News from EPI
Overtime ruling rests on flawed logic and undermines the rights of working people to get paid for their time on the job
By Celine McNicholas • August 31, 2017
On November 30th, 2016, Federal District Judge Amos Mazzant issued a preliminary injunction preventing the Department of Labor from implementing or enforcing their update to the overtime rule, which raises the threshold under which salaried workers are guaranteed time-and-a-half when they work more than 40 hours a week.
This afternoon, Judge Mazzant issued a ruling declaring the the updated rule invalid, arguing—incorrectly—that the department does not have the authority to set a salary threshold so high that it “will effectively eliminate the duties test.” This ruling is deeply flawed and undermines the rights of working people to get paid for their time on the job.
For years, as the salary threshold was eroded by inflation and congressional inaction, businesses have used the imprecision of the duties test to avoid paying overtime to low-level employees who they wrongly classify as managers or executives. By raising the salary threshold, DOL simply ensured that workers who should be entitled to overtime pay were given it.
As EPI Vice President pointed out in November, Judge Mazzant’s ruling is flawed for a variety of reasons, writing that “the salary test is not just a tool for weeding out employees who, for example, don’t do the work of engineers or architects or radio announcers; it is an independent measure of whether the employee has sufficient status and prestige to protect him or herself from abusively long hours without adequate compensation.”
Since the law was passed, Congress has allowed the Secretary of Labor to set both a salary and a duties test. The two work hand-in-hand to ensure that working people are paid for the hours they work. We hope that DOL will appeal this ruling and that Secretary Acosta and President Trump will stand up for the 12.5 million people whose rights to overtime hang in the balance.
African American and Hispanic unemployment is higher than white unemployment in nearly every state
News from EPI
August 30, 2017
While there have been state-by-state improvements in job prospects for black and Hispanic workers, their unemployment rates remain high relative to those of white workers, according to EPI Economic Analyst Janelle Jones in her latest quarterly analysis of unemployment by state, race, and ethnicity.
Despite improvements, the highest African American state unemployment rate (9.7 percent in Louisiana) in the second quarter of 2017 was almost double the highest white state unemployment rate (5.0 percent in New Mexico). In fact, the lowest state unemployment rate for African Americans (5.6 percent in Arkansas) is still higher than the highest state unemployment rate for white workers.
“Historically, the unemployment rate for African Americans is consistently double the unemployment rate for whites. It’s only when the economy reaches genuine full employment that African American unemployment rates come down to acceptable levels,” said Jones. “Policymakers, especially those at the Federal Reserve, should not slow down economic growth until the recovery reaches working people from all ethnic groups and in every state.”
Nationally, in the second quarter of 2017 African Americans had the highest unemployment rate, at 7.4 percent, followed by Latinos (5.1 percent), whites (3.6 percent), and Asians (3.4 percent).
Other key findings include:
The highest African American unemployment rate was in the District of Columbia (12.8 percent) and Louisiana (9.7 percent), and lowest in Arkansas (5.6 percent).
The highest Hispanic state unemployment rate is in Connecticut (8.9 percent) and lowest in Colorado (1.9 percent). Colorado was the only state where the Hispanic unemployment rate was lower than the white unemployment rate.
The Asian unemployment rate was highest in Washington (4.5 percent) and lowest in Massachusetts (2.1 percent).
The highest white state unemployment rate is 5.0 percent in New Mexico, and the lowest is 1.5 percent in South Dakota.
Central Valley sees rent increases in July
published on August 23, 2017 - 10:35 a.m.
Written by The Business Journal Staff
With apartment construction winding down, the Central Valley has witnessed a skyrocketing in rents.
According to RENTCafe, a nationwide apartment search website and a part of property management software firm Yardi, Stockton continued to lead regional growth in July with a 10.4 increase. However, it is no longer topping the list of the fastest growing increases in the country, with Midland, Texas at an 18.1 percent growth rate.
With approximately 500 new units delivered last year and 700 on track to be completed in 2017, Sacramento’s housing stock faces an uphill struggle meeting demand. In the meantime rents have surged by 9 percent over the year, peaking at $1,257.
In Modesto and Fresno, rents have also increased by 7 and 5.1 percent respectively.
“Development in the Central Valley isn’t as widespread as it needs to be to fully meet demand,” said Adrian Rosenberg, communications specialist for RENTCafe. “Moreover, apartment living is attracting more and more millennials and baby boomers by offering flexibility and convenience.”
A full report on the ten prices can be found at: https://www.rentcafe.com/blog/rental-market/apartment-rent-report/rentcafe-apartment-market-report-july-2017
Steadily Moving Toward Full Employment, But We’re Not There Yet
By Elise Gould
The report from the Bureau of Labor Statistics showed the economy added 209,000 jobs in July. This brings average payroll employment growth to 184,000 in 2017 so far. This level of jobs growth this year has been on trend with the average we saw in 2016 (187,000). We need to add at least 223,000 jobs per month over the next year to lower the unemployment rate to 4 percent and bring another million workers back in from the sidelines. At that faster pace, we would increase the speed at which we get to full employment. At the current rate, we are still steadily moving toward full employment.
Meanwhile, the unemployment rate fell slightly to 4.3 percent as more workers entered (or returned) to the labor market. The overall unemployment rate masks important differences for demographic subgroups. After a precipitous fall last month, the black unemployment rate bounced back up to 7.4 percent, and remains the highest level of any racial group. As is usually the case, youth unemployment remains far higher than average as well, coming in at 13.2 percent for July. Groups with typically higher unemployment rates stand to gain the most as we reach genuine full employment.
Turning to wages, year-over-year nominal wage growth held at 2.5 percent, very much in line with recent months. This is below the targeted growth rate of 3.5 percent. At the current rate of growth, it is clear that employers need to do little to attract and retain the workers they want and any significant signs of labor shortages are simply not showing up in the data. At 2.5 percent wage growth, the Federal Reserve should get the message that there is still no worrying signs of inflationary pressure from wage growth and they should keep their foot off the brake. For more on wages and other economic indicators, check out EPI’s autopilot economy tracker to see how various labor market measures would perform each month if the economy continued inching towards full employment, as it has in the months and years leading up to 2017.
Overall, this morning’s report shows the recovery continues, but with wage growth below target levels, it is abundantly clear that we have a ways to go before we reach genuine full employment—where workers including young and old, and workers of all races can fully benefit from the economy.
EDD awards nearly $1 million to help 185 laid-off food processing
workers in San Joaquin County find new jobs
STOCKTON – The California Employment Development Department (EDD) today announced that it has awarded a $989,853 grant to help retrain at least 185 workers recently laid off from food processing plants in San Joaquin County. The grant will help the former employees of Dole Packaged Foods LLC, Diamond Foods, Inc., and Meadowbrook Meat Company find new employment in local, growing occupations such as truck drivers, office clerks, industrial truck and tractor operators, laborers, and packers.
“These workers were affected by industry changes, and it’s important that they receive the training and services necessary to get back into the local workforce,” said EDD Director Patrick W. Henning. “This grant will help them gain new job skills to move into new careers in growing industries.”
The San Joaquin County Employment and Economic Development Department, through its WorkNet Employment Centers, will use the grant to provide a variety of employment and training services, including classroom and on-the-job training in administrative, truck driving and construction-related fields – all growing industries in the region.
Funding for the program comes from the federal Workforce Innovation and Opportunity Act, and is under the administrative authority of the EDD and the California Labor and Workforce Development Agency.
For more information, or to become a participating employer, contact WorkNet of San Joaquin County at (888) 512-9675.
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