Bloomberg claims that the legislation, which would provide five days of paid leave for employees of companies bigger than 15 people, would “hurt small businesses and stifle job creation… Supporters claim it will only take effect if the economy is healthy, but there is never a good time to make New York City less competitive. The bill is short-sighted economic policy that will take our city in the wrong direction, and I will veto it.”
It’s a good thing that the council has enough votes to override Bloomberg’s veto, because his reason for opposing the law doesn’t add up. Several studies have demonstrated that paid sick leave has no effect on job creation. In fact, a survey by Public Citizen found that when San Francisco enacted paid sick day legislation (a bill that required far more businesses to comply), it saw a jump in business expansion and employment growth (PDF):
But after implementation of the paid sick-leave law, San Francisco experienced an increase in employment. A study by the Drum Major Institute found that employment in San Francisco increased 3.5 percent between the start of 2006 and the start of 2010. In San Francisco’s five closest neighboring counties, employment fell 3.4 percent during the same period. The same study found that despite predictions to the contrary, the number businesses in San Francisco grew by 1.64 percent between 2006 and 2008 while falling by 0.61 percent in neighboring counties. San Francisco also experienced growth within both large and small businesses, and within the retail and food service industry during this period. (These industries expected to be affected most by the ordinance.)
The impact on businesses themselves was minor. A majority reported that understanding and implementing the ordinance was either “not difficult” or “not too difficult.” Additionally, while only 14 percent of businesses reported a negative impact on profits, more than 70 percent reported that the law had either no impact or a positive impact on their profitability. Productivity, and thus profitability, suffers when workers are forced to come to work when they are sick. One study on the impact of illness on productivity estimates that businesses lose twice as much money to workers who show up at work while sick than when workers stay home due to an illness.
Another study of Connecticut, done by the Center for American Progress, found much the same thing, noting that “full use of this leave would cost an employer only 0.4 percent of their sales revenue on average. Without paid sick days, employees come to work unhealthy, costing employers $160 billion per year due to lower productivity levels.”
There are myriad benefits to paid sick leave outside of workforce productivity; it helps families, is good for morale, and helps people recover from illness. Business efficiency can’t be the only end goal. But if Bloomberg is inspired by business interests alone, then he should still feel compelled to support the law. Three million Americans workers missed a day at their job because of illness in the month of February alone. It’s likely many did so without pay; 40 percent of private sector workers and 80 percent of low-income workers have no paid sick leave, and are likely to pick coming to work sick over missing a day of wages. That means they’re spreading illness to customers, getting more people sick, and being less efficient overall.