Only in America

Apparently, it’s big news that California Governor Jerry Brown [ht: sm] just signed a bill that, for the first time, means farmworkers in that state will be entitled to the same overtime pay as most other hourly workers

But this is the United States. So, the law only takes effect beginning in 2019. And it will lower the current 10-hour-day threshold for overtime by half an hour each year until it reaches the standard eight-hour day by 2022. (It will also phase in a 40-hour standard workweek for the first time.) And the governor will be able to suspend any part of the process for a year depending on economic conditions.

But, still, it’s a vast improvement over what exists now—in California and across the United States.

In California, employers currently must pay time-and-a half to farmworkers after 10 hours in a day or 60 hours in a week. That only happened beginning in 1976, since before that (dating back to 1941), the California Legislature exempted farmworkers from earning any overtime pay.

And U.S. federal law is even worse. The federal Fair Labor Standards Act of 1938, which established minimum wage and overtime standards, excluded all agricultural workers, the majority of whom at the time were African American.

Even now, the amended Fair Labor Standards Act, which states that all workers (including farmworkers, except those employed on “small farms”) need to paid at least the federal minimum wage, still exempts farmworkers from the overtime pay requirements that apply to all other hourly workers.

Ah, what a country!

Chart of the day

 

According to the AFL-CIO Corporate Pay Watch, in the state of Indiana, the 2014 CEO to average worker’s pay ratio was 101:1 (for corporations in the Russell 3000) and 306:1 (for corporations in the S&P 500).

In the nation as a whole, the ratio (for corporations in the S&P 500) was 373:1, which surpassed the ratio for 2013 (331:1)—both of which were much, much higher than the ratio in 1980 (42:1).

The average CEO compensation of Russell 3000 companies in 2014 was $5,504,432. As it turns out, the industry with the highest CEO pay was Tobacco Products ($13,061,671), followed by Railroad Transportation ($12,526,083), Petroleum Refining ($12,502,981), Communications ($10,769,054), and Hotels ($10,058,029).

As for the Security and Commodity Brokers, Dealers, Exchanges, and Services industry (where financial institutions like Goldman Sachs are located), the average CEO pay was “only” $8,102,970—ranging from $105,295 (for Joe Mansueto of Morningstar) to $88,518,411 (for Mario J. Gabelli of Gamco Investors, Inc.).

Clearly, a large portion of the surplus workers create ends up in the pockets (and portfolios) of the CEOs of the nation’s largest corporations.

Cartoon of the day

Special mention

 

Cartoon of the day

Special mention

 

Chart of the day

While a special compensation committee of the University of Kentucky Board of Trustees met Tuesday to discuss whether or not to increase President Eli Capilouto’s salary, which is currently $615,825, the Lexington Herald-Leader discovered that the UK president’s pay increased an average of 9.7 percent each year over the last decade, eclipsing the average annual tuition increase of 7.3 percent and far outpacing the average faculty and staff pay increase of 2.1 percent.

In 2012, analysts at the financial management firm Bain & Company wrote in a white paper for its clients about administrative spending in higher education,

Boards of trustees and presidents need to put their collective foot down on the growth of support and administrative costs. Those costs have grown faster than the cost of instruction across most campuses. In no other industry would overhead costs be allowed to grow at this rate—executives would lose their jobs.

As colleges and universities look to areas where they can make cuts and achieve efficiencies, they should start farthest from the core of teaching and research. Cut from the outside in, and build from the inside out.

The problem, of course, is that the presidents of colleges and universities are the ones benefiting from the increase in administrative spending.

Chart of the day

According to a new study by Carl Van Horn, Cliff Zukin, and Allison Kopicki [pdf], for the John J. Heldrich Center for Workforce Development,

nearly 30 million people — say they were laid off from a job in the past five years. Nearly 4 in 10 of these laid-off workers say they searched for a job for more than seven months before finding another one; one in five workers laid off during the past five years never found another job (see Figure 1). Of those who found another job, one in four say it was a temporary position.

Moreover, laid-off workers who found another job seldom improved their financial situation: two-thirds say their new jobs either paid less than their previous one (46 percent) or paid the same (21 percent). It’s no surprise then that nearly half of the reemployed workers say their new job was a step down for them compared to what they were doing five years ago. Just a quarter say their new job was a step up and only a third say they are receiving higher pay.

Chart of the day

As evidence of the “coming student loan apocalypse,” Shahien Nasiripour provides data about the astounding growth in student loan debt. As you can see in the chart above, average federal student loan debt per borrower has risen more than 50 percent between 2007 (when it was $18,233) and 2014 (now $27,481).*

That’s what students (and their families owe). By way of comparison, in terms of ability to pay, what’s happened to workers’ pay in the United States during that same period? Well, it’s only gone up (in nominal, not real, terms) 16 percent (from $702.40 in July 2007 to $843.50 July 2014).

In other words, students and their families’ ability to service their student loans is falling further and further behind the amount of debt their forced to take on in order to pay for their education.

Something has to give. . .

 

*Total federal student loans have grown even more: by an extraordinary 112.5 percent over that same period.