A livable minimum wage
Published 2:03 pm Sunday, June 21, 2015
In recent years there has been a growing body of work — from economists, medical doctors, activists, and religious leaders — advocating for a livable minimum wage, but what exactly is that? A livable minimum wage, or a living wage, refers to the minimum hourly wages full-time workers would need in order to provide for the essential needs of themselves and their families without relying on federal aid. While the cost of living and worker productivity have consistently risen in the past four decades the minimum wage has remained basically stagnant. This means that the real value of the minimum wage, that is, the value that reflects the spending power of the minimum wage in today’s dollars, has decreased dramatically.
Why does this matter? According to a 2013 report by the North Carolina Justice Center the majority of North Carolinians who work in low-wage jobs are adults who depend on their income to provide for their families. Since the last time North Carolina’s minimum wage was raised in 2009 its real value has decreased almost 10 percent. In that same time period, 95 percent of the post-financial crisis growth in the United States benefited only the richest 1 percent of the country’s population while the poorest 90 percent of Americans actually became poorer. One way of bridging the dramatically increasing gap between the very rich and the working class is to demand a living wage for workers.
So how does one determine what a living wage should be? Dr. Amy K. Glasmeier and her associates at the Massachusetts Institute of Technology (MIT) have created an online calculator that determines how much a person or family needs to make in order to provide for themselves. The calculator uses a living wage model which goes beyond the federal poverty threshold, which they say only accounts for basic food needs. This model is based on a formula that takes into account the average prices of low cost food, housing, transportation, child care, health care and other basic needs from a particular area, as well as that areas tax laws.
This model is based on the absolute minimum needs of families so that they will not require assistance from federal aid programs. It assumes that low income families will choose the cheapest available options and it does not include any budgeting for expenses like eating in restaurants, entertainment, vacations and holidays, or saving for the future. For Beaufort County, according to the MIT calculator, a living wage for a single adult living alone would be about $10 an hour. For a single adult with a child it jumps up to about $20 an hour. In a family with two adults and two children a living wage would be about $22 an hour if one parent works and one stays home to watch the children, or about $14 dollars an hour if both parents work.
$15 an hour, indexed to grow with inflation, is a good, realistic demand that would provide much needed support for thousands of North Carolinians while helping many of them be independent of federal aid programs that cost tax payer dollars. It is time that many of the hardest working people in our state get the raise that they deserve so they can provide for their families.
Ryne Beddard received a BA in Religion from the University of Mount Olive and will begin his MA in Religious Studies at the University of Denver in the fall.