Real wages for real people
Pawlenty's house economist, Tom Stinson, is doling out some phony magician-talk with his curious wage projections for 2005. As far as I can tell, he is predicting a whopping 2 percent wage growth, yet he's using a "broader measure of real personal income the total income of all Minnesotans from all sources -- in his forecast." Does this mean he's including sales of used CD's and blood plasma too? Or could it be he's factoring in the rich-get-richer elements of securities and mutual funds and tax breaks, which have nothing to do with wages? I don't believe him, and I bet his meager 2-percent wage prediction will be cited and stonewalled during negotiations with Minnesota's long-suffering public workers in the coming year. A basic living wage, for many public workers, will mean at least a 5% increase next year.
For a more realistic analysis, see Barbara Rose's excellent writeup, Real Wages Keep Falling, which paints a darker picture, and quotes an inside source which has no interest in duping the public or the policymakers:
Naturally, not many human resources managers are trumpeting their commitment to holding the line. But in a recent issue of Workforce Management, a leading trade journal for human resources executives, the latest advice is plenty blunt.
"Annual pay increases designed for optimal hiring and retention are no longer needed," the magazine declares.
"If your salary increase budget for 2005 is much higher than 3 percent, you're probably overspending," the article advised.
Wait, what about productivity and profit margins?
Really, this supposedly recovering Bush economy feels like brewing a Hummer coffee pot as the tires spin deeper into the mud. 
Support unions in your neighborhood and your workplace, and let's fight for a living wage in the coming year.
posted by Mark D. @ 1:47 AM |
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3 Comments:
Coming from an employer, phrases like "broader measure of real personal income" tend to mean that they are going to include your benefits as part of their measurement of your income. Coming from the state, who knows?
I think anyone who knows a self-supporting public worker (or a family supported only on public-worker wages) will know what I mean about "long suffering". Most can't make ends meet, too many have been laid off in the past 5 years, and all of them are disdained by a curiously popular (Taxpayers League) ideology that says public workers are unnecessary burdens on the lifestyles of suburban homeowners.
I should also mention, on the long-suffering front, the bad-faith behavior of the MN state legislature, which two years ago refused to ratify a contract bargained in good faith, because a handful of ice fossils objected to a domestic-partner benefit which would have cost the state almost nothing.
As for a living wage, the Jobs Now Coalition has an excellent Living Wage Calculator specific to Minnesota, which works pretty well. According to the results, I'm making $1.66/hour below the living wage for my own situation, which seems about right...
I agree with you that 50K ain't a salary to evoke much sympathy from a poor bloke like me, but it is interesting that 50K is no longer sufficient to support the American dream (sending your kids to college). In fact the NASA chief resigned for the very same reason last month...
A couple things, Decaf:
1) The reason why the cost of living for a household with 2 adults/2 workers is higher than for a household with 2 adults/1 worker is almost entirely due to the increased transportation costs of having one additional worker who needs to commute to work everyday. The remainder of the increase is due to the increased income taxes. In my book, that all makes perfect sense and isn't "odd" at all.
2) As for in-state tuition: check out this chart of averages by state. Some (like California's $451/yr) are exceedingly manageable, even for a single mother of two making $35k. Others, such as MN's $2805/yr, are much higher and would take a huge bite out of the $35k budget. Sure, some college kids are self-sustaining, but I'm sure there are plenty of parents out there who would tell you that the financial cord isn't cut once the kid's living in a dorm.
3) No living wage campaign is based on the premise that individuals with different homelives should be paid according to how they choose to construct their families. No one is objecting to the notion that pay should be based on performance. I'm a single woman without kids and I would consider it discrimination if a married woman with kids in my position were paid more - in WAGES. I would have absolutely no problem accepting that she would most likely have a better benefits package due to more healthcare coverage or use of the company's (paid or unpaid) maternity leave.
What living wage proponents ARE saying is that current average levels of wages in many sectors - or for certain job levels within a sector - do not adequately allow people to meet their costs of living and are, in fact, poverty-level wages.
From the Economic Policy Institute's Living Wage FAQs:
"The main reason for enacting a living wage ordinance is to reverse the downward trend in wages for low-wage earners. Wages for the lowest-paid 10% of workers fell 9.3% between 1979 and 1999. The number of jobs in which wages were below what a worker would need to support a family of four above the poverty line also grew between 1979 and 1999. In 1999, 26.8% of the workforce earned poverty-level wages, an increase from 23.7% in 1979.
Living wage ordinances are necessary to prevent city and county governments from encouraging the creation of jobs that pay wages so low that workers live in poverty. Without living wage laws, governments could contribute to the creation of poverty-level jobs by hiring low-paying sub-contractors or giving businesses tax breaks or subsidies to create jobs without any guarantee that the new jobs will pay a decent wage."
While EPI focuses on living wage ordinances that only apply to government contracting, their argument for city-wide living wages is clear and convincing.
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