What America would look like if it guaranteed everyone a job

Wednesday, September 6, 2017

A recent detailed plan from economists William Darity Jr., Darrick Hamilton, Mark Paul, and the Insight Center for Community Economic Development, is far more ambitious — it calls for employing about 14 million people at the cost of $775 billion per year, paid for in part by greater tax revenue, reduced reliance on safety net programs like food stamps, and lower incarceration rates. Wages would start at $11.56 an hour or $24,036 a year, indexed to inflation, plus another $10,000 a year in health care and retirement benefits. Participants would also get paid family, sick, and vacation leave. And the jobs would be guaranteed, not limited to a set number.

Still another outline from economist Pavlina Tcherneva, a professor at Bard College and its Levy Economics Institute, would also provide a guarantee, and allocate enrollees across nonprofit organizations rather than having the federal government provide jobs directly. While Tcherneva doesn’t go into this, such a plan would almost certainly amount to a massive subsidy to religious organizations, given how dominated the US nonprofit sector is by local religious groups and charities.

The second big question is what kind of work these workers would do. The Darity/Hamilton/Paul plan to employ 14 million people, for example, seems to envision pairing the guarantee with expansions to public services enabled by a larger government workforce.

Jobs, the authors write, could include child care work or teachers’ aides positions, and work for a new postal banking division of the Postal Service, established to provide an alternative to predatory payday lenders and check cashing services for poor households not reached by traditional banks. The plan offers little description beyond that.

Those are all pretty much permanent jobs. If a job guarantee were enacted in a recession, and many of the enrollees became child care providers, what happens when the economy improves and workers find jobs in the private sector? It wouldn’t be tenable to eliminate a universal child care program because the economy improved. Nor, if the program employed bus drivers, would it make much sense to cut bus routes. Either the government provides child care and runs buses, or it doesn’t; making how much child care it provides or how many buses are available dependent on the state of the economy would be odd at best and counterproductive at worst.

Infrastructure work, also included in the plan, could be a more appropriate area for job guarantee labor. While ideally we’d repair roads and bridges and rail lines as soon as they need it, in practice that rarely happens, and tying projects like those to economic trends might not be so bad. But implementing a real job guarantee plan would require thinking through how useful a large number of untrained workers would be for such projects and estimating how many could be productively put to use. Then, if that number is less than the stock of unemployed people during recessions, the government would still have to find other roles for people to fill.

A plan would also have to distinguish between different groups of people benefiting. For the long-term unemployed and young workers new to the labor force, more permanent positions might make sense, as their difficulty getting work isn't necessarily tied to a bad economy. But for people struggling in a recession, the program might be more useful if it encourages work-sharing and deters layoffs, rather than pushing previously employed people into new jobs that they might not be a good fit for.

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