Publisher's Note
The Wage Name Game
Remember when life was so simple, and every once in a while the same old tired debate over the minimum wage emerged?
The same old arguments are trotted out. Labor likes it because it raises the floor. Business doesn’t like it because it raises the cost of doing business. Common sense—and statistics— shows a higher minimum wage prices poor people out of the job market. Some jobs aren’t worth a higher price to do (remember when you didn’t have to fill your own drink at a fast food restaurant?) and some become more vulnerable to automation.
We hear about the poor single mothers raising their children on a minimum wage. Figures show they’re a miniscule portion of minimum-wage earners. The more accurate picture is the teenager entering the job market for the first time, living comfortably at home, thank you.
And back and forth it goes. Finally, a “compromise” is reached and the minimum wage is increased. The economy adapts, and fewer entry-level jobs are available. But things have gotten complicated—we now have the “living” wage. Same tired principle, just with a more humanitarian name. Our elusive single mother is more prominent in the arguments, becoming the skirt those with agendas hide behind.
The battles around the country over the living wage have been intense. Government officials have been called everything short of child starvers. It’s hard to imagine an uglier situation than the one down the road in Bloomington. The living wage group has targeted the new coliseum. They’ve contacted performers scheduled to appear; they’ve invoked the Freedom of Information Act to obtain council member e-mails—and one of the group leaders is a councilman.
And now, before we’re even comfortable with the new semantic shift, the “big-box” wage comes into play. Chicago’s city council was first in the nation to try passing a minimum-wage ordinance. Mayor Daley vetoed the first action, which passed on a 35–14 vote, and the council later failed to overturn the veto. If a company with $1 billion or more in annual sales wanted to open a store with 90,000 square feet or more, it had to pay its employees this big-box wage. That would be $9.25 an hour, with $1.50 an hour in benefits. By 2010, those figures would be $10 and $3, respectively. Not enough? How about automatic annual cost-of-living increases?
The mayor argued that residents are heading to the suburbs to shop, denying the city sales tax revenue—and, of course, jobs. Many of those jobs would go to the more than a handful of poor urban youth in the city and—oh, yes—to the single mom. Target and Wal-Mart will certainly bail to the burbs, creating new opportunities for the teenagers and single moms there.
The name is irrelevant. Minimum, Living, Big-Box…it’s all lipstick on a pig. What’s relevant is the following:
• A “you-name-it” wage just guarantees those who already have the jobs will make more—and they’ll have fewer coworkers.
• It’s not the responsibility of business to make sure the single mom is getting by. That’s a role government already fulfills with its multitude of programs to help her.
Maybe the problem is that the wrong side has taken the upper hand in the naming battle. I’d suggest three new names:
• The “Skill Wage”—to address that the real problem isn’t a shortage of jobs, it’s a shortage of workers with the proper skills and of workers who even attempt to obtain those skills.
• The “Work Ethic Wage”—to allow an employer to hire people at a lower wage, then reward them for their performance, including the ability to make it to work Mondays and Fridays.
• The “Driver’s License Wage”—to give an employer the guarantee that the “can’t find a ride” excuse won’t catch the business shorthanded at the wrong time. IBI
The same old arguments are trotted out. Labor likes it because it raises the floor. Business doesn’t like it because it raises the cost of doing business. Common sense—and statistics— shows a higher minimum wage prices poor people out of the job market. Some jobs aren’t worth a higher price to do (remember when you didn’t have to fill your own drink at a fast food restaurant?) and some become more vulnerable to automation.
We hear about the poor single mothers raising their children on a minimum wage. Figures show they’re a miniscule portion of minimum-wage earners. The more accurate picture is the teenager entering the job market for the first time, living comfortably at home, thank you.
And back and forth it goes. Finally, a “compromise” is reached and the minimum wage is increased. The economy adapts, and fewer entry-level jobs are available. But things have gotten complicated—we now have the “living” wage. Same tired principle, just with a more humanitarian name. Our elusive single mother is more prominent in the arguments, becoming the skirt those with agendas hide behind.
The battles around the country over the living wage have been intense. Government officials have been called everything short of child starvers. It’s hard to imagine an uglier situation than the one down the road in Bloomington. The living wage group has targeted the new coliseum. They’ve contacted performers scheduled to appear; they’ve invoked the Freedom of Information Act to obtain council member e-mails—and one of the group leaders is a councilman.
And now, before we’re even comfortable with the new semantic shift, the “big-box” wage comes into play. Chicago’s city council was first in the nation to try passing a minimum-wage ordinance. Mayor Daley vetoed the first action, which passed on a 35–14 vote, and the council later failed to overturn the veto. If a company with $1 billion or more in annual sales wanted to open a store with 90,000 square feet or more, it had to pay its employees this big-box wage. That would be $9.25 an hour, with $1.50 an hour in benefits. By 2010, those figures would be $10 and $3, respectively. Not enough? How about automatic annual cost-of-living increases?
The mayor argued that residents are heading to the suburbs to shop, denying the city sales tax revenue—and, of course, jobs. Many of those jobs would go to the more than a handful of poor urban youth in the city and—oh, yes—to the single mom. Target and Wal-Mart will certainly bail to the burbs, creating new opportunities for the teenagers and single moms there.
The name is irrelevant. Minimum, Living, Big-Box…it’s all lipstick on a pig. What’s relevant is the following:
• A “you-name-it” wage just guarantees those who already have the jobs will make more—and they’ll have fewer coworkers.
• It’s not the responsibility of business to make sure the single mom is getting by. That’s a role government already fulfills with its multitude of programs to help her.
Maybe the problem is that the wrong side has taken the upper hand in the naming battle. I’d suggest three new names:
• The “Skill Wage”—to address that the real problem isn’t a shortage of jobs, it’s a shortage of workers with the proper skills and of workers who even attempt to obtain those skills.
• The “Work Ethic Wage”—to allow an employer to hire people at a lower wage, then reward them for their performance, including the ability to make it to work Mondays and Fridays.
• The “Driver’s License Wage”—to give an employer the guarantee that the “can’t find a ride” excuse won’t catch the business shorthanded at the wrong time. IBI
