An economic tragedy is unfolding in the "hub" of the new global economy -- the Inland Empire region of southern California -- and it serves as a living reminder of the need to pass the Employee Free Choice Act to give working Americans a realistic shot at the American Dream.
While the rest of the country is going through a recession, the Inland Empire is in the grips of a depression. Just east of Los Angeles in San Bernardino and Riverside counties, the region led the nation in economic development and population growth as recently as three years ago. Now it leads the nation in unemployment and ranks third in foreclosures.
The collapse of the housing market started the downturn, but the reason this area is now ground zero of the Great Recession is the failed business model of its dominant industry: warehousing and distribution for the nation's biggest retailers.
The Inland Empire is home to the largest concentration of warehouse space on the planet, 366 million square feet and growing. More than 43% of all US imports come through the ports of Los Angeles and Long Beach, and over three-quarters of this cargo takes at least one trip through an Inland Empire warehouse. The top five companies with the most warehouse space are the biggest retail corporations in the nation: Walmart, Target, Home Depot, Lowes, and Sears/Kmart.
As the region's manufacturing base disappeared -- Southern California lost over 361,000 manufacturing jobs between 1990 and 2005 -- it was replaced with new jobs hauling, sorting, packing, and shipping the goods that are now being manufactured in China and other parts of the globe. As the key hub in the "goods movement industry," the warehouses and distribution centers of the Inland Empire employ more than 100,000 workers.
The goods movement industry was supposed to provide a path to the middle class for workers in the region, but instead a majority of the workers in these warehouses are hired through temp agencies or third-party logistics firms, paid low wages, receive few benefits, and have no job security. Temporary employment in the area grew by 575% since 1990.
This was a bad situation for working families when times were good, as many workers made less than $8.49 an hour according to a recent report. Now that times are bad, it's been a total disaster. Many temporary workers have found themselves getting fewer and fewer hours, until they become virtually unemployed, but without any unemployment benefits at all, not to mention severance pay, recall rights, or even any advance notice.
The area's fractured employment model has turned a recession into a depression. There are now tens of thousands of laid off warehouse workers with no unemployment, no safety net at all, just barely getting by.
Ignacio Sanchez lost his warehouse job in October and now struggles every day to feed his family. Ignacio was a "lumper," unloading the large containers that come to the warehouses from the ports. He now spends his days watching over his five year-old daughter and searching dumpsters for cans and food. When he finds food, he has to hide where he got it from his daughter because if she knew, she might not eat it.
Olga Romero, who worked 14 hour days repacking shoes at a warehouse, was laid off three months ago with no warning or cause and has been unable to find work since. She can only afford to feed her family rice and beans for dinner, and worries about the days ahead. "There's no future with these bad jobs," she says. "I need a real job to take care of my family, not another temp job."
As conditions worsen in the Inland Empire, the big retail companies that created the broken business model have not accepted responsibility for the damage they have done. They hide behind the temp agencies and third-party logistics firms in an elaborate shell game.
This is typical of an industry that has not acknowledged responsibility for any part of its supply chain, from the workers in the factories in China and Southeast Asia to the temp warehouse workers in the Inland Empire to the retail staff working for the minimum wage. And make no mistake about it: many big corporations would spread this failed fractured temp system to every corner of the country if they could.
Even when the economy recovers, there will still be no hope of achieving the American Dream for the warehouse workers unless the system is changed. It is time for Walmart, Target, Home Depot, Lowes, and Sears/Kmart to take responsibility for the workers who helped them become so profitable and to treat them with dignity and respect.
A new worker movement is growing in the Inland Empire to hold these companies accountable. Thousands of warehouse workers are joining together in Warehouse Workers United to change the broken system. They are calling for passage of the Employee Free Choice Act, which will make it easier to form a union and negotiate for higher wages, better benefits and a new employment system that treats all workers fairly.
More than one million new jobs will be created in the goods movement industry in Southern California by 2030, according to projections. For only pennies on the dollar, the retail industry could turn them into high quality, middle class jobs that support a family. These are jobs that cannot be outsourced and could play a major role in revitalizing our reeling economy. But only if the nation's biggest retailers are held responsible for the treatment of all the workers in their supply chain.
This struggle is just one of the many across the country that illustrate why American workers need the Employee Free Choice Act. You can help by telling Congress to pass this important bill. Sign the petition.
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