Workers' Wages Sink as 'Domestic Outsourcing' Grows

http://www.nbcnews.com/business/economy/workers-wages-sink-domestic-outsourcing-grows-n118441

A new report from the National Employment Law Project says that domestic outsourcing makes it harder for workers to organize and effectively lets companies pass the buck on taxes, benefits and worker safety.

“This business model of subcontracting has become increasingly ubiquitous,” said Ruth Milkman, sociology professor at the City University of New York Graduate Center.

This kind of scenario is common, NELP says. “Once outsourced, workers’ wages suffer as compared to their non-contracted peers,” NELP said. The drop can be steep, the group said: Janitors’ wages fell by seven percent, port truck drivers’ pay dropped by 30 percent and food service workers lost $6 an hour in wages.

As in the private sector, government contract workers earn less: In a 2009 report, the Economic Policy Institute found that more than twice the number of federal contract workers didn’t make enough to lift a family of four above the poverty threshold when compared to workers employed directly by the government.