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Labor Report

Wages Stagnate as Economy Grows and Rich Get Richer

A large majority of American workers are effectively making less money now than they were one year ago, despite an economy that appears to be getting stronger.

This Washington Post article cited newly released federal data regarding the average hourly wage paid to workers in "production and nonsupervisory" positions, who account for about 80 percent of the nation's privately employed workers, according to the Bureau of Labor Statistics.

For those workers, the average "real wages" -- a measure of pay that takes inflation into account – fell from $22.62 an hour in May 2017 to $22.59 in May 2018, the Post reported. These workers saw their average hourly wages rise by 2.8 percent, but it failed to keep pace with inflation of 2.9 percent, "which economists attributed to rising gas prices," the Post said.

Some economists say paychecks should be getting bigger at a time when unemployment is low and businesses are hiring.

"This is odd and remarkable," Cornell University economist Steven Kyle told the Post. "You would not normally see this kind of thing unless there were some kind of external shock, like a bad hurricane season, but we haven't had that."

"The extra growth we are seeing in the economy is going somewhere: to capital owners and people at the top of the income distribution," Heidi Shierholz, director of policy for the Economic Policy Institute, said.

onger enforcement against employers who violate wage protection laws.

Job and Workforce Growth Push Unemployment Rate Higher in June

Analysts are citing the strong economy for a higher national unemployment rate in June, as the rate rose by two-tenths of a point to 4.0 percent, marking the nation’s first month-to-month unemployment increase in almost a year.

For the month, the number of non-farm jobs grew by about 213,000 according to the Bureau of Labor Statistics. Growth occurred largely in the professional and business services, manufacturing and health care sectors, while retail trade lost jobs. The job growth occurred despite the threat of trade wars sparked by the Trump administration’s tariff policies.

“Businesses added 213,000 jobs to their payrolls in June, another strong month of gains. Employers kept hiring even as fears grew of a global trade war. The economy has added jobs every month for almost eight years, the longest streak on record,” CNN reported.

The economy has now added jobs every month for almost eight years. Meanwhile, more than 600,000 Americans joined or rejoined the workforce in June.

“The job market is so good, many people who had previously given up looking are starting again,” CNN reported.

U.S. Senators Say Information Sharing Policy May Contribute to Wage Disparities

In an effort to combat gender and racial pay disparities, two U.S. senators have called on the Justice Department and Federal Trade Commission to reconsider a policy that allows companies to exchange detailed salary and wage data while those companies may discourage or prohibit their own employees from discussing compensation information among themselves.

Sens. Elizabeth Warren of Massachusetts and Corey Booker of New Jersey said in a letter to the federal agencies that the "safety zone" policy gives employers an unfair advantage in salary and wage negotiations, may artificially hold salaries and wages down and is likely a contributing factor in the persistent pay gaps seen between the genders and among races.

Nationally, women make about 80 cents for every dollar that men make in comparable jobs. The gender gap is slightly larger in Pennsylvania, where women make 79 cents on the dollar compared to men. Earnings disparities are even greater for most ethnic minorities.

Gender Gap Gender Gap

"As you know, many employers participate in privately commissioned compensation surveys, which provide detailed wage data organized by types of jobs and employers," the senators wrote. "Employers ostensibly use this information to offer attractive compensation to their workers."

The Justice Department and FTC implemented the safety zone policy in 1996 to shield employers from anti-trust laws while enabling them to adjust wages based on market conditions.

Just last month, Senator Tartaglione joined Gov. Tom Wolf and other Harrisburg lawmakers to introduce a series of measures that seek to end pay disparities in Pennsylvania. Tartaglione's SB 1200 would amend the state's Equal Pay Law to require employers to justify pay differentials based on bona fide seniority or merit systems, or systems that measure quality or quantity of production or sales. It also would expand the powers of the attorney general and Labor Department to pursue claims of unpaid wages on behalf of employers.

Another component of the Equal Pay package would make it illegal for employers to make workers sign a waiver preventing the workers from discussing their pay, and would make it illegal for an employer to require a prospective employee to disclose earnings history as part of the hiring process.

After Janus Ruling, Could Courts Force Unions to Repay All Those Fair Share Fees?

One day after reversing a 40-year-old precedent on union fair share fees and granting Illinois social worker Mark Janus unimpeded "free rider" status, the U.S. Supreme Court issued a decision that could ultimately force the Service Employees International Union to pay back $32 million in fair share fees it collected from Midwest home health care workers between 2008 and '14.

On June 28, the high court overturned a lower court's ruling that the home-based workers, who are compensated through Medicaid, don't qualify as a class, partly because many of them did not object to paying the union fees. The legal arm of the National Right to Work Defense Foundation represents three plaintiffs who originally filed the case in 2010 and wants the court to certify up to 80,000 workers as part of the class.

For now, the Supreme Court has ordered the 7th Circuit Court to reconsider the status of the proposed class.

The three plaintiffs initially prevailed at the Superior Court level, but returned to lower courts trying to expand the ruling. They claim they shouldn't have had to object to the fair share fees, which cover expenses incurred by the union related to collective bargaining on the workers' behalf. Rather, the plaintiffs claim, the fees shouldn't have been deducted from their paychecks without their consent.

Yet, for the years covered by the lawsuit, a prior Supreme Court precedent, 1977's Abood vs. The Detroit Board of Education, was considered the law of the land and allowed public-sector unions to collect fair share fees from non-members who nevertheless benefit from the union's collective bargaining activities.

Scranton Times-Tribune Joins Call for Raising Minimum Wage

We Need Decent WagesSpurred by Gov. Tom Wolf’s June 28 executive order that increased the minimum wage for state employees and contractors, the Scranton Times-Tribune published an editorial calling upon legislators to raise the minimum wage for all Pennsylvania workers.

Senator Tartaglione’s SB 1200 proposes to raise the minimum wage from $7.25 to $12 per hour immediately, followed by incremental annual raises that would lift the minimum wage to $15 by 2024. After then, the minimum wage would be subject to annual cost of living adjustments.

Wolf’s executive order implemented the same schedule of raises for state employees and contractors.

“Pennsylvania is among a minority of states that have not increased the decade-old $7.25 federal minimum wage since it was adopted a decade ago,” the newspaper wrote. “And it is the only Northeast state not to raise the minimum wage, even though economic data show that all of the other regional states that have raised the minimum continue to perform just as well as or better than Pennsylvania.”

June 2018 National Jobs Update

The national unemployment rate rose to 4.0% in June 2018, up 0.2% from May 2018. Over the previous month, unemployment rolls increased by roughly half a million individuals, raising total unemployment to 6,564,000. National unemployment statistics for the month are as follows:

  • Total Unemployment – 6,564,000
  • Change Over Month –   UP   499,000
  • Change Over Year –   DOWN   400,000
  • Change Over Trump Term –   DOWN   1,078,000
  • Rate Change Over Month –   UP   0.2%
  • Rate Change Over Year –   DOWN   0.3%
  • Rate Change Over Trump Term –   DOWN   0.8%
  • Rate Change Over Obama 2nd Term –   DOWN   3.2%

The labor force is the total number of employed individuals combined with the total number of unemployed individuals actively searching for work. Growth in the labor force is a sign of a strengthening economy from more people working and/or more individuals searching for jobs. From May to June 2018, the national labor force grew by 601,000 individuals, a combination of total employment* rising by 102,000 individuals and total unemployment up by 499,000 individuals as noted above.

The increase in June 2018 marks the second largest monthly increase in the national labor force since President Trump took office. Since that time, the national labor force has grown by 2.422 million individuals (unemployment -1.078 million & employment +3.500 million). While this growth is encouraging, continued improvement will be needed to match labor force growth seen over President Obama’s second term (3.955 million: unemployment -4.829 million & employment +8.784 million).

  • Total Labor Force – 162,140,000
  • Change Over Month –   UP   601,000
  • Change Over Year –  UP   1,926,000
  • Change Over Trump Term –  UP   2,422,000
  • Change Over Obama 2nd Term –  UP   3,955,000

Non-farm* jobs grew by 213,000 from May to June 2018, above economist’s projections of 195,000. Despite the increase, average monthly non-farm job growth thus far under President Trump stands at only 189,000, or nearly 30,000 below average monthly growth of 217,000 seen over President Obama’s second term. Year-over-year, the national economy has added 2.374 million new non-farm jobs, 71,000 less than the 2.445 million non-farms jobs added year-over-year in President Obama’s last June (2016) in office. These are far from the levels expected from a President who criticized growth under President Obama and said that he would be the “greatest jobs President God ever created”. Employment statistics for the month are as follows:

  • Total Employment – 148,912,000
  • Change Over Month –   UP   213,000
  • Change Over Year –   UP   2,374,000
  • Change Over Trump Term –   UP   3,216,000
  • Change Over Obama 2nd Term –   UP   10,414,000

*Total employment for labor force provided by U.S. Census Household survey. The separate BLS Establishment survey measures non-farm jobs only.

May 2018 PA County Unemployment Ranking
Seasonally Adjusted
Statewide rate = 4.5 percent

Rank County May 2018 Rate Apr. 2018 Rate May 2017 Rate
1 Chester 2.7% 3.3% 3.6%
2 Cumberland 2.8% 3.5% 3.8%
3 Adams 2.9% 3.3% 3.9%
T-4 Lancaster 3.0% 3.4% 4.0%
T-4 Montgomery 3.0% 3.6% 3.9%
6 Centre 3.1% 3.4% 4.0%
T-7 Montour 3.2% 3.5% 3.7%
T-7 Perry 3.2% 3.9% 4.2%
T-9 Bucks 3.3% 3.9% 4.2%
T-9 Franklin 3.3% 3.7% 4.8%
T-9 Juniata 3.3% 4.2% 4.5%
T-9 Lebanon 3.3% 3.8% 4.2%
T-13 Butler 3.4% 4.1% 4.6%
T-13 Dauphin 3.4% 4.1% 4.5%
T-13 Elk 3.4% 4.1% 4.9%
T-13 Susquehanna 3.4% 4.1% 4.7%
T-13 Union 3.4% 3.7% 4.3%
T-13 York 3.4% 3.9% 4.6%
T-19 Delaware 3.5% 4.1% 4.5%
T-19 Snyder 3.5% 4.2% 4.3%
21 Allegheny 3.6% 4.3% 4.8%
T-22 Berks 3.7% 4.2% 4.9%
T-22 Bradford 3.7% 4.4% 5.0%
T-22 Warren 3.7% 4.6% 5.3%
T-25 Clarion 3.8% 4.9% 5.8%
T-25 Northampton 3.8% 4.6% 4.9%
T-25 Washington 3.8% 4.6% 5.3%
T-25 Wyoming 3.8% 4.3% 5.2%
T-29 Blair 3.9% 4.2% 5.3%
T-29 Lackawanna 3.9% 4.7% 5.1%
T-29 Westmoreland 3.9% 4.7% 5.2%
T-32 Beaver 4.0% 4.9% 5.6%
T-32 Fulton 4.0% 4.8% 5.3%
T-32 Mifflin 4.0% 5.1% 5.2%
T-32 Sullivan 4.0% 5.0% 5.5%
T-32 Wayne 4.0% 4.9% 5.1%
T-37 Bedford 4.1% 4.9% 5.2%
T-37 Columbia 4.1% 4.8% 5.1%
T-37 Crawford 4.1% 5.1% 5.5%
T-37 Lehigh 4.1% 4.8% 5.0%
T-37 McKean 4.1% 5.1% 6.2%
T-37 Mercer 4.1% 4.9% 5.4%
T-43 Jefferson 4.2% 5.0% 5.6%
T-43 Venango 4.2% 5.1% 6.2%
T-45 Greene 4.3% 5.1% 6.0%
T-45 Indiana 4.3% 5.3% 5.8%
47 Erie 4.4% 5.0% 6.1%
T-48 Armstrong 4.5% 5.3% 6.1%
T-48 Cameron 4.5% 5.2% 7.0%
T-48 Carbon 4.5% 5.4% 5.5%
T-48 Clinton 4.5% 5.5% 5.9%
T-48 Lycoming 4.5% 5.1% 6.1%
T-48 Potter 4.5% 5.5% 6.5%
T-54 Clearfield 4.6% 5.3% 6.0%
T-54 Huntingdon 4.6% 5.6% 5.9%
T-54 Lawrence 4.6% 5.7% 6.1%
T-54 Northumberland 4.6% 5.1% 5.5%
T-54 Schuylkill 4.6% 5.5% 5.9%
T-54 Tioga 4.6% 5.2% 5.9%
T-60 Cambria 4.7% 5.3% 6.4%
T-60 Luzerne 4.7% 5.4% 5.9%
T-60 Pike 4.7% 5.7% 5.9%
T-60 Somerset 4.7% 5.5% 6.1%
T-64 Monroe 4.9% 5.6% 6.3%
T-64 Philadelphia 4.9% 5.8% 6.2%
66 Fayette 5.1% 6.2% 6.8%
67 Forest 6.0% 7.1% 6.9%