The Minimum Wage of $15: A Case Study

 

Industrial sewing machine used in manufacturingThe Minimum Wage Debate

The CT State Legislature finally passed a $15/hour wage after a contentious debate as reported in this article by and of the CT Mirror. The debate was contentious, of course, because of the sharp divide between Republicans who put the concerns of business owners at the top of their agendas and majority Democrats who favor the cause of workers. This debate is essentially about what constitutes a “fair Wage” in CT.

A Case Study

I have closely followed this process because of my commitment to basing the pay of the contractors who work with me at a minimum of $15/hr. I have made this commitment because my business, United Sewing and Design, is a social enterprise which focuses on workers first in addition to customers. However, like any business owner, I have to balance the needs of my workers against the opportunities to earn income. l won’t do anyone any good if I don’t stay in business. For example: as a manufacturer, the work we do is often for resale. Therefore, simply put, there is a limit to what our customers can afford to pay us. Often, our customers allow the retail market in which they compete to determine their price and thus, the amount they can afford to pay for manufacturing. This is not anything new.

So far, in order to reach and sustain my pledge to pay a $15 an hour wage, I have had to turn down work from several customers because the retail price of the item being discussed was not high enough. This hasn’t negatively affected our bottom line up to this point. Additionally, I have begun to actively seek out work that sells at a higher retail price and am investigating manufacturing fields where retail price is not a factor. These haven’t been difficult decisions, but I’m making them during the formative stages of business development while I am still scaling up.

Many business leaders are not happy about the gradual increase to a $15 wage. They have legitimate concerns, which I share. But, I feel that the $15/hr wage which approaches a fair wage, is a necessary start to strengthening our entire state economy.

To frame this debate and the action by our legislature, pick up this book by Zeynep Ton, read this about what counts as the “middle class” in CT according to the Census Bureau, and this about what supposedly is a “living wage” in Hartford County. Hint: it will take until fall of 2021 to reach a so called “living wage.” Also, $15 an hour will in no way approach a middle class income in CT.

 

 

 

United Sewing and Design 2018 Social Enterprise Report

United Sewing and DesignEach year in CT, social enterprises are required to report their progress toward fulfilling their social impact goals for the previous year. This post is the United Sewing and Design report for 2018 about our progress toward meeting our business goals which are:

  • hiring individuals who have barriers to getting and keeping well-paid employment and,
  • diverting materials from the waste stream into our business and preventing materials from our manufacturing processes from entering the waste stream

Goal 1:  Hiring individuals who have barriers to getting and keeping well-paid employment

Our independent contractors have included individuals with social and emotional disabilities, and full time caregivers for individuals who need intensive support in daily life. I work with social service agencies and non-profits to identify individuals who are trustworthy and dependable, know how to sew, have the appropriate workspace and equipment, and are experiencing barriers to getting and keeping well paid work.

This year we added formerly incarcerated individuals to our pool of collaborators. I connected with the Wesleyan University Center for Prison Education to identify ladies who were placed at the York Correctional Institution in Niantic. This was an important goal for us because the inmates at York sew a variety of products including t shirts, prison uniforms and bed linens so they are already trained for the manufacturing skills we need.

In 2018, our pay to contractors increased 527% over 2017. United Sewing and Design paid contract labor wages to independent contractor “M.I.” from Middlesex County. (I do not name my contractors to preserve their privacy.) Although this increase is significant, we consider it essential to grow sustainably and look forward to steady growth for the rest of 2019. I interviewed two new contractors, L.A. from Hartford County and L.M. from New Haven County, both of whom were referred by the Weselyan CPE, who will be working with me in 2019. Much of our work at the moment is geared towards developing and prototyping  patented products for individual designers. I anticipate that these contracts will grow into steady manufacturing work for our contractors.

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How Building Value for Employees Builds a More Valuable Business

All business owners know that the key to long term success is for businesses to deliver value to customers and investors. But, have you considered how essential it is to deliver value to your employees, what that value looks like to them and what the impact of that value will be on your business?

Fortunately, we don’t have to figure out how to deliver value to our employees. Zeynep Ton has already done that for us. In her Good Jobs Strategy, Ton laid out the steps we need to execute, discussed in my last blog post. Here’s a recap of her guidelines paraphrased.

1. Concentrate on fewer, higher quality products.
2. Standardize work requirements so that workers can have the freedom to work more efficiently.
3. Train workers in more than one task to reduce fluctuations in workloads.
4. Have more workers on hand instead of fewer, cross training them so that they can be employed full time on regular schedules.

 The point of these guidelines is to create value for employees. To them, a valuable job would have fair pay; a stable schedule; management that is respectful; engaging tasks that are aligned to the worker’s abilities (emotionally and physically) and intellect;, and, I would add, accessibility by reasonable transportation. Structuring a new business in this way or restructuring an existing one, results in a mindset for owners in which employees are viewed as assets instead of expenses. Here’s how these guidelines function when applied in my own business, United Sewing and Design.

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How You Can Change Your Bad Consuming Habits and Not End Up Naked

Shop at a Locally Owned Boutique
Photo by Clark Street Mercantile on Unsplash

If you’ve been paying attention to global trade issues lately, you’ve undoubtedly run across discussions about fair wages also known as a “living wage.” Simply put, a living wage is a close approximation of the amount of money it would cost to support a single person or family in the area in which they live. This well written article, by on racked.com about the apparel giant H&M, discusses why they probably aren’t paying their workers a living wage, what it means to make sure a labor force benefits from good pay and how you can make a difference. Please take the time to read it and visit the great links embedded in there. When the people you’ll read about who make the apparel you buy and wear live with their families on the other side of the world, it’s easy to put them out of your mind. However, your consumption of a $10 t-shirt or $20 pair of pants at H&M, Target, Uniqlo or other importer of apparel manufactured overseas impacts the wages of those workers. Your bad consumption habits are denying them a living wage.

The lack of a living wage and safe working conditions for the workers who manufacture over 90% of the apparel available for us to buy in the U.S. is nothing new. I’ve been covering this issue in my lectures, writing and social media for over a decade. So, let’s skip to the questions I know you’re going to ask, “Why should I care? I can’t change what’s in the store to buy. Isn’t it cheaper to live there anyway? I don’t set the prices. I’m just one person. How can I come up with the solution?” Here’s an answer you can use, with some simple steps you can adopt that aren’t too difficult or too expensive.

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United Sewing and Design: Report on Employment and Environmental Impact 2016-2017

Tote bags with phone pockets and zippered pouches handcrafted for White Horse Style from reclaimed vinyl banners.
Tote bags with phone pockets and zippered pouches handcrafted for White Horse Style from reclaimed vinyl banners.

As part of their compact with the communities they serve, social enterprises publish a report to document their impact in the areas they focus on. As a social enterprise, the two areas that United Sewing and Design focuses on are creating work opportunities for marginalized individuals facing barriers to achieving well paid employment and manufacturing products with materials removed from the waste stream for our line “White Horse Style.” (For a portfolio of White Horse Style products visit this page.) Currently, United Sewing and Design works with independent contractors to manufacture products for individual, corporate and non-profit clients. For a profile on Green Banana Paper Company, one of our clients whose company manufactures accessories from recycled banana fiber, click here. For more info, be sure to check out the helpful links at the bottom.

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Why is My Business, United Sewing and Design, a Social Enterprise?

Social enterprises can support families.
Social enterprises can support families. Photo by kazuend on Unsplash

A common definition of a “social enterprise”(SE) could be, “a profit earning business that has, as its primary goal, creating the maximum positive impact possible in society and/or the environment.

As you can see, from this definition, SE’s are profit making unlike not-for-profits. And, unlike a typical business, their primary goal is not to produce maximum profits for owners and shareholders as in a typical for-profit business, but to create positive change in society and the environment. If you’ve read the “About” page on our website, or my profile on LinkedIn, then you know that United Sewing and Design is an SE.

First, a caveat with my explanation. My business is an LLC and so, is not registered as an SE according to the State of Connecticut. The reason that I chose not to participate in that designation, also known as a “B Corp,” is because in CT, to start a B Corp., you are required to register as an “S,” or “stock corporation,” to sell stock, have shareholders (obviously) and a board of directors. This earns significantly more in fees for the state. Additionally, it also requires a layer of reporting to the public about the social or environmental good created by the SE. My contention is that a business can be labelled by its activities as an SE and participate voluntarily in the public reporting without paying burdensome fees. We’ll see how that works out.

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