One third of US factory workers among nation’s ‘working poor’

Many US factory workers are supplementing their income with welfare highlighting the issue of the US minimum wage - image courtesy of Dollar Photo Club.

As the US heads towards the November election with presidential candidates promising a brighter future, new research has revealed that one in three US factory workers still rely on welfare assistance.

That’s the startling revelation according to research by the University of California, Berkley’s Center for Labor Research and Education.

The study found that present wages aren’t enough to support the lives of 1 in 3 of the nation’s 2 million supervised manufacturing employees, who rely on welfare assistance in addition to their regular income just to get by.

The study calculated that low wages in manufacturing cost taxpayers approximately $10.2bn a year in public assistance, with one third of manufacturing workers seeking government assistance in the form of food stamps, healthcare subsidies, tax credits for the poor and other forms of welfare to help offset their low wages.

Fulltime vs tempoary factory workers

The percentage is even higher for temporary workers, hired through agencies, of which about half are reliant on welfare.

The study found that families of 32% of all manufacturing production workers, and 46% of those employed through staffing agencies, who worked at least 35 hours a week and 45 weeks during the year, were enrolled in one or more public safety-net program.

The University of California, Berkeley researchers noted that the largest classification of temporary manufacturing production workers – assemblers and fabricators – earn a median wage of $10.88 an hour, compared to $15.03 for those hired directly by the manufacturers.

The research found that in 2013 the median wage for non-supervisory manufacturing jobs was $15.66, while a quarter of the workers made $11.91.

According to the website www.payscale.com, the average wage of a US assembly line/factory worker is $11.89 per hour, considerably less than the $25.53 average hourly wage of US workers which financial data research website YCharts calculated for the period ending April 30,2016.

Co-author of the University of California, Berkley’s report into the financial circumstances of many US manufacturing workers, Ken Jacobs, highlighted in his paper that the manufacturing industry had undergone a dramatic drop in the average wage on offer for its workers in recent years, which also coincided with a change in the way the industry was perceived and its changing culture.

“Manufacturing has long been thought of as providing high-paying, middle-class work, but the reality is the production jobs are increasingly coming to resemble fast-food or Walmart jobs, especially for those workers employed through temporary staffing agencies,” he said.

“While employment in manufacturing has started to grow again following the Great Recession, the new jobs created are less likely to be union and more likely to pay low wages,

“In decades past, production workers employed in manufacturing earned significantly higher than the US average, but by 2013 the typical manufacturing production worker made 7.7% below the median wage for all occupations.”

The report’s findings comes at a time when US workers are experiencing one of the lowest paces of wage growth on record, several years after the US government declared an end to the longest period of economic contraction since the Great Depression.

Low wages not limited hours

A key finding of the report was that the high use of public safety net programs by manufacturing workers was due to low wages and not limited working hours, as the families of 32% of all the industry’s workers and 46% employed through staffing agencies who worked at least 35 hours a week and 45 weeks in the year were enrolled in one or more public safety- net programs to receive assistance to supplement their normal wages.

The report’s findings comes during an election cycle which has seen the debate about minimum wage become a key election issue.

The notion of raising the US minimum to $15 per hour from its current figure of $7.25 has been a talking point and chief election platform issue for Democratic presidential hopeful Bernie Sanders, while Republican presidential favorite Donald Trump has also shown some support for lifting wages.