Co-authored with Chris Kui, Executive Director of Asian Americans for Equality
In a recent private meeting with dozens of mom-and-pop nail salon owners since investigative reports on unsafe working conditions at these shops, one thing became clear -- there is a systemic gap between training and job placement that leads certain bad operators to take advantage of immigrant workers, many of whom operate in New York's shadow economy.
In response to the recent scrutiny, many nail salon owners simply told their workers to stay home. The workers themselves were afraid of the increased scrutiny, and the simple mentioning of a crackdown on nail salons has already pushed many small business owners and workers further into the shadows.
According to statistics by the New York Asian Women's Center, over 50% of females caught up in the New York City underground sex trade market has previously worked in the nail salon industry. So when these female immigrant nail salon workers are told by their owners to stay home and then can't pay their rent or put food on the table, what will they do for immediate money?
Enforcing penalties upon any industry that is based on a shadow economy is tricky and it shouldn't be the only solution. There are hundreds of thousands of bartenders, waiters, waitresses, and delivery people who belong in the shadow economy where oversaturated markets plus customer apathy results in cheap products and services. As consumers, we are all guilty of contributing to this problem. For example, it costs $20 for a manicure in Manhattan. It costs $8 in Flushing. There is a reason for this - the shadow economy.
If our state and federal governments are serious about cracking down on shadow economy businesses that cut corners to meet the demands of consumers who seek cheap goods and services, we must offer alternative solutions to strict enforcement that involve investment by government and private foundations in order to transform the systemic problems of certain shadow industries toward long-term improvements.
For instance, we must first direct funds toward helping the thousands of, mainly immigrant female, displaced workers. We could create a government supported apprenticeship program with significant training funding that could create a better pipeline for nail salon workers from training and certification to job placement, bringing them out of the shadow economy, and out of the grip of certain unscrupulous nail salon owners.
In the nail salon industry, we see bad operators exploiting immigrant workers' need for training and experience by forcing them to work for nothing. According to a number of Korean and Chinese nail salon owners, there's a scarcity of nail technicians who can hit the ground running on their first day of employment. Even those who graduate from beauty schools and are state certified, according to many owners, need at least six months of real work experience before they can handle clients full time. The exploitation that occurs is exacerbated by the lack of a sustainable pipeline for nail salon workers going from training and certification to job placement.
Beyond government funding, we have an opportunity to remove this vulnerability by setting up third party, community-based workforce training and certifications for workers, in Korean, Chinese, and Spanish - the primary languages most accessible for this labor force. Working closely with community-based organizations, we are introducing new legislation called the Pipeline for New American Workforce which will authorize the Office of New Americans to employ third-party nonprofits that specialize in job placement to oversee the training and job placement of nail salon workers.
By removing the dependence of the nail salon workers solely on operators during the training and certification period, we help eliminate the ability for bad operators to abuse the situation while helping good operators nurture their work force.
There are those who will look at this approach and would rather see the market self-correct itself by rooting out the bad operators. There are those who believe extreme regulation and enforcement will shake up the industry and reset the pricing of services to market level.
Unfortunately, many immigrant experts and economists know that in the shadow economy, as long as there is customer demand, bad operators will find ways to work around the system. That is why we need to go beyond simple enforcement and think long-term.
We have an opportunity to turn an exploitable workforce into an empowered workforce. If we don't dig deeper for long-term solutions and just try to punish as many businesses as possible as a knee-jerk reaction, we may just end up hurting an entire immigrant workforce without providing new opportunities for them to make a decent living and realize the American Dream.