Report criticizes JHU

Wage increases for hospital service workers at Johns Hopkins could help bring Baltimore out of economic "stagnation," according to a controversial study released by a local health care union.

"Consumption depends on people's incomes; raise income and consumption goes up," said Mike Kapsa, assistant director of the project. "This has a multiplier effect throughout the economy."

In the study "Putting Baltimore's People First," Service Employees International Union District 1199E-DC argues that increasing service worker compensation to a "self sufficient wage" -- calculated at $17.41 per hour for a family of three -- would raise the ers and spur city economic growth and development. The study devotes an entire chapter to Hopkins, which, according to the study, pays service workers on average only $10 per hour before taxes.

But Hopkins representatives, calling the study a piece of pro-union propaganda, contend that such a substantial wage increase could cut the workforce and eliminate some unskilled laborers.

"The union only wants us to see one side," said Howard Baetjer, Jr., a lecturer in the economics department at Towson University.

"Higher wages for some would mean fewer jobs for others. It benefits some at the expense of others," he said.

To fund such substantial wage increases, Hopkins and its peer institutions would have to cut unskilled labor, which would put many Baltimore city workers out of a job, said Baetjer, who was hired by Hopkins to look into the study's claims.

"So what these forced higher wages do is give the employers the incentive to hire the more capable workers and cut off the lower rungs of the employment ladder for those trying to get into employment," he said.

But this argument isn't bolstered by the hospital's low wages, said Kapsa.

"We think that the level of wages now are so low," he said, "that in fact it would be the opposite effect."

Hopkins, as an employer of 35 percent of the city's hospital service workforce, is key to the study since it is often the wage setter for Baltimore hospitals.

"A lot of other hospitals wait on the sidelines to see what Hopkins does," Kapsa said.

Compared to other health institutions throughout the state, Johns Hopkins Hospital ranks among the third lowest for compensation of service and maintenance employees, according to the study.

"That's demonstrably untrue," said Gary Stephenson, spokesperson of Hopkins Hospital. "We're the third highest paying hospital in the state."

Still, many Hopkins employees qualify for public assistance, according to the study, which it also called a "hidden government subsidy."

As a nonprofit institution, Hopkins qualifies for tax exemption and currently owns $505 million worth of tax-exempt property, while the city is facing a dwindling tax base, according to the study.

"Were these properties subject to taxation, Hopkins would have to pay $12 million a year in property taxes to the City," said the study.

But as a nonprofit, Hopkins would have to take away funding from other departments in order to support a hike in salaries.

"Hopkins has an obligation to its patients, to its donors, to the people it serves to do a good job," said Baetjer. "Hopkins isn't supposed to be an employment agency. It's a hospital."