Initiative 436, a mandatory paid leave initiative for full-time, part-time and temporary employees, will drive up the cost of doing business, make it harder for our local retailers to compete with large corporations, and may ultimately do more harm than good.
That measure, a petition backed by millions of dollars from interest groups outside Nebraska, will appear on the November ballot. Because such initiatives must be written narrowly, this proposal amounts to a one-size-fits-all government mandate, which will disproportionately hurt small businesses.
Local employers appreciate the difficulty individuals face in balancing family and work obligations. These working men and women have families. They often have to choose between running their business and serving their community or watching their kids at extra-curricular activities and taking care of sick loved ones. Often, serving their communities and paying employees trumps taking care of their own personal health.
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But that doesn’t mean there is nothing we can do. A better solution would be a bipartisan statewide paid leave policy that moves through the regular legislative process. Such a proposal, written by the folks we elect to craft laws, could look more like our state unemployment program where benefits actually follow the employee.
While most employers offer paid leave to full-time employees, 436 extends this benefit to part-time and temporary workers and is being offered on the heels of a mandatory statewide increase in the minimum wage (also funded almost entirely by out-of-state dollars).
The cost of mandates is absorbed to the greatest extent possible, especially in highly competitive industries like grocery, food service and convenience, but inevitably Nebraskans will see higher prices, shortened hours of service, scarcer hours and fewer jobs. A new paid leave mandate is also likely to erase any flexibility currently enjoyed as employers are forced to focus on record-keeping, compliance and legal implications.
As Arthur Diamond, a professor of economics at the University of Nebraska Omaha stated in a October 2022 letter to the editor, “… the main job creators in our economy are the entrepreneurial, fast-growing, mainly young firms, sometimes called the 'gazelles.' When these firms flourish, jobs are created, and wages rise. If we want to improve the lives of the least well-off, the most effective way to do that is to create an economic environment in which the gazelles are many and healthy. One way to do that is to show restraint in taxation and regulation.â€
In one conversation recently, it was made clear to me many proponents of mandates like those found in 436 do not care if entry-level and lower-skill jobs are automated, forgetting these jobs provide the opportunity for young people, those with disabilities and folks transitioning back into the workforce to gain skills and experience. It’s also a lot easier for large businesses to invest in technology; it can be a costly and risky endeavor for our Main Street mom-and-pops.
These government mandates, like taxes and regulations, are borne more easily by the big guys. Perhaps the wealthy DC institutions paying for these initiatives really do want to do away with lower-skill, entry-level jobs. Let’s hope they don’t do away with our small businesses in the process. Vote no on Initiative 436.
