UC, the Wal-Mart of higher education?

published in the Berkeley Daily Planet February 1, 2008


If you love the University of California, you may be interested in a study released Jan. 15 by the Center for Labor and Community Research, titled, “Failing California’s Communities: how UC’s low wages affect surrounding communities.”

For those who pay attention to UC’s labor issues, the story is depressingly familiar. This study of zip codes and census data for roughly 20,000 low paid UC service and patient care employees at ten campuses and five hospitals asked the question; if UC paid market-rate wages, what would be the economic impact, or “multiplier effect,” and where would it show? It was produced with help from AFSCME local 3299.

The conclusions were clear, UC’s lowest paid workers are concentrated in low income communities most in need of economic improvement and UC is failing those communities by paying wages significantly below other colleges and hospitals in California (25 percent below overall). Comparisons were made to wages at regional hospitals and large community colleges. Citing a 2005 study by the National Economic Development and Law Center, one-third of UC’s 124,000 employees do not earn sufficient wages to pay for food, rent and other basic necessities and many are eligible for public assistance. Nearly half of UC patient care and service workers live in neighborhoods with a poverty rate 50 percent higher than those surrounding the campuses. In the Bay Area, the percentage is probably higher.

That study recognized that compensation practices of large employers affect entire communities. CLCR researchers note that as one of the largest employers in the state, if UC paid prevailing wages, it would have significant direct economic impact on struggling communities, including Oakland and Richmond, Inglewood and Hawthorne, plus 55 other working class communities near the UC system, where incomes run 15 percent lower than average. CLCR researchers conclude that, “the economic impact of UC matching prevailing wages is estimated to add $147 million in spending on local goods and services in those communities, create nearly nine hundred new jobs, add $9 million in state and local taxes and contribute $23 million in local business earnings.” Obviously, if UC were to provide market-rate wages, the social returns in low and moderate income communities would be far greater than any increase in sales of luxury goods in upscale districts adjacent to UC campuses from payoffs and perks lavished on top management.

Old-timers tell me UC used to say, “it is a privilege to work for the greatest university in the world, and because of our interest in public service and the egalitarian mission of the university, you will gladly accept a little less.”

More recently they said, “the economy is bad, we have to raise fees, tuition, health care costs, and no, no equity increases this year.” Seems every year, good or bad, UC’s primary customers, students, classroom educators and hospital patients take the hit.

This year the mantra is, “Arnold won’t give us the money, $14B deficit you know.” But the state budget slice for service workers at UC is just 8.6 percent, the rest comes from hospital revenues, the feds and non-governmental funding such as food services and parking. While tuition costs explode, students fees, the ultimate battering ram of UC’s excuses, provide barely 1 percent of service costs.

And I’m talking about unionized workers here, usually the most stable members of working class communities, whose wages UC is keeping down. People end up taking second jobs, putting their teen-aged children into the workforce and even collecting cans during breaks for a little extra cash.

Sources in current contract negotiations say the university has acknowledged that it is not about money, rather, they claim it would be “fiscally irresponsible” to raise workers pay to prevailing wage. That from a public entity with 22 billion dollars in net assets(assets minus expenses), up 18 percent in the last two years, a university system that is the largest recipient of Federal R&D funding in the nation, $4 billion last year alone. Current Berkeley Chancellor Robert Birgeneau recently cited low turnover at the bottom as justification for underpaying workers, and it is true that we need our jobs and UC can be a good place to work. However, we have less employment mobility than UC’s elite and are therefore ripe for exploitation.

Readers will be unsurprised that labor contracts within the UC system are in flux. One of the largest employers in every jurisdiction where it resides, UC seems determined to continue depressing wages, in contradiction of its stated ideals.

From the study’s conclusion; “What is at stake is the economic future of West Sacramento, San Pablo, Watsonville, El Cajon, East Oakland and other poor communities that would greatly benefit if UC made a greater economic investment in California’s communities.”

A PDF version of the study “Failing California’s Communities: how UC’s low wages affect surrounding communities” is at www.clcr.org/index.php.