Workers laboring to stay afloat - East Valley Tribune: News

Workers laboring to stay afloat

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Posted: Sunday, August 31, 2008 5:48 pm | Updated: 11:14 pm, Fri Oct 7, 2011.

Workers everywhere are patiently waiting for the economy to turn around, and hoping they can hang on and stay afloat until then. Labor Day presents an opportunity for workers to reflect on how they're managing in the current downturn.

SLIDESHOW: Hard at work

Labor score card shows workers falling behind

Gary McCormick, a plumber of 39 years in Mesa, said in all that time he hasn't seen the economy as "strangled" as it is now.

Census figures, Charts by Gabriel Utasi/TRIBUNE

"Like most people right now, we're busy one week and totally slow the next two weeks, and we've never seen it affect the economy in the area of service before like it has now," he said. "If people have the money, they don't want to spend it and most people just don't have the money. Work is precious."

Last week, the U.S Census Bureau reported that national median household income climbed 1.3 percent between 2006 and 2007, reaching $50,233. In the West, however, median household income remained unchanged.

Despite increasing worker productivity, most Americans are suffering from dwindling income, rising inequality, eroding living standards and declining expectations, according to the Economic Policy Institute's latest report, the State of Working America 2008/2009, which examines the 2000-2007 work cycle.

'POTENTIAL WASN'T MET'

"Productivity growth was strong, 2.5 percent per year, so the men and women of the work force were working more efficiently, they were working smarter and they were working harder," said Heidi Shierholz, an economist with the institute. "There was a lot of potential for people to have good rising living standards, but ... by virtually every measure of living standards, that potential wasn't met."

This was the first ever business cycle in which the share of the working population that was actually working dropped, according to the report. The decline translates to about 1.4 million people who could otherwise have been working or actively hunting for a job.

"The unemployment rate is rising, and we also see the underemployment rate rising, which means there are a lot more people who are working involuntarily part time," Shierholz said. "They want to work full time, but they're stuck in part-time jobs. You can see employers cutting back both by cutting back on entire workers and cutting back on the hours margin."

McCormick remains optimistic and knows Arizona's economy eventually will bounce back.

"It's just that right now it's killing a lot of people," he said. "We've just been keeping our fingers on the pulse, checking with our suppliers and things like that, seeing how other people are doing. And nobody's doing real well right now, you're just holding on."

Margaret Walter, an office worker from Mesa, feels "very fortunate" that she and her husband both have good jobs.

"Am I happy with the economy, obviously not," she said. "Am I happy with my job, yes, I am. I'm very secure."

Census figures, Charts by Gabriel Utasi/TRIBUNE

Other findings in the Economic Policy Institute report:

Although the economy has expanded 18 percent since 2000, income for the median family fell by 1.1 percent from 2000 to 2006.

People at the very top 10 percent of the income ladder saw much higher income growth - they made up more than 90 percent of all the growth - from 1989 to 2006.

While some income mobility exists, 60 percent of families who start in the bottom fifth are still there a decade later.

'CHANGE SOME THINGS'

"Even if the economy turns back up, what this business cycle showed us is while strong productivity growth is essential for rising living standards, it doesn't guarantee rising living standards," Shierholz said. "We have to change some things in order to reconnect this productivity to living standards in a real way."

Radical shifts in spending patterns indicate more workers are struggling financially, said Stephen Happel, economics professor in the W.P. Carey School of Business at Arizona State University.

"One thing that's very clear is ... this sharp shift of people buying food at the dollar stores and Wal-Mart, and so places like Safeway and those kind of stores are suffering right now," he said. "I don't encounter many people these days saying that they think they're a lot better off than they were a year ago."

Many Arizonans are forced to switch careers because the jobs they used to have are long gone and won't be coming back even when the economy rebounds, Happel said.

The fact that Arizona is a right-to-work state should help its economy recover because heavy unionization tends to slow recovery, Happel said. Right-to-work laws prohibit agreements between trade unions and employers making membership or payment of union dues or fees a condition of employment, either before or after hiring.

"In the downturn, (Arizona employers) can lay more people off ... and then therefore have more flexibility when the economy turns around and swings back up," he said.

However, Shierholz said fostering unionization would help protect more workers and ensure that they are being rewarded for their productivity.

'BEGGARS CAN'T BE CHOOSERS'

In the meantime, a new survey from SnagAJob.com shows nearly two-thirds of employed Americans say they are happy at work, and an even greater number of workers in the West report job satisfaction.

"I do think that with the tough economy, perhaps the index rose slightly this year because people do understand it's a tough environment out there and for some of us who are lucky enough to have a job, that alone is reason enough to be happy," said Cathy McCarthy, SnagAJob.com's senior vice president of marketing. "It's a time when beggars can't be choosers, and you are more satisfied with just the fact that you're fully employed and doing better than unfortunately a lot of folks out there these days."

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