Monday, January 16, 2006

Hatchet Job, Cont'd.

by Tom Bozzo

One thing that highlights the pound-the-table (*) nature of the Chamber of Commerce's infamous sick leave study is that it spends a page and a half of a sixteen-page report (including the cover!) re-arguing the Madison smoking ban and purporting to show, using BLS data, "unprecedented" employment declines in the "leisure and hospitality industry" associated with the ban.

There are two problems with the analysis. First, the data from the Current Employment Statistics (CES) survey are for the Madison MSA, not just the city (remember that?), and in associating employment growth changes with city policies, the report shows no evidence of understanding the distinction. (The graph is introduced by a sentence reading, "Hospitality industry (the industry that includes hotels, restaurants, bars, etc.) has declined dramatically in Madison since the smoking ban took effect.")

The bigger problem is that more appropriate selections of "industry" paint a much different picture. CES data do indicate that "leisure and hospitality" employment declined 6.6% in November '05, the most recent data, versus November '04.

However, in the "accommodation and food services" classification — a subset of "leisure and hospitality" — the year-over year employment increased 4.0%. The arguably even more relevant "food services and drinking places" classification shows an employment increase of 5.6%.

Graphs to follow once I have time to get the raw data into Excel.

Month-to-month employment changes for an area such as Madison need to be taken with a grain of salt, as the data are sample-based and subject to considerable variation even for an unusually large sample like the CES. But the appearance is that the data series was chosen to prove the Chamber's point on the smoking ban.

Meanwhile, Brenda Konkel rightly notes the report's general tone of callousness.

(*) Remember the old saw about lawyering: When the facts are on your side, pound the facts; when the law is on your side, pound the law; otherwise, pound the table.
Really, the same data you just complained about you decide to use to support your argument?

Besides, its the long term effects that matter. Over time, as more restrictions are placed on businesses in Madison, a greater percentage of businesses that are planning to open will open elsewhere (in the burbs) and a greater percentage of businesses will close shop or decrease in size. Customers will flock to the areas outside the city as better services are available. This has happened all over the US and it happens again and again and again as people with too much time on their hands get on city councils and micromanage how the public lives their lives (including how business owners run their businesses) without realizing the real damage they are doing to the future of their city.

BTW, Konkel's examples are callous too - somebody's appendix asplodes because they didn't have sick leave or a parent has to stay home because their kid couldn't go to daycare because of chickenpox (which kids are vaccinated for now anyway (unless Konkel doesn't believe in vaccinations)) (BTW, what minimum wage worker could afford daycare in Madison anyway?).

This is a bad law and deserves to be shot down.
Bryan: You are reading too much of a "complaint" into my "grain of salt" comment. Nor did I make an argument about the effects of the smoking ban from these data, other than to suggest that the Chamber cherry-picked its series.

If it's long-term effects that matter, then I'd expect that a lot of employers would find that they had happier, healthier, and more productive employees for just a few cents an hour.

I fail to see what makes Konkel's examples 'callous.' Part of the health care problem is that people without insurance end up in ERs with problems that could have been addressed via preventive care. Moreover, unexpected health bills plus lost wages are a major route to bankruptcy for people with lower incomes.
If giving employees 9 sick days per year is a net positive to the bottom line, businesses would have already adopted this approach. In the smoking ban argument, you got around a similar problem by claiming that it's only a net positive if all businesses in an area would have banned smoking. However, there is no similar workaround for paid sick days. If it's a net positive, individual businesses could implement similar policies (which many already do, BTW). For some businesses the new law will be a negative else they would already be implementing it.

BK's comments are callous, because they show a total disregard for the truth. Find me one example of a person dying because they could not take a day off work from some sh*tty job. It has never happened, and if it has, that person had to be a fairly large dumbass. She's playing on fear a la Pres. Bush.

As for the chicken pox example, the only way anybody could afford daycare in this city is if they already have a good job that allows a person to have paid sick days or somebody who could absorb the loss for unpaid leave. Of course, perhaps the city council should force employers to provide free daycare to resolve this problem.... And even if there were examples like BK suggests, these would be very few and the proper way to address them would not be to force almost all businesses in the city to provide paid sick leave, but to provide help directly to the people who actually need it.
Many, if not most, businesses do offer at least some of their employees that amount of "sick" leave. Mine gives me 23 days of leave that counts towards the mandate. (Our part-timers accumulate leave benefits at double or more the rate of the mandate, depending on the length of employment.) So it must be good for our bottom line, no?

Of businesses that don't offer such benefits, who knows whether anyone has actually given the matter of whether it's a net benefit consideration?

Meanwhile, who said anything about people dying? (Or, is the risk of death the only thing that warrants an intervention?) Konkel's point is that encountering serious health problems without leave rights leads to economic hardship, which strikes me as being true on the face of it. Illness and injury are known to be major contributors to bankruptcy, for instance, and income shocks can lead to surprisingly strong downward mobility in the next generation, too.

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