How can we decide what a minimally decent wage is? It is easy to see that $7.25, the federal minimum wage, is not decent. Even $10 an hour yields only $20,800 for year-round, full-time work. That's below the extra-low American poverty line for a family of four. Even for an individual living alone, it would not be enough in most cities around the United States. The $15 goal that many activists are working on and that California will reach in 2022, is much, much better. By an estimate made two years ago, 42% of American workers were earning less than $15 an hour, so movements that win a $15 minimum in states and cities are beginning to help millions and millions of workers.
But $15 is the least we should be aiming for over the long-range. It yields just a little more than $30,000 for a full-year of full-time work. And many low-wage workers do not work full-time.[1]
If we are debating with people who think $15 is terribly high, can we defend something higher $15? What would be an ideal minimum for our time. There are several ways to construct an ideal minimum wage, but two methods are particularly relevant. One is about minimum living standards and the other is about equality. As to the first, we can ask how much a family needs to live, not in affluence, but in modest comfort. Experts have estimated that a two-parent, two-child family requires about $54,500 a year for a modest living standard. (The amounts vary by where the family lives.) If there is only one earner, he or she must work full-time and earn $26 an hour.[2]
If we apply the equality method, we can say that people deserve to share in general increases in national income. One way to proceed here is to focus on per capita income--the total national income divided by the population. Per capita income increased 16 times between 1965 and 2015, but average hourly pay increased only half as much. One reason is that a tiny group of Acapitas@--the rich--seized much of the increase in the national income. If the hourly wage of the average rank-and-file worker had increased as much as per capita income, it would be $40 today, not $21. If the federal minimum wage of 1965 had increased by a factor of 16, it would be $20 an hour, not $7.25.[3]
In light of these facts, it is astonishing that many national politicians are happy with the pathetically low national minimum wage of $7.25. This indifference to the working poor occurs while big bankers and business tycoons take home massive compensation packages of millions and even billions of dollars.
I wonder what the President's working-class supporters expect of him on the wage front? He likes to visit factories and talk about jobs, but it tells us something about what he really thinks of the working class that the President, his appointees, and his friends are fine with a $7.25 national minimum wage and do not support the $15 movement.
Frank Stricker is emeritus professor of history and labor studies at California State University, Dominguez Hills, and he is a member of the National Jobs for All Coalition. He's finishing a book about the history and future of American unemployment.
[1]. 52 weeks of 40 hours = 2,080. Actual average weekly hours are usually just below 35. A review of much literature on the subject is Arne L. Kalleberg, Good Jobs, Bad Jobs: The Rise of Polarized and Precarious Employment Systems in the United States, 1970s to 2000s (NY: Russell Sage Foundation, 2011). Also Irene Tung, Yannet Lathrop, and Paul Sonn, "The Growing Movement for $15," National Employment Law Project, November, 2015.
[2]. James Lin and Jared Bernstein, AWhat We Need to Get By,@ EPI Briefing Paper #224, October. 29, 2008, www.epi.org. The budgets ranged from a high in New York City ($68,758) to a low in rural Mississippi ($35,733). The national average was $48,778, which, after inflation, is about $54,500 in 2017. See also Andrew Khouri, ALow-Wage Workers Can=t Afford Rent,@ Los Angeles Times, March 25, 2014, B2.
[3]. Annie Lowrey, ARaising the Minimum Wage Would Ease Income Gap but Carries Political Risks,@ New York Times, February 13, 2013, accessed at nytimes.com, 2/13/2013; Steve Lopez, AOverlooked and Underpaid,@ LAT, 5/22, 13, A2; Lydia Saad, AAmericans Say Family of Four Needs Nearly $60K to >Get By,=@ accessed at gallup.ocm/poll162587 on 5/22/2013; Don Lee and Shan Li, ARaising the Wage Floor,@ LAT, February 14, 2013, B1, B4. Per capita income is from the Bureau of Economic Analysis at united-states.reaproject.org/analysis/comparative-trends.
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