Though the jobs report released Thursday shows promising growth, economists and policy-makers are warning that the report only reflects the numbers captured in mid-June before the recent virus spike, and that layoffs will accelerate as states begin to close again. They also warn of a second threat: the imminent expiration of the CARES Act, the $2 trillion economic relief package passed to aid Americans during the pandemic. Among its protections, the Act provided eligible Americans with a $1,200 stimulus check and secured laid-off workers an extra $600 a week to keep them afloat (pre-pandemic, the average unemployment check was only $385 per week, which is not enough to keep a family above the poverty line).
Ultimately, when Congress returns on July 20, it will face mounting pressure to take swift action in the face of perilously high stakes. Emily Benfer, a housing expert and associate professor at Columbia Law School, told the New York Times that without a second government intervention, we could face “an avalanche of evictions across the country,” among other threats.
It remains unclear what a proposed package would include. The Post reported that President Trump has considered sending Americans another round of stimulus checks, but he remains uncommitted. This week, Senate Minority Leader Chuck Schumer and Sen. Ron Wyden (D-Ore.) introduced legislation that would link unemployment benefits to state joblessness levels, allowing the additional $600 that jobless workers have been receiving to phase out in stages as each state’s unemployment rate drops below 11 percent. The bill reflects the most prominent effort yet to expand federal policies that kick in automatically during a recession.
Regardless of Congress’ exact action, economists say the economic trends reflect a central fact of the crisis: the economy can’t truly recover until the pandemic is under control.
As if abandoning workplace safety procedures during a pandemic wasn’t enough, the Labor Department is now walking away from wage theft. This week, the Department turned back an Obama-era enforcement tool designed to enforce national wage and hour laws by holding employers liable for intentionally cutting workers short. Federal enforcement is critical to protect workers without alternative recourse — studies have shown that workers, and particularly those who receive the lowest pay, are annually cheated out of the billions of dollars to which they are entitled under federal law. A 2017 study from the Economic Policy Institute (EPI) found that just one form of wage theft — employers paying less than the minimum wage — has cheated 2.4 million employees across the ten largest U.S. states from $8 billion annually.
The relevant law — the Fair Labor Standards Act (FLSA) — generally requires employers to pay a minimum wage of $7.25 and to provide overtime compensation for employees who work more than 40 hours a week. Since 2011, the Department has held employers liable for double back pay if they violated the law, which was necessary to induce employers to comply with the law instead of cutting corners. Under Trump’s latest deregulation effort, the DOL will only hold employers liable for normal back pay. Critics say that the move “surgically removes” an employer’s incentive to comply with the FLSA because, now, employers who pay employee’s improperly will simply incur an interest-free loan on the backs of their employees, provided the employers are even caught or held accountable in the first place.
Though sports leagues like the MBA, Major League Soccer, and the WNBA have geared up for a safe return, they realistically remain at the mercy of steep national infection rates. This is particularly the case as cases surge around the country, and especially in Florida, where the NBA, Major League Soccer, and the WNBA planned to host games, and in Texas, where the MLB has planned 60 baseball games in the coming months.
Key questions remain unanswered: what will happen if enough players pull out of their respective sports seasons? What safety risk will each League tolerate before shutting down? (For instance, in March, a single positive test caused the NBA to shut down.) The questions are already highly relevant: the NBA announced last weekend that 16 of its players tested positive and several stars have announced that they will not play when the league restarts in July. In the MLB, a stream of players has already decided not to play. Similarly, the MLS, which could resume its season in the coming week, has already reported 24 positive tests among players. Other athletes have expressed concerns about their own health and that of their families. Meanwhile, the NFL, which is slated to resume play later in the year as opposed to the upcoming seasons of its peer leagues, has continued to negotiate safety issues with its players’ union. Though yet unconfirmed, negotiations have thus far included opt-out provisions and a shutdown threshold.
Meanwhile, employees’ concerns over diversity have gained traction in recent weeks amidst a national reckoning over racism, and Silicon Valley has faced particular heat over its lack of diversity. A Black Facebook manager and two job applicants who were rejected by the company are alleging that Facebook engages in wide-spread racial discrimination. In a complaint filed Thursday with the Equal Employment Opportunity Commission (EEOC), the complainants reported that Facebook discriminates against black employees in its “hiring, evaluations, promotions, and pay” and fails to give Black workers equal opportunities in their careers. The complaint was filed by Oscar Veneszee Jr., a Navy veteran who recruits employees of color as part of Facebook’s diversity initiative, along with two of Veneszee’s recruits, who stated that Facebook denied them positions despite their over qualifications.
The complainants are challenging standard Silicon Valley recruiting practices, which rely heavily on “culture fit” and often result in biased outcomes against those who don’t fit into the predominantly white and Asian sector. Indeed, according to its 2019 diversity report, 87% of Facebook’s workers are either White or Asian, while black workers make up less than 4% of the social network’s roughly 45,000-member workforce. Currently, more than 500 advertisers are boycotting Facebook for its failure to regulate hate speech on the platform. And the complaints are nothing new: two years ago, a Black executive published a memo accusing the company of “failing its Black employees and its Black users” when he resigned. Last year, anonymous current and former employees published their own memo exposing racist experiences at the company.