#FightingForFamilies with League’s new census fact sheets

Every year in December, the American Community Survey of the U.S. Census Bureau publishes a wealth of economic, housing, race and educational attainment information. This information is useful for policymakers, public administrators, advocates and direct service providers as they work to meet the needs of their communities. But the data is also helpful for all residents to better understand the issues facing their area and our state as a whole

The Michigan League for Public Policy has made it a tradition to publish fact sheets with some of this census information on the state, county, municipal, legislative and congressional district, and American Indian reservation levels. The new fact sheets are now up on our website in printable form for you to use for communicating with lawmakers, writing stories for the media, and planning or assessing service projects and programs. We would love to hear how you use the fact sheets!

Here at the League, the annual census data helps us analyze and inform our policy work, to see what’s working, what isn’t, and what still needs to be addressed. In particular, this data continues to underscore the fact that Michigan’s comeback story is not reaching everyone in the state and too many people are still struggling. Statewide, the poverty rate was 16.3% for 2017. The child poverty rate was 22.8%—nearly 1 in 4 Michigan kids were living in poverty last year. These residents aren’t feeling any “recovery.”

MI_TeleTownFinal 400 x 266As our economy evolves, a college degree or training is becoming more essential to getting a good job and a reasonable wage. But more than 50% of Michigan residents 25 and older do not have a college degree. The gender wage gap also remains a significant problem. Last year, the median wage for women was $38,518 compared to $50,760 for men. That means women are making around 76 cents on the dollar compared to men, which is below the national average (80 cents). And you can see the adverse impact that is having right on the same fact sheet, which shows 44.3% of female single-parent families were in poverty last year.

These are some of the issues we’re working to draw attention to this week as part of the Fighting for Families Week of Action sponsored by our friends at the State Innovation Exchange (SiX), a strategy center and support network for state legislators from around the country who seek to strengthen our democracy, advocate for working families, defend civil rights and liberties, and protect the environment. Among the activities this week will be a telephone town hall discussion TONIGHT in which you can ask state legislators and advocates (including yours truly) about such topics as good jobs, earned sick and family leave, overtime rules, predictable scheduling and wage theft.

The census data information and the League’s fact sheets will be useful for our discussion tonight, and I hope you can join us. But also keep these fact sheets in mind to inform your own work and advocacy on behalf of better policies to serve all Michigan residents.

— Peter Ruark

130,000 Michigan workers have had wages stolen by employers

People across the political spectrum may differ in their ideas about how high the minimum wage should be and how often it should be increased, but there is a general consensus that if a minimum wage is put into law, it should be honored. Many people may be surprised, however, at the frequency with which such laws are flouted and workers are paid less than minimum wage.

A recent report from the Economic Policy Institute (EPI) finds that in Michigan and other states, minimum wage theft often occurs. From 2013 to 2015, approximately 130,000 Michigan workers experienced a minimum wage violation, with an average underpayment of $2.05 per hour (or $3,300 if for a full year). According to the report, minimum wage theft can take one or more of the following forms:

  • Overt minimum wage violations: Paying workers less than the legal minimum wage;
  • Overtime violations: Failing to pay nonexempt employees time-and-a-half for hours worked in excess of 40 hours per week;
  • Off-the-clock violations: Asking employees to work off-the-clock before or after their shifts;
  • Meal break violations: Denying workers their legal meal breaks;
  • Pay stub and illegal deductions: Taking illegal deductions from workers’ wages or not distributing employee pay stubs;
  • Tipped minimum wage violations: Confiscating tips from workers or failing to pay tipped workers the difference between their tips and the legal minimum wage (the tipped wage is also too low in general); or
  • Employee misclassification violations: Misclassifying employees as independent contractors to pay a wage lower than the legal minimum.

workers wages stolen by employersMore than 61% of Michigan’s workers experiencing minimum wage theft are women. Black and Hispanic workers are more likely to be victims than White workers or workers of other races, and Hispanic workers experience the most severe wage theft ($2.47 average hourly underpayment, compared with $2.11 for White workers and $1.72 for Black workers). Workers in the “food or drink service” industry are the most likely to be exploited, with 21.3% of such workers having experienced at least one minimum wage violation and workers in that industry making up 38.2% of the total number of Michigan workers experiencing violations. Nine out of 10 workers experiencing minimum wage theft are U.S.-born citizens.

The report estimates that nationally, unscrupulous employers are stealing around $15 billion annually from employees in minimum wage violations—an amount that exceeds the value of property crimes (robberies, burglaries, larceny and motor vehicle theft) committed in the United States each year, which in 2015 was $12.7 billion. One can surmise that in Michigan most cases of wage theft are not reported; the Michigan Department of Licensing and Regulatory Affairs says that each year it receives over 5,000 claims and collects more than $2.0 million in wages and fringe benefits owed to Michigan workers—clearly far below EPI’s estimate of the frequency and magnitude of wage theft occurrence.

Wage theft is costly to society. Federal and state income taxes, along with payroll taxes that support Social Security and Medicare, are not fully deducted at the levels they should be. Moreover, when lower-paid workers are not paid the entire earnings that they are due, they likely spend less at local businesses and pay less in state sales taxes than they otherwise would. The hardship caused to workers should itself be a reason for alarm and outrage at wage theft, but the costs that are passed on to businesses, entitlement programs and state budgets provide an additional reason to take this crime seriously.

The League’s Making Ends Meet report shows that it’s nearly impossible to get by on minimum wage in Michigan, and we support raising the minimum wage and instituting other policies to protect wages and support workers. If you believe that you have been the victim of a wage theft violation, you can file a complaint with the State of Michigan. More information on how to do that is available here.

— Peter Ruark