We like to think of Maine as a state of independent farmers, foresters and fishermen who make their livings off the state’s abundant natural resources.
But the truth is that a person working in Maine is much more likely to be operating a cash register than a skidder.
Three of the top five employers in the state are retailers, with the sector employing 87,092 people, far more than manufacturing, construction, agriculture, farming and fishing. Combined with the 56,805 who the U.S. Census estimates work in the sector that includes restaurant and hospitality businesses, nearly a quarter of Maine’s workers are in these service jobs.
That’s important context for understanding the recent Department of Labor jobs report, which puts Maine’s unemployment rate at 4 percent, below the national unemployment rate and within the range economists consider to be full employment. But when you include forced part-time workers – people who would like to work full time but can’t find a full-time or year-round job – the unemployment rate is a much less impressive 9.3 percent.
SERVICE SECTOR
The prevalence of service jobs in our economy and the increasing number of forced part-time workers is no coincidence. Retail and food service jobs are much more likely to be part time or seasonal than jobs in other industries, and they leave their workers in a much more vulnerable position when the economy takes a turn for the worse.
Only the people who calculate unemployment rates treat part-time work and full-time work as if they were the same. Part-time workers are five times more likely to make minimum wage than full timers. They typically don’t earn paid sick time or vacation days. About half don’t reach the 30-hours-a-week threshold that qualifies them for employer-provided health insurance under the Affordable Care Act.
And while the growth in forced part-time work coincided with the 2007 financial collapse and slow recovery, there is no indication that the situation won’t get worse even as the general economy improves.
MAXIMUM EFFICIENCY
A 2012 New York Times report found that big retailers are using sophisticated software to predict their labor needs, allowing them to limit the hours they offer for maximum efficiency. The move to more part-time work may have started as a response to the recession, but it is probably going to be a continuing trend.
Economists predict most of the fastest-growing jobs over the next decade are not, as we are often told, in high-tech fields, but in providing services, such as retail sales, food service, home care and child care. These are all jobs that easily result in forced part-time employment.
POLICY IMPLICATIONS
That has serious policy implications for Maine. The responses should include:
• Accepting federal funds to expand Medicaid for low-income wage earners.
• Raising the minimum wage.
• Subsidizing affordable housing.
The Affordable Care Act was constructed to protect part-time workers who would not be eligible for employer-sponsored insurance policies, but the Supreme Court made Medicaid expansion optional for states. It’s long past time for Maine to take the option.
An estimated 60,000 people would be covered, including many forced part-time employees. Companies can control who qualifies for benefits, so the public safety net should be stretched to catch the people who don’t make it over the hurdle.
The current $7.50 state minimum wage creates the classic trap for people trying to escape poverty. The jobs they are most likely to get are the jobs with low pay and undependable hours. Keeping the minimum so low puts pressure on them, and it puts pressure on social service programs.
HOUSING MATTERS
And too many low-income workers cannot find a decent place to live. According to a study by the National Low Income Housing Coalition, a Maine minimum-wage worker would have to clock 100 hours a week to be able to rent a two-bedroom apartment. Put another way, it would require full-time employment at $17 an hour to be able to make the rent in most areas of the state. The living wage is higher in places like Portland.
Stable, affordable housing is an essential foundation for healthy, productive families. With a job market producing a high rate of low-wage, less-than-full-time jobs, all levels of government have to work together to make sure that people with jobs can afford a place to live.
We are not advocating that Maine strive to have an economy based entirely on part-time work at low wages. But we should face reality and look beyond a rosy unemployment rate figure. Forced part-time work will be a feature of our economy for a long time, and one government programs should be prepared to address.
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