Who Earns a Living Wage, and Who Doesn’t?

A living wage: the ability to make ends meet, to provide for necessities as well as to have some left over for savings and miscellaneous expenses. It sounds simple, but for a large number of workers across the country, it is far out of reach. For a staggering percentage of women and people of color, it is only an impossible dream

Today, the Alliance for a Just Society releases “Equity Out of Balance,” the latest installment in the Job Gap Economic Prosperity Series. The study shows that while nationally, and in 10 states and New York City, a significant percentage of all full-time workers fall short of earning enough to make ends meet, working women, workers of color, and non-citizen workers are especially less likely to earn enough for a single adult to support herself, let alone support a family.

This staggering disparity did not come about by chance; rather, a history of discriminatory policies laid the groundwork for the disparities that still exist today. When women were denied the right to vote or to keep their own earnings if they were married; Black slaves were sold as property and freed slaves kept in a system of slave-like conditions; Native Americans forced from their homeland to barren territory; and immigrants who were not free and white were prevented from becoming citizens, a system of economic racism and gender discrimination became entrenched in the nation’s culture.

Today, the results of such policies are shown in the over-representation of women and people of color in low-wage work. Women make up 60 percent of all workers in tipped occupations, and are 70 percent of all servers in the restaurant industry. In fact, across all industries, women make up 57 percent of all workers than earn at or below the minimum wage. Similarly, restaurants are the single largest employer of people of color, and the second largest employer of immigrants.

Increasing the minimum wage and abolishing the tipped minimum wage will disproportionately help women and people of color, but more targeted solutions can help advance pay equity. Equal opportunity statues and affirmative action should address these disparities and ensure that discrimination does not keep women and people of color at the bottom of the pay scale, but such statutes must be strengthened to ensure that they are actually effective. Additionally, unionizing sectors not covered by the National Labor Relations Act (like home care workers) and fast food and retail workers will help millions of workers across the country gain access to better pay, benefits, and worker protections, and will especially help the women and people of color working those jobs.

For over two hundred years, women and people of color have been subject to policies that keep them stuck at the bottom; it’s past time for that to change.

Fair Wages Aren’t Enough, Workers Need Hours, Predictability, too

Fast-Food-EmployeesThere’s no question that working families across the country are struggling to get by; wages for most income levels have been stagnant or declining over the past decade, while the cost of living has continued to increase.

One key to helping working families is increasing wages so that there are more living wage jobs available. However, increasing the minimum wage is only part of the solution for helping families whose low-wage jobs do not always include steady work.

Living wage calculations, like those produced by the Alliance for a Just Society, must make assumptions to remain consistent year after year. One of those assumptions is that workers have jobs where they can actually work 40 hours per week, year-round (for 2,080 hours per year). For many workers, this assumption doesn’t match their reality.

For retail and restaurant workers, a steady schedule with enough hours can be hard to come by. Retail salespersons and food preparation and service workers are two of the top five occupations with the greatest projected job growth between 2012 and 2022, but are also low-wage occupations, with 2013 median annual wage of $21,140 and $18,330, respectively. These jobs are also often shift work, without set schedules. Read more

Everyone Benefits When Workers Earn Living Wages

The South Korea government is taking an interesting approach to stagnating wages. The South Korean Ministry of Strategy and Finance is pushing a policy to offer tax credits to those firms that increase worker pay.

This legislation — which, if approved by the South Korean parliament, would go into effect in January — creates a policy incentive for firms to increase wages. As in America, wage growth in South Korea is “not keeping pace with corporate profits in South Korea, where household debt is rising while companies hoard cash,” according to this Bloomberg story.

Sound familiar?

Read more

LeeAnn Hall: Three Reasons Why Harris v. Quinn Matters to All of Us

This article was originally published in Huffington Post.

Screen shot 2014-06-30 at 5.50.01 PMThe Harris v. Quinn ruling on Monday was a huge step backward in the national effort to develop rights and protections for home care workers. It’s also a clear call to action for all of us not to become complacent or take for granted the rights and protections that were hard fought and hard earned by the labor movement.

In a 5-4 decision, the U.S. Supreme Court ruled that home care workers who do not wish to support the union that bargains on their behalf, can no longer be required to pay their “fair share” of the costs of collective bargaining with the state — even though they benefit from that bargaining process.

The attack on these public sector workers dramatically undermines decades of state-level progress in professionalizing the home care industry and ensuring that the people taking care of our nation’s grandparents and disabled people are paid decent wages, work in humane conditions, and can afford to take care of their own families.

This ruling is troubling for the home care workers it will affect — most of whom are women and people of color. Many make less than minimum wage. It is also troubling for all of us who understand that workers are more able to provide quality care when they are treated with dignity, paid fair wages, and have a voice on the job. Read more

Tools to Rescue Underwater Homeowners When Outreach Isn’t Enough

Photo by: Alan Pollock, Workers World

Photo by: Alan Pollock, Workers World

As previously discussed in Alliance reports, the housing crisis is over for some, but there are still millions of homeowners across the country struggling to pay off mortgages that are valued at more than the current worth of their homes. When combined with a sluggish labor market forcing many families to make due on less than before the recession, paying more than something is worth is not only dissatisfying, but often impossible.

In communities of color that still have high numbers of underwater mortgages, the effect on individuals overflows into the community, preventing entire neighborhoods from fully recovering from the recession.

During the height of the recession, there was sometimes a temptation to put the blame on borrowers who took out loans that they could not afford or with fine print they ignored, despite the fact that many homeowners were steered into these loans by banks looking to make a quick sale. Struggling homeowners were viewed as not smart with their finances and not reading or understanding the fine print, suggesting that it was the borrowers who needed to change.

As the crisis moved beyond subprime mortgages and property values dropped across the country, more and more “smart” people fell into foreclosure. Finally, the blame shifted appropriately to the banks, but solutions continued to focus on homeowners. Read more

Reversing the Trend: A Longitudinal Study of Living Wage and Minimum Wage

Screen shot 2014-05-28 at 11.03.10 AMA new report, “Reversing the Trend” by the Alliance for a Just Society, finds that Mayor Ed Murray’s minimum wage proposal reverses a minimum wage trend that is increasingly unable to meet the basic living needs of workers. Seattle’s proposed $15 minimum wage would be the highest in the country.

Analyzing more than a decade of data, this chart shows that while the path to a $15 an hour minimum wage is a step in the right direction toward addressing income inequality – living wage still exceeds projected minimum wage levels offered in the mayor’s model.

In addition, the study shows that a $15 minimum wage would not have been enough to support a single parent and child even back in 2003, and it would not have been enough to make ends meet for a single person as far back as 2010. Read more

Seeking Creative Ways to Help Underwater Homeowners

Chart by Haas Institute for a Fair and Inclusive Society

Chart by Haas Institute for a Fair and Inclusive Society

In 2007, the nation’s housing bubble burst, leading to the Great Recession of 2008 and a rapid drop in property values across the country. While the recession officially ended in 2009, more than 9 million homeowners across the country still have mortgages on homes that are now worth less than they owe.

These underwater mortgages not only leave homeowners strapped for cash as they struggle with the residual effects of the recession and slow job growth, but can depress the value of nearby properties when those homes are foreclosed on, and hamper communities’ ability to recover from the economic crisis.

In the Alliance’s 2013 Wasted Wealth report, detailed the devastating impacts of the foreclosure crisis in communities of color. As a recent report by the Haas Institute for a Fair and Inclusive Society similarly found, the communities of color have disproportionately high rates of underwater mortgages, compounding the existing wealth gap. Read more

Sallie Mae Slap on the Wrist Doesn’t Go Far Enough

This week the Department of Justice levied a $97 million fine against the student debt servicing giant Sallie Mae. The findings of the DOJ’s long investigation revealed a host of bad practices and illegal behaviors at the company, including overcharging on nearly all military service members’ loans, and mishandling borrowers’ payments to maximize late fees and penalties.

The fine is appropriate and offers some sense of justice, but it also feels eerily familiar to the lawsuits levied against the mortgage companies before, during, and after the Great Recession. Time and time again, the Department of Justice, state attorneys general, and regulators all found ample evidence of egregious wrongdoing and rampant fraud, resulting in several multi-million dollar settlements with all the mortgage giants.

Unfortunately, it ended there. There still hasn’t been a single executive of a major bank brought up on criminal charges and held accountable for the actions that caused the housing crisis. There were no structural changes in how the banks operate. These settlements simply became the cost of doing business – and we are still seeing the same reckless and illegal behavior years after they’ve supposedly taken their medicine.

The student loan debt crisis is the next bubble, no different than the mortgage collapse. Our future and our families are at risk. We have been here before –  this time, it’s not too late to stop it. Slapping Sallie Mae on the wrist isn’t the answer.

Sallie Mae is a folksy name for the giant SLM Corporation. Contrary to what many assume, Sallie Mae is a for-profit company, it services and collects on student loans. Most student loans are originated by the U.S. Department of Education, which is also making a big profit off of student loans – a reported $41.3 billion last year. If the Department of Education was a corporation it would be the third most profitable in the world, right behind Exxon Mobil and Apple.

The Department of Education has options. Sallie Mae’s contract is coming up soon to be renewed for the next five years. Violating federal law is grounds for termination. Sign our petition telling Secretary of Education Arne Duncan that Sallie’s Mae contract shouldn’t be renewed.

This is a clear example of the federal government having an opportunity to restore the faith of the country. It’s an opportunity to hold giant corporations accountable. If you break the law, even if you’re a giant financial institution, there will be repercussions that are more than just the cost of doing business.

Until corporate executives are put in jail or until lucrative federal contracts are pulled, financial industry giants will continue to consider federal law a mere suggestion.

Please sign our petition here.

Paid Sick Days: Good for Workers, Good for Business

Tony Sandkamp, owner of Sandkamp Woodworks in New Jersey, is a supporter of paid sick days for workers – because it makes sense for employees, and it makes sense for his company’s bottom line. Sandkamp, a Main Street Alliance leader, recently joined a panel of business leaders at the New York Regional Forum on Working Families, organized by the White House and the Department of Labor.

Part of the discussion focused on paid sick days. While many employees take it for granted that their employer will still pay them if they are forced to stay home sick a few days each year,many more workers are not given the option. If employees don’t come to work, they aren’t paid. Even scarier, if they miss work because of sickness, they risk losing their job.

“It’s ironic that I am advocating for paid sick leave, given that I think the last sick day I personally took was when I broke my leg in the third grade,” said Sandkamp. “When I worked for the airlines back in my twenties, I earned the ‘perfect attendance’ award for three consecutive years.

“But paid sick days just makes common sense – even for me and my small business,” said Sandkamp.

He has owned a custom woodworking business in Jersey City for more than 20 years. Sandkamp makes furniture and cabinets that are unique and one of kind – any mistakes can be very costly.

“A few years back, we were working on a cabinet, and the entire piece was coming from one tree, which required us to carefully match the grains of wood. It was very intricate work, and required a lot of concentration.

“One of my employees was cutting the veneers and cut them the wrong way. It was all the veneer we had left. He came into my office after he made the mistake. He had obviously been crying. He was a man who took great pride in his work,” said Sandkamp.

“What I didn’t know was that he had a fever. It was the flu season. But he came to work anyway, because he needed the pay. This man was the sole provider for his family. We started the cabinet over again, and lost a month’s work.

My business bottom line is not only about dollars – it’s about keeping my employees healthy and happy.

“For me, paid sick days is a non-issue since it will improve my employee retention,” said Sandkamp. “The cost of training that employee and replacing them is many times greater. I need people to work at their best every day. If they are sick and feel financial pressure to come into work, they are much more likely to make a mistake or potentially hurt themselves.”

The momentum is growing nationwide for economy-boosting policies like paid sick days. Laws requiring paid sick days have been passed in New York City, Newark, Jersey City, Portland, Washington, D.C., Seattle, and San Francisco. Small business owners across the country are getting involved at the local level to help craft and support laws that are good for small businesses, good for workers, and good for the local economy.

As we work together to build cabinets, paid sick days help build common ground, which makes my business stronger, and my employees’ lives better,” said Sandkamp.

Check out a video of the panel discussion here.