th).  This one’s in Minneapolis, joining one in Hadley, Massachusetts, with filing completed by another in Colorado.  They also have their own union, Trader Joe’s United, and have been spurred by dissatisfaction with pay, benefits, and a lack of “protocols or systems in place to handle certain emergencies,” especially in urban settings. 

To reinforce things I wrote about last month, we can see what’s happening here.  With labor in high demand, more and more employees not getting satisfaction with issues are choosing to stay and fight.  I don’t know the histories of how these problems moved from mentioned to causing an elaborate, lengthy, and charge-carrying process, but suspect that unionization was not the first step.  The safety issues are those generally resolved in American workplaces 30 years ago or more.  The monitoring, regulating, and often worker-squeezing ones may be out of line with our current economy, if not simply unreasonable.  The organizing has come so quickly that many companies have doubtless not been able to change quickly enough.

But here are two with no choice.  I wondered why certain shipping company employees dressed as if they were in the tropics; by reading “UPS Drivers Say ‘Brutal’ Heat Is Endangering Their Lives” (Livia Albeck-Ripka, The New York Times, August 20^th) I found out.  Apparently an issue shared by Fed Ex and to some extent with the United States Postal Service, the results of the problems, including dehydration and heat exposure with in-vehicle temperatures way over 100 degrees, have included paramedic visits, hospitalizations, and even deaths.  United Parcel Service management is providing the likes of “cooling towels,” “water, ice, electrolyte replacement beverages and fruit,” along with more installed fans, but they will find out soon that that is not enough. 

UPS faces two choices – put air conditioning in all of their “smaller delivery trucks,” none of which have it, or face a blizzard of not only successful lawsuits but a great increase in unionization there, which has about half of its workers represented leaving 200,000 more.  Worse could be coming for FedEx, which has no drivers at all in unions.  If they do not want to turn up in articles such as the above, along with drawing bad public relations, UPS and FedEx will need to end this embarrassing situation.  Here, once again, decisions to unionize will not be made by the workers.

Jobs Quantitative and Qualitative – Numbers and Generations

Yes, there is more on this topic, some basic until you look underneath it.

When we read that “U.S. employers posted 10.7 million job openings in June, reflecting continued strength in the labor market with some signs of cooling” (The Washington Post, August 2^nd), we might think that this decrease of a few hundred thousand means fewer good opportunities.  If anything, it means the opposite, that this mass of help-wanted listings is shrinking as deservedly-frustrated companies are filling them by paying current market rates.  As I wrote ten years ago in Work’s New Age, job ads no longer mean job hiring – with AJSN-documented latent demand hanging at around 17 million, that problem is even worse now.  As I have maintained since 2012, these so-called offerings, at least the sincere ones, will disappear with wage increases and removal of former wish-list attributes which have morphed this century into requirements. 

It makes some but not complete sense to be glad that “With Surge in July, U.S. Recovers the Jobs Lost in the Pandemic” (Lydia DePillis, The New York Times, August 5^th).  True, there are as many American positions as there were in February 2020, but we haven’t yet got back to where we were going, forecasted to be a substantial net increase in the past 29 months.  Indeed, per “Can a hot but smaller labor market keep making gains in participation?,” by Lauren Bauer et al. in Brookings on August 4th, “pre-pandemic projections” had us adding, by now, “roughly three to three-and-a-half million workers.”   Efficiency marches on, and Covid-19 showed plenty of employers how to manage with fewer workers.  As well, it is worth noting from the DePillis piece that adjusted unemployment now matches that month’s 3.5%, and it and the total number of positions may well have more improvement ahead.

We know people born in the 1980s and 1990s had fewer economic opportunities in their youth, and, according to Derek Thompson on June 13^th in The Atlantic, we are now seeing “The End of the Millennial Lifestyle Subsidy.”  The author’s idea was that this generation had the heaviest use of “Uber, the Uber-for-X clones, and that whole mosaic of urban amenities in travel, delivery, food, and retail that vaguely pretended to be tech companies,” as “almost each time you or I ordered a pizza or hailed a taxi, the company behind that app lost money,” meaning these firms “were paying us, the consumers, to buy their products.”  Thompson ran off eight concerns someone might use in one day, with total losses of “about $15 billion in one year.”  With less venture capital, higher interest rates making other loans more expensive, and supply chain problems causing “higher prices, higher margins, fewer discounts, and longer wait times for a microgeneration of yuppies used to low prices and instant deliveries,” the author opined, the change may be permanent, especially since, as I see it, these types of businesses have never been profitable.  So, what can millennials and other customers say, other than “it was fun while it lasted”?  At least they are in a fine job market.

Many of the following cohort and those close to it are old enough to start turning up in good-job workforces, and in this time of low unemployment are making themselves heard, as “Gen Z Knows What It Wants From Employers.  And Employers Want Them” (Alyson Krueger, The New York Times, July 31^st).  People interviewed here valued L.G.B.T.Q. identity incorporation, employer acceptance of “piercings, tattoos, and colored hair,” opportunity to have remote shifts and a “four-day workweek,” mental health benefits, access to private clubs and company-owned social houses, and, showing that not all of their desires are peculiar to their generation, “career growth opportunities.”  There is no guarantee they will have the same wishes in 2032, but for now, organizations looking for more young-adult workers should consider fulfilling them.

After-school paid work for high-school students was big in the 1970s and before, but has since ebbed and flowed, hurt by economic downturns and college-admission apathy.  This July 31^st New York Times piece, “The Best Extracurricular Is a Job” by Pamela Paul, named real reasons why it would be good for it to come roaring back.  She didn’t mention that some universities are now giving credit for applicants’ paid positions, but named “8 valuable things” she, a recent high-school graduate, got from them.  They were discovering that “being good at school doesn’t mean being good at work,”  “being fired isn’t the end of your career – and neither is quitting,” “you learn what it’s like to make minimum wage,” “you’re being paid for your time,” “promotions aren’t automatic,” “bosses can behave badly,” “being in a workplace means working with people who aren’t like you,” and “not everyone is as lucky as you are.”  Not only a first-rate antidote to younger people’s entitlement and insularity, but gets them money too.  I heartily endorse it.

Too Bad the Fed Has Only a Hammer – Inflation Isn’t a Nail This Time, and We’re Flourishing

There is a real problem understanding our economy out there, even among people whose knowledge is supposed to be nuanced.  Here are titles of articles published on August 5^th, after that day’s tremendous jobs report:  “Unemployment Heads in the Wrong Direction for the Fed” (Jonathan Levin, Bloomberg.com); “Markets will be in for a ‘rude awakening’ following jobs report, economist warns” (Talia Kaplan, Fox Business); “Good News on Jobs May Mean Bad News Later as Hiring Spree Defies Fed” (Jeanna Smialek and Jim Tankersley, The New York Times); “The Fed will have to ‘break this economy’ to tame inflation after the strong jobs report, Mohamed El-Erian says” (Phil Rosen, Business Insider).  The wrong track was awfully crowded.  The only points go to Ben Casselman, for “How This Economic Moment Rewrites the Rules,” in the August 6^th New York Times. 

What’s really going on?  It’s simple, and not bewildering at all.  The root cause of our economy’s state is way-high demand, from people cooped up and accumulating money during peak pandemic time and often additionally unable to buy because of manufacturing and supply-chain problems.  These eager consumers, when things cost more but what they want is available, are taking the push and buying anyway.

All of that, along with higher world demand for oil, makes prices go up, and, as more and more labor has been needed to produce and sell things, it has vastly increased the number of jobs.  We have too much money chasing too few goods and services, and too much demand for labor chasing too few workers, not to mention too many businesses refusing to pay what are now market rates for it – both classically inflationary.  The economy is excellent – the only thing out of whack is supply and demand.

So what about interest rate increases?  Because demand is so much less elastic now, they won’t be as effective as usual.  Instead of cooling the economy, they will be most successful at pushing stock prices down, multiplying the interest we pay on our over $30 trillion national debt, and perhaps even creating as much inflation as they eliminate by increasing corporate costs, which can be passed along.  The best thing we can do with inflation is to leave it alone – it will drop by itself when consumers get sated.  With reduced oil prices, down from $122 per barrel to $88 at one point, and falling food costs, that is happening already, as shown by July’s 8.5% reading, the lowest since April. 

Players of the game of bridge value their hands with “high card points,” assigning four to each ace, three to each king, and so on.  It is the best single evaluation tool there today.  But, although most advancing participants learn the need to use additional factors, many do not, and their games suffer.  That is the same way our otherwise eminent observers are now failing.  If we have inflation, they always seem to want to solve it with higher interest rates.  If we have clearly short-term Gross Domestic Product shrinkage due to not enough goods and services, even amidst a mass of other favorable numbers, it must be a recession.  If our job gains have blown away our population increase all year, there is work for practically anyone who wants it, and there is so much demand for travel that airports are putting limits on how many passengers they can handle, it must be “bad news.”

All of that is thinking for novices.  We can do better.  It is time for us to not only realize what is happening, but to adjust our attitudes and policy actions accordingly.  We don’t need to break anything.  That will help us, and is not too much to ask.

American Employment Just Keeps Getting Better: Even Lower Joblessness, Double the Projected Number of New Positions, People Rejoining Labor Force With Latent Demand per AJSN Still 17.0 Million

What a jobs report!

This morning’s Bureau of Labor Statistics Employment Situation Summary, anticipated as “key” and “critical,” could have disappointed nobody who honestly wanted it to improve.  It started with 528,000 net new nonfarm payroll jobs against a published 258,000 projection.  While the unadjusted unemployment rate stayed at 3.8%, the adjusted one, after three 3.6% months, dropped to 3.5%.  There were 5.7 million people officially jobless, down 200,000, of whom 791,000 or 36,000 fewer were on temporary layoff.  Particularly positive was the count of those out for 27 weeks or longer, which lost 200,000 to reach 1.1 million.  There were about 400,000 more working than in June with 159,067,000, and 89,000 fewer unemployed. 

On the downside were the number of people working part-time for economic reasons, or keeping such while looking thus far unsuccessfully for full-time opportunities, which gained back 300,000 of its 700,000 June fall to 3.9 million, and average hourly private nonfarm payroll employees’ earnings, which, although the highest percentage increase in years, remained below inflation with a 19-cent gain to $32.27.  The two measures of how common it is for Americans to have jobs or be one step away, the employment-population ratio and the labor force participation rate, increased 0.1% and decreased the same amount respectively to end at 60.0% and 62.1%.  

The American Job Shortage Number or AJSN, the Royal Flush Press metric published for 10 years showing how many more positions could be easily filled if all knew they were as easy to get as running an ordinary errand, was almost unchanged – up 23,000, as follows:

No category’s contribution to latent demand changed more than 78,000.  Compared with July 2021 the AJSN has dropped three million, with almost 90% of that from lower official joblessness.  The share of the AJSN from those unemployed edged down 0.4% to reach 33.0%, again less than one third. 

Per the New York Times, the 7-day average of new Covid-19 cases increased 26% from June 16^th to July 16^th to 130,170.  Other daily pandemic numbers had similar changes, with the same average of deaths up 32% to 424, hospitalizations up 35% to 40,611, and number of vaccinations administered down 25% to 233,440.  The worsening coronavirus is an increasing cause for concern, but is still well short of indicating that people are being imprudent by working. 

So what really happened?  People, though fewer than in the previous month, rejoined the workforce and, this time, consistently got jobs.  Over 15% of those reporting they were officially unemployed long-term in June had lost that status by July.  Adjusted joblessness got even lower.  Pay almost caught up with inflation.  More people, over 80,000, left the institutionalized, armed services, and off-the-grid category above, which has shed an amazing and telling 2.3 million, or almost one quarter, in the past year alone.  Workers are coming back, and they are finding success, hours, and more money.  Accordingly, the turtle strained legs as he took a lengthy step forward.