Friday, August 30, 2013

Can We Afford NOT to Raise the Minimum Wage?

What do you think about fast food workers' call for a $15 minimum wage?

The demands of the workers in fast food restaurants like McDonald's and Burger King say that it is impossible to provide for themselves or their families on today's minimum wage of $7.25 an hour.

"The nationwide day of demonstrations came after similar actions organized by unions and community groups over the past several months. Workers are calling for the right to unionize without interference from employers and for pay of $15 an hour. That's more than double the federal minimum wage of $7.25 an hour, or $15,000 a year for full-time employees..."

"...Jobs in low-wage industries have led the economic recovery. Advocates for a higher minimum wage say that makes it crucial that they pay enough for workers who support families."
"The restaurant industry says it already operates on thin margins and insists that sharply higher wages would lead to steeper prices for customers and fewer opportunities for job seekers."
"The drive for better pay comes as the White House, some members of Congress and economists seek to raise the federal minimum wage. But most proposals are for a more modest increase, with President Barack Obama suggesting $9 an hour."
"The Service Employees International Union, which represents more than 2 million workers in health care, janitorial and other industries, has been providing financial support and training for local organizers in the fast-food strikes around the country."
"Walkouts were also planned Thursday in Hartford, Conn., Los Angeles, Memphis, Tenn., Milwaukee, Seattle, St. Louis and other cities. Organizers said they expected thousands of workers and their allies to turn out, but the number of actual participants was unclear..."
That $15,000 a year figure is a startling figure, especially when you realize what it really takes to make it in a country still crawling out of the impact of the greatest recession in our history. 
According to an interactive data website by the Center for Public Policy Priorities, a family of four (two adults with two children), with no health care and no savings (usually the case for a number of service industry jobs), needs to make more than $60,000 a year, if they live in the Dallas-Plano-Irving area. That's two $15 an hour jobs...and the Texas economy is faring better than the rest of the country! 
But look at it another way. 
I graduated from high school in 1975. Shortly after I graduated, I worked at Jack-in-the-Box. Even then, I think I made more than the minimum wage. But here's a grocery store sales paper from that year, when the minimum wage was about $2.10...

Now, here's a sales paper from this week...

Of course the items aren't the same, but I think it's easy to say that there's a significant different in the pricing (like you needed to be told). So here's a thought: as insufficient as $7.25 is in today's economy, prices for commodities, goods and services rise with the increase in the minimum wage. Which means that they become affordable, because of the increase.  That is, if the rise in the minimum wage keeps pace with inflation...and it hasn't.

Take a look at this graph...

The real value of the minimum wage in 1975 in today's dollars was a little over $8.00. The value of today's minimum wage is barely worth $7.25. 
The question seems to not be whether we can afford to raise the minimum wage...and raise it higher than the President's proposed $9.00...the question is whether we can afford not to...

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