A new Iowa law purports to allow 16 and 17-year-old kids to work in construction, roofing, manufacturing and other hazardous jobs. The new law is controversial for any number of reasons and not enforceable to the extent it contradicts federal legal prohibitions on child labor. On the other hand, business groups have been quick to talk about the virtues of young people getting real world work experience that may lead to jobs after high school. Another potential motivating rationale, though, has been left unsaid: when people get hurt working in hazardous jobs, it is cheaper if a kid gets injured.
A 17-year-old working a summer job was helping to pull a boom off a crane. A pin weighing approximately 100 lbs. held the boom on and when it was pulled out the pin came loose in an unexpected manner. The 100 lb. pin fell and was caught in the arms of the high school student causing him to bend backward. When the child laborer experienced back pain extending down his leg, an MRI revealed a lumbar disc protrusion. At his age, back surgery was not appropriate. Nonetheless, he was given years of injections, physical therapy and pain medications. Instead of playing football as a high school senior he has a 50 lb. weight restriction for life.
Contrasting The Numbers
So, what was the cost to the employer or insurance company? Based on the minuscule summer wages he was paid, workers’ compensation only had to pay $253 per week of cash payment to him. Without surgery, he was judged to have a 5% permanent impairment. Workers’ compensation only had to pay him about $6,300. With hospital bills, physical therapy, anesthesiology, pain medications and other medical costs, the total cost to the insurance company increased to approximately $29,000.
What happens if that 100 lb. pin lands in the arms of a 57-year-old technician? A low back injury to a 57-year-old worker likely leads to back surgery. A microdiscectomy, to remove part of a herniated disc, may cost between $15,000 and $50,000. Post surgery, this injured worker is likely to have restrictions more severe than simply a 50 lb. lifting restriction. He is likely to have permanent restrictions which are simply incompatible with his job description; that means he loses his job.
This type of injury could lead to a 15-20% impairment rating, restrictions ending his career in a physically demanding job and the loss of his current job. An experienced worker putting in more than 40 hours weekly could be owed $1000 in weekly workers’ compensation benefits, not $253. He receives at least $20,000 in temporary benefits from the insurance company while recovering from surgery. Once he recovers as much as he will recover, if this injury does not permanently and totally end his ability to work, but merely knocks him out of the type of work he has done for years, he is owed in the neighborhood of $300,000 in permanent benefits.
In sum, even if the surgery is the only expense our older worker needs that our younger worker does not, the difference in cost is stark. The same injury that costs the employer or insurance company $29,000 when it happens to a high school kid costs them $375,000 when it happens to a 57-year-old worker.
The Reality
In heavy duty, hazardous jobs people get hurt; that is unfortunately not changing. Given this fact, who would businesses rather get hurt? The more hazardous work which can be put on high school kids, the more work that can be put on the summer help, the risk of expensive workers’ compensation injuries for the employer goes down. Actuaries employed by insurance companies know this. Businesses know this. And while it sounds nice to talk about offering experience to young people which can lead to future opportunities, one reality which should not be lost is that it is simply cheaper for a business if a kid gets hurt rather than an experienced worker.
This was originally published on The Gazette and the September 2024 issue of The Prairie Progressive.