Take a seat in the Break Room, our weekly round-up of labor news in Minnesota and beyond. This week: Workers’ paychecks are increasing much faster than prices; 62,000 Minnesotans work in green(er) energy; U of M and graduate student union at impasse; fair pay icon Lilly Ledbetter dies; and Home Depot execs must work retail shifts.
Wages far outpace inflation
Wages have risen twice as fast as inflation on average over the past year in Minnesota, which has pushed workers’ buying power back to where it was before inflation took off in 2021, according to data released by the state Department of Employment and Economic Development.
“This is especially encouraging news for everyone who’s been reminded of inflation during trips to the grocery store, the gas station and elsewhere,” said DEED Commissioner Matt Varilek on a call with reporters on Thursday.
Wages in Minnesota increased 4.9% on average — slightly higher than the 4.6% growth nationally — over the past year to $38 per hour for private sector workers, while the consumer price index rose 2.4% over the same time.
Zooming out to include the recent years of high inflation, wages grew 15.1% in Minnesota on average over the past three years while inflation over the same period was 14.9%. That’s why many workers may feel like they’ve been trying to run up a down escalator since the pandemic.
Wage growth has been strongest for lower-paid workers, with only those in the bottom half of the income scale seeing real wage growth through peak inflation. Those gains for lower-paid workers helped decrease economic inequality but are now leveling off, according to a report by the Federal Reserve Bank of Minneapolis.
Unionized workers leveraged their collective bargaining power to secure much higher pay raises than nonunion workers. Union workers struck hospitals, auto plants and nursing homes and won double-digit pay increases.
With inflation tamed, the Federal Reserve has begun lowering interest rates to head off slower economic activity for the first time since 2020, which will make borrowing money for big purchases like cars and homes more affordable to everyday workers.
DEED also announced strong job growth in September, with employers adding 6,300 jobs. Unemployment ticked up 0.1% to 3.4%, but remains lower than the national rate of 4.1%.
Green(er) energy jobs rebound after pandemic
Green energy jobs surpassed 60,000 in Minnesota for the first time since the pandemic, spurred by generous federal subsidies in the Inflation Reduction Act and the state’s law requiring 100% of energy to be carbon-free by 2035, according to a report released this week by three industry groups.
The analysis of employment data found green energy jobs grew 4% in 2023, far surpassing job growth across the entire economy.
The industry groups behind the report — E2 (Environmental Entrepreneurs), Evergreen Climate Innovations and Clean Energy Economy MN — include broad swaths of workers not typically thought of as working in clean energy. Two-thirds of the clean energy jobs counted in the analysis — 44,500 — are employed in energy efficiency: manufacturing efficient appliances, installing heat pumps and constructing buildings with efficient materials like ‘low-carbon concrete.’
The analysis also tallied 9,000 jobs in renewable energy like solar and wind, 4,500 jobs in electric vehicles, 3,000 jobs in grid and storage, and 700 jobs in ethanol and other biofuels.
U of M and graduate student union at impasse
Negotiations between the University of Minnesota and the newly formed union representing around 4,000 graduate students broke down this month after a year of bargaining. The contract will be the first for graduate students, who voted by a wide margin to unionize in April 2023 after five failed attempts going back to 1974.
The two sides, which entered mediation in August, are at an impasse over whether about 1,500 graduate students and trainees on fellowships should be added to the union after the Legislature passed sweeping changes to the law governing unions at the university earlier this year.
The new state law says graduate school fellows and trainees are part of the graduate assistant unit, but the university argues that fellows are not public employees because they do not perform work at the direction of the university.
The Graduate Labor Union, United Electrical Local 1105, says the university agreed to continue negotiating over wages, benefits and other issues while the state Bureau of Mediation Services — which oversees public-sector unions — makes its ruling on the graduate fellows.
But the union says the university reneged after the last negotiating session on Oct. 10 by asking BMS to issue an order suspending negotiations and preventing any changes on wages or other employment conditions until the agency reaches a decision.
“Because of the university’s dishonest decision to halt bargaining after 13 months of productive negotiation, graduate assistants must continue to endure low pay, discriminatory fees, and no recourse for abuse in the workplace,” the union wrote in a statement.
BMS Commissioner Johnny Villarreal said in an interview that it’s typical for the agency to pause negotiations when there is a dispute over who is included in the union, especially in cases where only one side has asked for the review and the workers don’t already have a contract in place.
A spokesman for the university declined to comment beyond an update posted to its website.
Fair pay fighter Lilly Ledbetter dies at 86
Lilly Ledbetter, who became an American icon in the fight for equal pay after taking on her employer for paying men more than she for the same job, died on Saturday in Alabama at 86 years old.
Ledbetter’s battle against Goodyear began near the end of her 19-year career at the tire plant, when she received an anonymous note that men in the same supervisory roles were earning as much as 40% more, the New York Times reported in their story on her death.
Ledbetter sued in 1999 and a jury awarded her $3.8 million in back pay and damages. The judge in the case reduced the award to $360,000, and then the verdict was overturned entirely on appeal. A narrowly divided U.S. Supreme Court upheld the ruling against Ledbetter, holding that the Civil Rights Act required her to have filed a complaint within 180 days of her first unequal paycheck.
Ledbetter had found out about the pay discrimination too late, and never received a dime.
Justice Ruth Bader Ginsburg, in her dissent, argued it was virtually impossible for Ledbetter to have known she was being discriminated against since salaries are usually secret. Ledbetter said Goodyear barred workers from discussing pay.
Ginsburg urged Congress to change the law, which they did when Democrats swept control of government after the 2008 elections. The Lilly Ledbetter Fair Pay Act of 2009, which extends the statue of limitations on fair-pay claims, was the first bill President Barack Obama signed into law as president.
“Lilly Ledbetter never set out to be a trailblazer or a household name. She just wanted to be paid the same as a man for her hard work,” Obama wrote in a statement.
Union petitions surge
Workers are continuing to unionize at high rates since the labor movement’s renaissance the past few years.
The National Labor Relations Board, which oversees private sector unions, reported that petitions for union elections are up 27% across the country this fiscal year, which ended in September. The agency received 3,286 union election petitions in 2024, more than double the petitions filed in 2021.
Joe Biden, who aims to be the most pro-union president in history, heralded the news and boasted that he is the first president in five decades to see an increase in union petitions.
“When unions do well, all workers do well and the entire economy benefits,” he said in a statement.
In Minnesota, unions filed 85 petitions for representation in 2024, more than twice the 38 petitions filed in 2021.
Despite enthusiasm and public support for unions, the share of workers represented by unions is at an all-time low in modern American history. Union membership ticked down nearly a full percentage point from 14.2% to 13.3% in Minnesota in 2023, inching closer to the national average of 10%.
Home Depot executives must take a retail shift
Home Depot’s corporate workers will have to work a full 8-hour shift at one of its retail stores once every three months in order to better support its retail staff, Bloomberg News reported.
“We need to stay connected to the core of our business, so we can truly understand the challenges and opportunities our store associates face every day,” CEO Ted Decker said in the memo obtained by Bloomberg.
