Living wages

The living wage debate has reared its head again in the wake of revelations that Wal-Mart is having a food drive for their own employees, and McDonald’s is telling employees to sell their stuff and apply for food stamps.  Most of the time these discussions center around retail and food service industries, and I keep seeing people just shrugging their shoulders and having a, “Well, what are you going to do?” attitude about it.

I think we have a tendency to look at these jobs as inherently “temporary” – something you do while you’re hellbent on getting a “better” job and a “career”.  And since it is temporary, there is no need for it to pay well, and if you are in one of these “temporary” jobs for any length of time, there is obviously something wrong with you.  Also, if these “temporary” jobs paid a decent wage, people would just get lazy and complacent and lose all their ambition.  (Because apparently being able to buy groceries without food stamps will just destroy all your ambition.)  It’s almost as if we are telling people, “It’s your own fault you picked this poorly paying job.  Go find a better one.  Until then, this is your punishment.”

But what about the people that aren’t hellbent on a career?  Or don’t have the education to just “go get a better job”?  (Maybe they want to, but it takes time and money.)  Or people who actually like the work that they’re doing?  Why would it be so horrible for people who are in these industries – regardless of whether it is a stop on the way to something else, or something more permanent – to be able to make a wage that they could survive on without their employer telling them to sell their stuff or apply for food stamps?  It isn’t going to destroy their work ethic.

I also keep hearing that if we raise wages for the lowest earners, the inevitable result will be rampant inflation and we’ll all be worse off.  I’m not buying this one.  (I did 15 years as a cost and revenue accountant.)  First, if you raise wages, you’re not raising total costs of whatever it is that you do.  Labor is only part of the equation.  Yes, your costs will go up, and your prices will go up (or profit down) but not to the extent that it will negate everything for everyone.  Getting employees to a point where they’re not needing food stamps or other assistance to survive doesn’t just benefit those employees.  Payroll tax receipts increase.  Drawing on public assistance decreases.  Income tax receipts increase (maybe not by much, but add it to less use of food stamps, etc, it’s a net positive.)  Because the employees have money they can spend, local sales benefit, and sales tax receipts increase.

We can do better for employees in the US.  So, why aren’t we?

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