Let Justice Roll - Raise the State and Federal Minimum Wage

When fewer working families live in poverty, we all benefit

Today's Topic: 'Living wage' debate heats up
The Tennessean, 4/10/08

It is two words that inspire labor unions, rankle employers, and signify little to much of the rest of the public: a "living wage."

As the U.S. economy continues to weaken, and as the global economy undergoes a greater transformation, more and more people are likely to hear about it, and perhaps choose sides in the debate.

Nationwide, a loose coalition of advocacy groups is working to persuade employers to pay a "living wage" — usually defined as the hourly or annual wage a worker would have to earn to feed, transport, house, clothe and provide health care for a family of four, without government assistance. The amount would differ by locality because of differences in costs of goods and services.

Advocates cite the need for this based on a growing proportion of American families living in poverty despite the family breadwinners having jobs. For years, actual wages in the U.S. have declined or remained flat, adjusted for inflation, even as corporate profits and productivity have risen.

In Tennessee, the numbers are worse than for the nation at large. According to the most recent U.S. census figures, the percentage of Tennesseans living in poverty has risen from 13.6 percent in 1997 to 15.6 percent in 2005.

What would constitute a living wage in Tennessee? There is not a nonpartisan estimate, but the advocacy group Middle Tennessee Jobs with Justice's 2007 Nashville Living Wage Estimate states that a family of two working adults and two children should earn a gross minimum of $43,076 a year, or about $10.36 an hour for each adult. The estimate is drawn from government statistics including food and fuel costs and fair-market rent.

In 2007, nearly half of working Tennesseans earned less than that amount, according to Jobs With Justice.

Employers who oppose the living wage argue that, in a free-market economy, only the market should determine wages. If minimums are imposed, they say, they'll be forced to cut jobs. And, they add, workers who feel they should earn more should move to jobs in more lucrative fields.

Employers have valid points. Small startup businesses could have a tougher time if they had to pay a living wage, and there is always the risk of higher wages hurting businesses' ability to compete with foreign companies.

But living-wage advocates have equally valid concerns that have received less attention. Not only is more wealth in the U.S. shifting away into fewer hands because of corporate profit-taking, but the persistently lower wage levels cost all Americans more in the long run because more wage earners are forced to use government assistance to get by. And higher-paying jobs are not simply there for the taking, especially for breadwinners who cannot take time away from their low-paying jobs to train for better ones.

Living-wage requirements have taken root in some cities nationwide, thanks to the advocacy groups and labor unions. New York and Baltimore now pay workers a wage that is indexed to annually adjusted cost-of-living data. And in Nashville, Vanderbilt University late last year agreed to pay its 20,000 employees a minimum of $10.18 an hour, along with other concessions.

Sweeping, governmental wage reform appears unlikely anytime soon, especially in the current economy. The key instead is for these local negotiations to take place, and for employers and employees to keep an open mind and realistic expectations.

Everyone's ultimate goal should be to reduce poverty in America, which will elevate everyone's bottom line.

http://www.tennessean.com/apps/pbcs.dll/article?AID=/20080410/OPINION01/804100363