THE LAYOFF LAMENT PRECEDED TERRORISM
BY JULIANNE MALVEAUX
New York City says its needs billions of dollars of federal funds to
recover from the terrorist attacks of September 11. Washington, DC is asking
for a more modest bailout, of $750 million, to help the city through lost
tourism, low hotel occupancy rates, and fewer jobs. The airlines want money
and so does everyone else. And, so far, everyone is getting it but workers.
If you had not been paying attention, you’d think that 9-11 wrecked havoc
on our labor market. But last week’s report from the Bureau of Labor
Statistics says the downward slide in our employment situation began weeks
before terrorists toppled the Twin Towers. Payroll employment fell by
199,000 between August and September, well before the airlines said they’d
lay off about 100,000 people. Daily, there are reports about new layoffs.
After announcing 32,000 job cuts earlier this year, Motorola announced on
October 10 that that they were cutting another 7000 jobs. On the same day
that Motorola upped its job cut ante to 26 percent of the total labor force,
Goodyear Tire and Rubber Company said they’d cut 1400 jobs at their five US
plants. With a labor force of more than 135 million people, a few thousand
jobs here or there don’t seem to make much of a difference. But every job
lost has an impact both on other employment and on consumer confidence, so
the daily layoff litany can’t help economic recovery much.
The multiplier between airline jobs and other jobs in the tourist
industry is something between 3 or 4 to 1. That means that for every flight
attendant or pilot laid off, there are three or four other works, usually
less advantages, also pushed to pounding pavement. Food service and retail
service workers in airports, hotel service workers, and tour guides all take
a hit when fewer people move around. But if we are honest, we’ll acknowledge
that air traffic is not only off because people are afraid of flying. Before
September 11, some companies had asked their employees to curtail travel
because they weren’t sure which way the economy was blowing.
Others who specialized in conferences, tourism, and hospitality wondered
whether their sector would weather pessimistic prognostications. When the
level of economic growth drops from 5 percent per quarter to something under
one percent, the macroeconomic numbers don’t say “recession”, but the micro
numbers suggest such a relative fall in income that words like “recession”
are useless in capturing the effect of change. The free fall that seemed to
be taking place before 9-11 was exacerbated by that day’s events, pushing a
slow drift into a sharp downturn. People are less interested in what pushed
us down than in what will provide our economy with some upward stimulus.
Unfortunately, the Congress has focused on what cities and industry will
need, but few have focused on what workers will need. Since consumer
spending represents two-thirds of our economic activity, employment levels
make a real difference in our nation’s economic health. If we really want
economic recovery, we need to put money in worker’s pockets by extending the
amount of time that people can collect unemployment benefits, by providing
re-training to workers who are being shifted from one sector to another.
Most of the industrial sectors that ask for help are asking that their
structural organizations get assistance. Few of them are asking that funds
trickle down to the lowest-paid workers in their industry. Most are saying
that they need to be saved, but few have asked whether those who are
subcontractors should also get help. Equity issues – those that deal with
minority employment or minority business development – are being swallowed in
the name of national unity. This suggests that bailout funds should only be
provided to reinforce the status quo.
If we persist in believing that softness in the labor market is only a
function of 9-11, we might decide to favor industry over individuals. On the
other hand, if we understand that those at the periphery have an essential
role in our nation’s economic recovery, then we might decide to skew benefits
toward them. The hospitality industry spills over with the low-waged –
waiters, housekeepers, bellmen, and parking lot attendants – who are
invisibly hit by the downturn. Is there favor in our system for these
workers? Is there favor in our system for those at the bottom, regardless of
the cause of their layoff?
The layoff lament didn’t start with 9-11. We can end it, though, by
extending industrial-sized bailouts to those at the bottom. Corporate
interests have lined up to have their fill at the government trough.
Shouldn’t workers have the same consideration?