Source: Ken Stoler, Nicole Berman, Ken Gritzan, PricewaterhouseCoopers (PwC), January 2015
From the summary:
PwC is pleased to share with you our second annual Executive Compensation: Clawbacks — Proxy Disclosure Study. This study presents our analysis of the compensation recoupment or “clawback” policies of 100 large public companies as disclosed between 2009 and 2013 in their year-end proxies. We hope this study will be helpful to those of you preparing proxies as well as those responsible for compensation strategy and financial reporting. Clawback policies, although not new, are top of mind for the C-suite and Boards and in compensation committee and annual shareholder meetings. And clawbacks continue to be discussed in the news and in the courts. CEO’s and CFO’s have been “on the hook” to return awards after a financial restatement, if earned as a result of misconduct, since passage of the Sarbanes-Oxley Act of 2002. More recently, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 directed the SEC to craft new rules for additional clawbacks. As a result, we continue to see companies modifying their clawback policies in anticipation of the new SEC rules, which have yet to be issued. In fact, 40% of the companies reviewed made some type of change to their plan during 2013.
Source: Jennifer Burnett, Council of State Governments, The Current State, Issue: 3, February 9, 2015
Co-ops are gaining in popularity as a new form of business creating economic activity in the states. Based on their unique structure, some studies suggest that cooperatives may have a greater economic impact than their more traditional counterparts, including paying higher wages.
Source: Paraprofessional Healthcare Institute (PHI), 2015
PHI has documented the wages in each state for the three main occupations that make up the direct-care workforce.
Personal Care Aide Wages
For Personal Care Aides –who constitute the fastest-growing occupation in the nation—wages are low and trending lower across the nation.
Home Health Aide Wages
Over the next ten years, Home Health Aides will add over 400,000 jobs to the economy — a growth rate of nearly 50%.
Nursing Assistant Wages
Despite shifting preferences among service recipients and policymakers toward home and community settings, demand for institutional care continues to grow at a substantial rate.
Source: Lawrence Mishel and Will Kimball, Economic Policy Institute (EPI), February 3, 2015
A pattern that Colin Gordon has presented in past years (2013, 2012) is that union membership density fell as the share of income going to the top 10 percent escalated. We update his chart using new data from Piketty and Saez’s analysis of tax data. Union membership remained at 11.2 percent in 2013, though we already know that it dropped to 11.1 percent in 2014 (not shown in the figure). The share of income going to the top 10 percent hit 47.8 percent in 2012, the highest it has been since 1917 (the earliest year available in Piketty and Saez’s data). ….
Source: Jennifer Burnett, Council of State Governments, Capitol Facts and Figures, November 2014
From the summary:
The Council of State Governments has been collecting data on governors’ salaries for The Book of the States since 1937. The average governor’s salary has grown more slowly in recent years than in the past, with a number of states cutting their chief executive’s pay during and after the Great Recession….
Source: Justin Wolfers and Jan Zilinsky, Peter G. Peterson Institute for International Economics, RealTime Economic Issues Watch, January 13th, 2015
Under what circumstances can raising the pay of low-skilled workers at large corporations lead to general improvements in productivity? Last month, Aetna informed the Institute of its plan to raise wages of its lower-paid workers. With this natural experiment in mind, Justin Wolfers and Jan Zilinsky decided to explore literature and theory on how pay increases influence productivity. The following note summarizes their findings for major private-sector companies in the United States in general (and does not address the implications for Aetna itself or for any specific company or sector).
Economists have long argued that increases in worker pay can lead to improvements in productivity—indeed, that it can actually be profitable to pay workers higher wages. As Alfred Marshall, the father of modern economics, argued almost 125 years ago, “any change in the distribution of wealth which gives more to the wage receivers and less to the capitalists is likely, other things being equal, to hasten the increase of material production.” Since then, economists have compiled rich data validating Marshall’s hypothesis that paying higher wages generates savings:
Higher wages motivate employees to work harder. ….
Higher wages attract more capable and productive workers ….
Higher wages lead to lower turnover, reducing the costs of hiring and training new workers. ….
Higher wages enhance quality and customer service. ….
Higher wages reduce disciplinary problems and absenteeism. ….
Firms with higher wages need to devote fewer resources to monitoring. ….
Workers excessively concerned about income security perform less well at work. ….
Other mechanisms by which higher wages can yield offsetting benefits include:
– Higher wages are associated with better health—less illness and more stamina, which enhance worker productivity.
– Greater job satisfaction can result in less conflict between employers and labor groups.
– Enhanced reputation with consumers (compare the reputations of Costco and Walmart). …..
Effect of Large Corporations Raising Wages of Low-Paid Workers
Source: Tomas Hellebrandt, Peter G. Peterson Institute for International Economics, RealTime Economic Issues Watch, January 13th, 2015
Source: Peggy Haack, with Erin Gernetzke and Caroline Oldershaw, Wisconsin Early Childhood Association, 2014
From the summary:
Starting Early, Starting Now: Investing in Teachers to Grow Child Care Quality explores an unresolved problem facing Wisconsin and our nation: How do we set young children on a positive life trajectory through quality early education while paying near poverty-level wages to those professionals who care for and teach them?
Source: Oren M. Levin-Waldman, January 22, 2015
…If wages are supposed to rise with productivity, then why haven’t they? By all accounts the economy is improving. In December 2014, total nonfarm payroll employment rose by 252,000, and the unemployment rate dropped to 5.6 percent, which is the lowest it has been since the end of the Great Recession in 2009. At the same time, since the end of the Great Recession, productivity has been increasing, but those productivity gains have not been shared with the workers….
Source: Workforce Information Council, September 2014
In late 2012, the federal-state Workforce Information Council established an Administrative Wage Record Enhancement Study Group to examine the feasibility of adding variables to the quarterly wage record reports that employers submit to all states as part of the Unemployment Insurance (UI) Program. They began looking at the administrative records as an alternative source for improving local and state labor market information amid concerns over the adequacy of existing survey-based statistical data for state and local education and training program planning and accountability, economic analysis, career planning, and workforce program administration. In its first year of investigation, the Study Group has surveyed state agencies responsible for UI wage record collections, user organizations that might benefit from wage record enhancement, and payroll services/software companies that compile and report the wage records for many employers. Those activities have resulted in some key findings and recommendations for future steps.
Source: U.S. Bureau of Labor Statistics, January 23, 2015
In 2014, the union membership rate–the percent of wage and salary workers who were members of unions–was 11.1 percent, down 0.2 percentage point from 2013, the U.S. Bureau of Labor Statistics reported today. The number of wage and salary workers belonging to unions, at 14.6 million, was little different from 2013. In 1983, the first year for which comparable union data are available, the union membership rate was 20.1 percent, and there were 17.7 million union workers. … Public-sector workers had a union membership rate (35.7 percent), more than five times higher than that of private-sector workers (6.6 percent). …. Black workers were more likely to be union members than were white, Asian, or Hispanic workers…. Median weekly earnings of nonunion workers ($763) were 79 percent of earnings for workers who were union members ($970).