All Commentary
Saturday, June 1, 1996

How Government Destroys Jobs for Poor Women

Labor Market Regulations and Taxes Limit Employment Opportunities

Dorothea Eiler is a freelance writer who lives in San Diego and Rosarito, Mexico. Her book Baja Gringos is available in book stores nationwide.

California’s Director of the State Department of Social Services, Eloise Anderson, created quite a stir when she insisted that welfare mothers would be better off working than collecting from the government. Surely there are very few who totally disagree with her, but the fact is that the government has made it very difficult, almost impossible, for women coming off of welfare to get a job.

Traditionally in Western civilization there have been two ways in which unmarried women, with or without educations, could support themselves. One, of course, was the world’s oldest profession, but the respectable one, the one with even a slight hope for a decent future was domestic service, from laundress or cook to nanny. In recent years the government has made the second choice virtually unattainable. In fact, labor regulations have actually eliminated most of the market for casual domestic service.

Until a couple of decades ago, poor women did housework to put food on the tables for their families. Perhaps they didn’t approach the job with much enthusiasm, but doing what must be done for themselves and their families must have produced more than a little satisfaction and self-esteem. Domestic workers were often employed by five or six households per week, often at very low wages. But cash wages went directly into workers’ pockets, and nobody reported the income to the government. In those days casual domestic labor was exempted from Social Security and other taxes. In effect those workers were probably at least as well off as most are on welfare today.

Of course they didn’t have any “benefits,” such as Social Security and health insurance. If a domestic worker was injured on the job, the employer often took her to the doctor for care, and though serious illnesses were a tragedy for all concerned, employers, family, and friends usually joined together and did what they could to assuage the difficulties.

Thus many women, who would have been otherwise forced to go on welfare, found a way to care for and support their children. Instead of relying on daycare, they often took care of each other’s children. But, then again, babysitters were not licensed, so they could charge very little. Sometimes the babysitter simply picked up a little “pin money” to supplement her husband’s salary. Or domestic workers might take their children to work with them, teaching the youngsters the skills of housework and the dignity of earning a living as they were growing up. These children were then available to help in times of health or financial problems.

This freedom to work without interference from the government kept women off welfare. It also enabled many households of limited affluence, young mothers, and elderly people on fixed incomes to afford someone to help with the non-routine chores, thus making their lives a little easier. There was an extensive market for casual domestic labor.

But now to hire a woman for casual labor in a home the employer must report to the state and federal government any wages paid. Legal identification must be established. Payroll forms must be filled out every quarter, and in many cases checks must be sent for taxes withheld. The elderly couple or the busy young mother, who cannot afford both domestic help and accounting help, are often reluctant or even unable to handle the bookkeeping chores involved in the employment hassle. That simply eliminates all but the very affluent from becoming employers at all!

Some employers of domestic labor, those who can afford to pay more, now turn to cleaning services, but those businesses are burdened with workers’ compensation insurance, liability insurance, minimum wage laws, health insurance, OSHA regulations (did you housewives know that window washing is considered a hazardous occupation?), and EEOC problems, thus pricing the service out of the market for a large segment of possible employers.

Such rules and regulations also make hiring domestic workers more difficult, thereby further limiting the jobs available in the field. These sophisticated services are no substitute for the word-of-mouth, over-the-back-fence employment agency that used to operate. The informal word-of-mouth system of hiring and firing often made allowances for the good domestic worker who was no longer young or was not very bright or not very fast. Such a worker could be tolerated by many individual employers, but is not suitable for hiring by a cleaning service. I once had a household cleaner who worked for me for years before I found out she was totally illiterate!

The market remains for unskilled, uninsured, and unbenefited help. And there are still countless immigrants who are willing to slip in to work without benefits or government protection. They wouldn’t have those advantages in their native lands, and they do not understand the laws and rules they are breaking. They fill the market niche that the government has made impossible for U.S. citizens to fill.

It’s all very easy for the politicians to say they will set a limit of five years on welfare recipients. And it’s very true that welfare mothers would be better off working for a living. But where are these women going to work? One of the lowest rungs on the wage-earning ladder has been largely removed from the grasp of the women who would reach out for it. In making domestic jobs so difficult to provide, the government has limited poor women’s opportunities more than liberation has broadened them.