Contrary to what you may assume about me, I actually enjoy the occasional trip to the mall. It’s a kind of a sociological expedition of the sort I find instructive and entertaining—I love watching the gangly teens, for example, as I recall going to the mall myself when I was 16, combing my hair and hoping to run into the girl of the moment. I find the big-box stores similarly interesting. The biggest downside these days is the parking, an already Hobbesian horror that has been exacerbated in the smart phone era by this new thing whereby now when you see a person get in his or her car, you can’t assume they’re leaving immediately because they’re probably going to sit there and check their phone for at least two minutes, and thus your search continues.
So I don’t want to be a killjoy here. I’m good with commerce, I’m fine with Christmas, and I will even defend Christmas music up to a point, a topic to which I may devote a column sometime between now and the fateful day.
But just take a few minutes with me to ponder the side of all this that most people don’t bother to think about. On Thanksgiving morning, I awoke to a batch of emails like the Nordstrom “Black Friday Is Here Early” one; when I brought in my Washington Post, I flipped through the circulars and really was gobsmacked the number of stores from Macy’s to Sears to H.H. Gregg and loads of others opening Thanksgiving night at 5 or 6 or 7 pm. Yes, I was aware that this is a thing, but I guess I’d thought it was an unpopular thing and had peaked a couple of years ago. Evidently not.
Who’s working at Sears or wherever on Thanksgiving evening? Maybe she doesn’t mind. Maybe it’s the most ironclad excuse going to escape the family. But...is she getting overtime? Does she make decent money to begin with?
On the overtime question, chances are she is not, and this is a huge and hugely overlooked issue that has had a dramatic effect on stagnating middle-class incomes over the last three decades and has surely contributed, in turn, to our growing inequality. Nick Hanauer, the Seattle venture capitalist and admirable class traitor (and friend of mine, I guess I should say), laid it out last week in a terrific column he wrote for Politico.
“In 1975,” Hanauer wrote, “more than 65 percent of salaried American workers earned time-and-a-half pay for every hour worked over 40 hours a week. Not because capitalists back then were more generous, but because it was the law. It still is the law, except that the value of the threshold for overtime pay—the salary level at which employers are required to pay overtime—has been allowed to erode to less than the poverty line for a family of four today. Only workers earning an annual income of under $23,660 qualify for mandatory overtime.” He then cited a study from the Economic Policy Institute calculating that just 11 percent of American workers, well down from that old 65 percent, qualify for overtime pay today.
In an issue paper it released in June, the Center for American Progress suggested that the overtime threshold be increased from the current poverty-level maximum to $960 a week, which would match the 1975 levels after adjusting for inflation. This would restore overtime rights to workers earning up to around $50,000 a year, which is roughly the current median. Remember—American workers work longer hours and are more productive today than they were in 1975. But they are paid less, and the vanishing overtime pay is a big part of why. The CAP paper estimates that if current trends continue unabated, overtime pay will disappear entirely by 2026.
If it were raised, who would be covered? Well, a hell of a lot of people. There’s this web site glassdoor.com that lists typical salaries. Wow, are these salaries terrible in some cases! A Best Buy sales associate makes, according to glassdoor’s information, $10.36 an hour, which (assuming a 35-hour week and 50 paid weeks a year) comes out to $18,130. So that person would qualify for some overtime now. But that’s a poverty wage. Try to keep that in mind the next time you start fuming when you can’t get the young man’s attention.
Over at Sears, a sales associate makes just $8.44 an hour, $14,770. Managers of course do better—an assistant manager pulls down $46,629, so she or he would still qualify for overtime if it were brought up to 1975 levels. A sales manager at Macy’s gets $47,324. Even at the higher-end Nordstrom, a department manager hauls in a mere $41,828. All of these people, and millions more like them, deserve a little overtime.
I know the counter-arguments. Yes, it would cost businesses more. Tough. Businesses have been cheating American workers for three decades. Would businesses merely lay off workers? Some would, some would not. Every capitalist isn’t Ebenezer Scrooge. Communities and society as a whole would reap huge benefits if we had a larger and more prosperous middle class that had more money to spend, as capitalists like Hanauer know well and preach regularly.
So just remember this season that if you’re purchasing anything that costs north of $300 or so, the person who’s selling it you probably can’t afford to buy it herself. And that this state of affairs is not just the way things are. It’s the result of decisions and policies that have had a hideous impact. They can be reversed, too, someday.