The American Economy will never recover if workers are robbed of their wages. When workers suffer from wage theft, the economy feels it too. According to Kim Bobo, founder and executive director of Interfaith Worker Justice, in her new book Wage Theft in America, between two and three million workers are paid less than the minimum wage. More than three million are misclassified by their employers as independent contractors; many are not paid overtime or paid at all. Offenders range from huge corporations like Wal-Mart to small sub-contractors in the residential construction sector.
Millions of dollars each year are stolen out of the US economy in this way. While tracking where that money goes is a bit more complicated, no one could argue that how working class people spend money is more beneficial to the economy. These are wages that otherwise would pay home loans, car insurance, and groceries. Since the vast majority of wage theft victims are low-income, it becomes impossible to escape the inequality.
Some of the most vulnerable are immigrant workers, and the day laborers among them. The National Day Labor Study released in 2006 reports that in a two month period 49% of day laborers had been denied payment from an employer for work they had completed.
Immigration reform needs to be a top priority for President Obama. If millions of workers remain in a underground economy vulnerable to wage theft, the United States will never see the new growth that this country needs. Bobo notes that the number of Department of Labor staff investigating Wage and Hour violations has decreased by more than 50% since the agency began in 1941, while the number of affected workers has increased by 900%. We need to empower the Department of Labor and OSHA to enforce the laws already on the books, as well as drafting new pro-worker legislation and supporting worker organizing and empowerment.
President Obama must prioritize bringing immigrant workers out of the underground economy for the sake of the country’s economic growth. If not, we’ll never rescue America and keep throwing good money down the drain.