Editorial

Prevailing on pay

September 27, 2011 

No one wants to see North Carolina businesses go belly-up because a federal agency forces them to pay their workers more than they're worth. But how much is an hour of work really worth?

That's the underlying issue in a complaint that some in-state industries have with the U.S. Department of Labor and its new (court-ordered) wage scales for a relatively small group of foreign workers - perhaps 3,000 - who come to work here, legally, for designated employers under the federal program known as H-2B.

Some seafood processors Down East hire most of their seasonal workers this way, and the Labor Department wants them to raise hourly wages 50 percent, from $7.43 an hour to $11.18. That higher figure, supposedly, has been revised to represent the prevailing wage that the companies should be paying H-2B employees, but aren't.

The seafood companies and others in timbering, lodging, etc., who hire foreign workers seasonally, are understandably upset. They say they can't afford to pay more, and they predict dire consequences if the new rates take effect.

They also maintain, as a justification for hiring the foreign workers, that Americans won't do the work in question. Well, for $7.43, maybe not. But what about $11.18?

In other words, doesn't the lower wage under H-2B, plus a restriction that binds the foreign worker to one employer, amount to a distortion of the labor market, one that allows some employers to pay artificially low wages? Put another way, how are American workers supposed to compete with those brought in from countries where living standards are far lower?

There may be cases in which the Labor Department has got the new wages all wrong, and if so companies have every right to complain. Due to challenges in court, the department has, sensibly, postponed the rules for 60 days. The bedrock issue, however, is unlikely to change.

If Americans won't show up for motel housekeeping jobs, as one owner complained, perhaps the market is trying to send that employer a message. And perhaps a foreign-labor program in which wages have been set artificially low has been blocking that message long enough.

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