Wisconsin’s service workers are in crisis
Justin Otto makes $11 per hour working backstage at a Milwaukee concert venue. Or, he did, until recently.
“The theater I work at has indefinitely canceled every show,” he said. “I have no work right now.”
So how is he going to make it financially until the industry ramps up again?
His answer is the same as thousands of other service and hospitality workers in the state: “I don’t know.”
One in five Wisconsin workers holds “a poverty wage job with few benefits,” according to a 2018 report from the Center on Wisconsin Strategy at the University of Wisconsin-Madison.
That’s about 675,000 residents who make $11.95 per hour or less. Many of them hold part-time positions, stringing together multiple jobs to cover their bills. Most don’t have paid sick leave.
When hit with financial emergencies, their strategy is to earn more money by working more hours. But that’s impossible for many of them to do now — bars have shut down, restaurants are limited to carry-out, hotels are virtually empty and retailers have reduced their hours or closed altogether.
For these workers, the coronavirus outbreak has made a tough situation exponentially worse.
“Social distancing would be a lot less inequality promoting if we had the infrastructure of strong medical care, insurance and housing supports for low-wage workers, but we don’t,” said Laura Dresser, a labor economist and the associate director of the Center on Wisconsin Strategy. “That means that this crisis tends to push the inequality along, instead of the crisis showing how connected we are and pulling us closer together.”
It may sound counterintuitive, but low-wage workers in the critical health care industry are feeling the pinch as well, she said.
Home health care workers are losing hours because people working remotely are more available to take care of elderly or chronically ill relatives. Hourly nursing home workers and others without paid sick leave have to choose between losing money and potentially putting vulnerable people at risk.
“You’ve got people living right on the edge,” said Joel Rogers, director of the center. “Most people do not have more than $500 in savings right now. Poor people have even less than that.”
That’s the situation Savannah Bierma and her live-in boyfriend find themselves in.
Both of them work in the entertainment industry for hourly pay.
“My household at the moment is making zero income and we don’t know where that will be coming from,” said Bierma, 29, of Milwaukee. “We definitely live paycheck to paycheck. We have a savings account, but there’s not a whole lot in there.”
Her boyfriend has an immune disorder, she said, making him high-risk for complications if he contracts COVID-19. Even with health insurance through the Affordable Care Act, a prolonged hospitalization could break them financially.
“Our top priority right now is just to make rent so we have a place to be,” she said.
They have filed for unemployment, but worry about how long it will take to come through.
“Hopefully that will come through,” Bierma said. “They’re probably getting bombarded right now.”
About 29,500 people in the state filed new claims for unemployment between March 15 and Wednesday, according to preliminary data from the Department of Workforce Development. That fourday total is more than five times the 5,200 Wisconsinites who filed for the first time during the week ending March 14.
Not all hourly workers qualify, according to Dresser. People can only get unemployment if they have worked steadily for the same employer for nine months.
“If you are managing two jobs with volatile hours, it’s hard to get past the threshold,” she said. “It’s so closely tied to steady work, poor workers who have been in low wage jobs a long time are less likely to get it.”
The maximum weekly benefit is $370, according to Ben Jedd, Department of Workforce Development spokesman. Because unemployment payments are based on pay, low-wage workers get significantly less.
“We shouldn’t be too hopeful; we shouldn’t assume that solves the problem,” Dresser said. “Unemployment insurance is an answer but not a total answer.”
Social supports such as food assistance and BadgerCare are also part of the solution, she said. The next step should be local, state and federal policies that keep people off the streets, such as providing rent assistance, halting evictions and ensuring that power and water are not shut off due to late or non-payment.
Peter Rickman, president of the Milwaukee Area Service and Hospitality Workers Organization, is hopeful this pandemic will lead to long-term solutions that make life better for low-wage workers even after the immediate crisis has passed.
“We cannot allow, in this moment, a reliance on the structures that have failed us in the past,” he said. “Folks will have to be bold and experimental. This country didn’t get out of the Great Depression by relying on everything they had done before. This is that sort of moment.”
His group has come up with some potential strategies he says would help society over the long term.
One proposal is a service worker relief fund, which would be financed by municipal, state and local governments. The fund, which would be jointly administered by the union and service sector employers, could cover lost income, health care costs and paid sick leave.
Another idea for collective action that could help the industry is a workforce pool to standardize pay and benefits for service workers. The pool could dispatch available workers to businesses that need them. For example, a restaurant that needed a cook 10 hours a week could be matched up with someone already working 30 hours somewhere else.
Economic inequality has impacted people of color and women for generations, Rickman said, but it hasn’t received the attention it deserves from those in power.
“It’s not something white, middleclass decision-makers would have been willing to address until now,” he said. “The immediate response to mitigate this harm could give way to solutions to the problems that have confronted lowwage and working-class people for years and years and years.”
In the meantime, Rickman hopes the federal government implements a proposal under consideration to send every American adult a check for at least $1,000. Low-wage workers would spend, rather than save that money, improving both their individual lives and the economy, he said.
That won’t go very far: In Milwaukee, the median monthly rent for a one-bedroom apartment stood at $729 as of November. For a two-bedroom, it was $903.
Still, Joseph Ontiveros, 20, of Milwaukee could definitely use such a check from the government. He works at Little Caesar’s pizza for $8 per hour. He used to work about 35 hours per week, which left him with a little bit left over after he paid his share of the rent and bills at the apartment he shares with three friends.
Now he’s down to between 20 and 25 hours a week.
As his hours are cut further and the odds of landing a second job decrease he worries he will have to resort to a solution some of his friends have already been forced to use due to the outbreak: taking their television sets, video game systems and other electronics to the pawnshop.
“Just so they can pay their rent and their bills, the light bill, the phone bill. They have to take their most valuable stuff in,” he said. “I may have to be pawning my own stuff to make ends meet.”