Monday, October 12, 2009

Mixed Messages, Unintended Consequences
As the Great Recession of 2007-20?? moves into hopefully its final stage of slow recovery and lingering pain, it’s becoming clear that the labor market, specifically the difficulties of workers and jobseekers in its lower rungs, will take center stage. The problem is that the collision of an irresistible force, the “work-first” orientation of public policy over the last 20 years that kicked into overdrive with the federal welfare reform of 1996, has slammed into the immovable object of a labor market in which employers simply aren’t hiring. The result is a muddled mess of contradictory policies that might not be making things worse, but assuredly aren’t doing as much to help as circumstances call for.

Today’s newspaper details the difficulties of unemployed New Yorkers whose unemployment insurance is nearing its end. This recession has stood out for how long those who’ve lost jobs have remained out of work: with some exceptions, most of these are older workers in declining industries whose educations and skill sets are sufficiently limited that finding something that pays as well is unlikely in the extreme. The problem is that they aren’t finding anything:

Ruby Sievers, 47, a construction laborer who lives in Binghamton, said she had not been able to find work for two years. She collected the last of her extended benefits of $430 a week on Wednesday and feared that she might again have to resort to temporary assistance from the state to pay her rent and feed herself and her 11-year-old son, she said.

Ms. Sievers said she received welfare benefits this year during a lapse in unemployment benefits in New York. She has been impatiently awaiting word that Congress will pass the extension to limit the gap in her income.

“If it doesn’t, I’m not going to be in real good shape,” Ms. Sievers said. “I couldn’t even get $7 an hour if I wanted to. It’s just not there.”

This woman might be an exception, but for the most part if you work in construction over a period of years, you’re a pretty damn good worker: you might have to be at a job site by 6 AM, for weeks or months at a stretch, and as a laborer you have to take direction and prove yourself competent. (I won’t even get into the sexist garbage she probably had to contend with.) If that person can’t find even a menial job, it’s not there to be had. Which is the real tragedy of this economic moment.

On the other hand, that total absence of jobs might render a “disturbing” switch in California’s welfare policies more understandable. The country’s most populous state is suddenly not requiring its aid recipients to work:

Anna Zendejas, a welfare recipient […] was more than a little surprised to get a letter recently saying that she did not need to work to collect her check — in effect, a return to the much-derided welfare approach that existed before a national overhaul in the 1990s.

It was no fluke. This fall, tens of thousands of Californians will be given a similar choice as the state embraces a startling reversal in some of its welfare policies for the next two years. It is a route that few are happy with, but that reflects the intersection of a recession, the worst fiscal crisis in the state’s modern history, a governor determined to slash social services and the unplanned effects of federal stimulus money.

Though state officials emphasize that the change is temporary, some people inside and outside of state government worry that the abrupt reversal may encourage a return to habits that could be difficult to undo.
“We spent 10 years changing the culture, from just getting a check,” said Frank Mecca, executive director of the County Welfare Directors Association of California “We think this will send a confusing message and do lasting damage.”

I’m sympathetic on a human level—assuming he’s been at this awhile, this guy probably spent a lot of time and effort reorienting first his staff, then his clients toward the new order of welfare reform. Now he has to throw it in reverse, knowing that in two years’ time the work-first regime will return. But it does make sense: these are the lowest-skilled jobseekers, with the most significant barriers to steady work. They’re extremely unlikely to find jobs, and it’s extremely likely that any work they do find will be low-paying and, whether because their barriers (everything from trouble with childcare arrangements to a health problem or a fight with a co-worker or manager) get in the way or because conditions worsen again and they get laid off, of short duration. Forcing them onto the treadmill is really just process fetishism on the public dime.

And yet: the basic concept of work first, that an individual conforms to societal values as a condition of receiving public assistance, is valid in good times as well as bad. I’d rather see jurisdictions use this time of slack labor demand to help skill up their aid recipients—get them a GED, or a vocational credential, or even help speakers of other languages learn English better—so that when hiring does resume, their odds improve. But that isn’t free either, of course, and the politics of more support for the worst off in bad times are difficult, to put it mildly.

There’s another option, the one Bob Herbert keeps going on about: large-scale public job creation, of the kind FDR used in the ‘30s. But this isn’t easy either: back then, you could give a thousand guys shovels and they’d dig you a hole. Now you use a machine, requiring maybe three or four guys to operate and service, to do the same job, only faster and better. Massive public works employment isn’t really possible in a time of advanced technology, and unskilled work is disappearing altogether: as I’ve had occasion to note in various work publications, more than half the jobs created in the federal stimulus require education beyond high school despite the explicit intention of the legislation drafters to extend as much opportunity as they could to the lower-skilled.

This doesn't mean that large-scale job creation is impossible--just that we'd have to do it differently. And that inevitably means experimentation, some trial and error, and in this climate a big heaping of scorn and vitriol from those out of power. At this point, the politics still probably weigh against the administration and Democrats in Congress taking that step.

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