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How Long Can Grand Rapids Hang On?

August 31, 2010

It’s almost time for Labor Day—the supposed tribute to the American worker. But across the country, and especially here in Grand Rapids, there’s not a lot to celebrate. Consider these issues:

Crippling unemployment levels. The “official” unemployment rate in the country is currently 9.5 percent. But Michigan’s unemployment rate is 13.1 percent. Grand Rapid’s unemployment rate this summer was 11.1 percent, but don’t get excited yet. We may have slightly lower unemployment than the state average, but we also are getting paid less for the same work.

Lowest salaries of any urban area in Michigan. It’s no secret that Michigan is limping ruinously behind the rest of the country in employment. But here in Grand Rapids, we have the lowest wages in the most depressed state in the country. The cross-country average wage is $20.90 an hour; the statewide average is an hourly wage of $20.64; in Grand Rapids, it’s $19.57. It’s quite a distinction to be fleeced more than anyone else in the United States.

Dwindling insurance coverage. Along with those dismal wages, Michigan has the fastest-growing rate of uninsured workers in the country. Folks in Grand Rapids are almost completely dependent on employee-offered insurance—that’s how over 81 percent of the insured get their benefits. But 7.8 percent of Michigan residents have no insurance at all. Thirty percent of those workers are employed for companies with 500 workers or more; companies that could easily provide benefits. But with a huge pool of available, and desperate, labor, why should the capitalists pay a dime more than they have to?

There are a few exceptions to this bleak picture, but it’s not good news for most of us. In fact, Grand Rapids citizens have an additional monetary burden: footing the bill for fat salary and benefit packages for City of Grand Rapids workers. The current average gross salary for Grand Rapids city workers is $60,801, way more than the median household income in 41 U.S. states, including, of course, Michigan. Along with those wages are excellent benefit packages—completely paid for, even after retirement.

A lack of living wages for the rest of us. Remember our slightly lower unemployment rate here in Grand Rapids? Just because we have jobs doesn’t mean the jobs are worth having. Starting in 2001, the area’s biggest employers, such as the furniture manufacturers, began massive layoffs. Companies like Steelcase laid off more than half its workforce; Electrolux in Greenville closed completely. And the available jobs now? They are not what anyone can consider adequate replacements. One jobs site states that two of the most common jobs available in Grand Rapids are for registered nurses and physical therapists, both of which require special degrees and certification. Another frequent hiring category? That would be for cashiers.

Part of this scenario is being created, of course, by the NAFTA/CAFTA stranglehold that allows U.S. jobs to be removed to other countries where workers are exploited via minimal wages and no benefits, equaling low overhead costs for the companies.

Another capitalist trick that’s popular in the Grand Rapids area is the “contract re-hire” scam. In this situation, manufacturers lay off long-term employees; wait until they are desperate; and then hire them back at much lower wages and sometimes without benefits. One local manufacturer that conducted a deep layoff 20 months ago is now offering their former workers a chance at their exact same jobs…but at 50 percent of what they were paid before, and without pensions or seniority.

Increasing household costs. Grand Rapidians are having to take their cashier jobs and figure out how to use them to cover increasing costs—since our current economic depression has not been accompanied by price deflation. Food prices in Michigan are up again, after falling slightly last year. But it’s our utility costs that are the current budget-busters. One example: our electric rates went up over 14 percent this year alone, and between 20 to 30 percent in the past 22 months. We can thank new state legislation that allows our utility companies to start charging consumers for increases before they have even received approval for the changes.

And city residents in Grand Rapids pay water costs that far exceed those in the comparable regions. Areas like Kentwood, for example, have the same water service as Grand Rapids residents, but pay less. Our water costs have increased 11.4 percent in the past year. You can find the reasoning, padded in incomprehensible double-speak, in a 245-page report online.

Outraged? Call manager Joellen Thompson at 456-4550 and see if she’ll return your call. But don’t hold your breath.

As we approach Labor Day, it’s painful to look at the Grand Rapids scenario: Nine years of economic downturns and layoffs, increasing taxes, increasing wages for city workers, slashed wages for everyone else, and price-gouging food and utility prices. People are scared to speak up, scared to object, and scared to stand up for their rights. Some hope that if this or that political party dominates in the upcoming election, things will change. They won’t. All politicians are the paid creatures of the capitalists—special interests and campaign contributions see to that.

But we do have one card left in our deck. That’s the choice to put a stop to this now. We can only do that collectively, with one voice, with one sense of purpose.

This Labor Day, think about how different life in Grand Rapids would be if you and your fellow workers could control production for the good of the people, not for the good of the CEOs at the top of the economic food chain. It’s time to choose, and time to act. We simply can’t hang on much longer.

6 Comments leave one →
  1. Micah permalink
    August 31, 2010 8:10 pm

    A great article overall, Kate, except for one piece: the attacking of city workers. They’re getting paid what they deserve! It’s not their fault the rest of the city is getting screwed.

  2. Kate Wheeler permalink
    August 31, 2010 9:10 pm

    Sorry, Micah, but I don’t agree. GR City workers’ salaries and benefits are way, way out of line, especially compared to what people in similar jobs are being paid in Detroit or other Michigan cities. We are bearing the brunt of a salary/wage system that has been vigorously, if not viciously, protected at a time when many taxpayers are underemployed and uninsured and services to our community are being cut.

    Is it necessary to pay a garbage truck driver more than many area college professors make? Because that’s the level of salary we’re talking about. The average salary for Grand Rapids city sanitation workers is $58,538. An associate professor at GVSU with a PhD can expect to earn $56,000 or less.

    There’s an emergency dispatcher on staff at the City of Grand Rapids who is paid over $131,000 a year. The average parking lot attendant makes $46,500. I can tell you that there are paralegals in this city with two years of post-grad training and ten years of job experience who make far less money than that and work up to 80 hours a week.

    I’m not saying that our city workers don’t deserve to be paid adequately or receive benefits. But these salaries are *outrageous.* And we’re footing the bill for them. Every few years the city asks for a millage, says if they don’t get it that they’ll have to cut the police department staff, and everyone votes for it. Then all the city workers get yet another big, fat raise. That’s how their pay structure has gotten so out of line with wages in other cities in the state and across the country. Those salaries need to be slashed down to something reasonable–we can’t afford in this economy to be paying people at that level.

  3. Kate Wheeler permalink
    August 31, 2010 9:39 pm

    Sorry–forgot to add one other point. I was going to say that you can also compare apples to apples with these salaries. According to the US government, the average pay for a parking lot attendant in the US is $18,732. Compare that to the City of GR worker who is paid $46,500. The average pay for an emergency dispatcher in the US is $35,759, with a senior level dispatcher averaging about $45,500. Compare that to the $131,000 salary of the GR City worker with the same job. The average salary of a sanitation worker in the US is $31,600. Compare that with the Grand Rapids City worker who is making $58,538.

    I think the trend here is clear.

  4. ben permalink
    September 1, 2010 10:47 am

    michigan added 20,000 manufacturing jobs in july

    jeff would say though probably manufacturing crap we don’t really need
    do you have to ruin everything jeff? ha ha


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