In these very anxious times, it can be helpful to remember that the work we are all doing matters. Epidemiology is rightly at the front of everyone’s mind right now. But we should also be worried about the major effects that the Covid-19 pandemic will have beyond those directly infected.
As a labor economist, I’m greatly worried about the economic damage that quarantines, social distancing efforts, and the like will cause. Many, many people will not be able to work, and will lose the earnings that they depend on. The damage will be concentrated among low-wage workers with the fewest reserves to draw upon. We are already hearing fears — which I share — that the coronavirus recession will be worse than the Great Recession a decade ago. It will be essential that we respond quickly and effectively to limit the damage.
Toward that end, I’m especially proud that the Institute for Research on Labor and Employment, which I direct, has been able to have a quick impact on the national conversation and the policy response.
First, The Shift Project, headed by Assistant Professor of Sociology Daniel Schneider, has done excellent work in recent years measuring the prevalence of unstable, unpredictable work among large low-wage employers like Walmart and McDonalds. Their work is cited in today’s important New York Times editorial, which points to the large number of such workers who lack access to paid sick leave, and argues that employers have a duty to give their workers paid leave, not just during the crisis, but permanently.
Second, I wrote an op ed (with Jared Bernstein) last week arguing for creating a temporary paid leave program, to be reimbursed by the federal government, to support workers idled by the pandemic. The bill that the House of Representatives passed last night, which the Senate is expected to pass when it returns on Monday (here is a summary), includes a set of provisions that closely resemble our proposal:
- Two weeks of paid leave for people who are sick, quarantined due to symptoms, caring for a sick relative, or caring for kids whose schools are closed, paid at two-thirds of 100 percent of regular pay, depending on the reason.
- After that runs out, three months of paid family or medical leave.
- Reimbursement to employers for both of the above through credits against payroll taxes, refundable if the credit exceeds the firm’s liability.
- General fund transfers to hold the Social Security trust fund harmless.
This is a major step forward, and will help millions of workers and small businesses make it through the crisis.
The bill is not perfect: It excludes employers with more than 500 workers, allows the Labor Department to exempt employers with less than 50, and is temporary. (Apparently the last was a major sticking point in negotiations — Speaker Pelosi wanted to make the leave requirements permanent, but Treasury Secretary Mnuchin insisted on a temporary provision.) Larger employers should face enormous public pressure — aided by the Times editorial — to match what smaller employers are providing, and we should insist that the Department of Labor not be too free with exemptions.
This is only the first bill, and there will certainly be more. Three things I’m hoping for in the next round are provisions to close the loopholes for small and very large employers; the inclusion of workers who are not themselves sick but idled due to “social distance” requirements or to resulting impacts on their employers’ businesses; and measures that will make it easier to convert this temporary policy into something that will be available for sick workers after this pandemic is past.
Economic impacts are going to be a major component of the impact of this crisis. We social scientists will all have roles to play, and the work that researchers at the Institute for Research on Labor and Employment and elsewhere at Berkeley do will be more important than ever.
Keep up your spirits, and contribute to solutions where you can, whether it’s in your own research, or by simply donating to your local food bank.