Three Cheers for Howard Schultz

According to Think Progress, Starbucks CEO has announced his support for an increased minimum wage.  Howard Schultz  does concede that some employers might cut back on hiring.  However, if corporate leaders like Schultz advocate for a higher minimum wage, it will break down the resistance.  This is a small big of good news on the wage front.

Three Cheers for Costco

Not all CEOs want to beat down wages.  Craig Jelinek of Costco declared that the minimum wages should be $10.10 an hour.  His company has a history of paying its workers fairly, unlike its primary competitor, Sam’s Club (Walmart).  Costco’s starting wage is $11.50 per hour.

I think it’s great that an executive of a leading company has joined this debate.  However, people need to vote – with their feet.  If Costco supports working people, they need to repay that support and stop shopping at places that do not pay decent wages or treat works poorly.  Consumers can change corporate behaviors if they stop spending their money at companies that want to take more and more from employees.  A good way to start would be to shop at Costco.

Women and the Minimum Wage

Think Progress offers some of the most interesting, thoughtful journalism on the Internet.  Today, Annie Rose Strasser looks at how the minimum wage affects women.  I was shocked to learn the 2/3 of minimum wage earners are women.  If the minimum wage were to be raised (as I said yesterday, don’t hold your breath), over 17 million women would benefit.  These figures are shameful, but it won’t move those politicians who only care about the feelings of the super rich.  They have no shame.

Raising the Minimum Wage and False Hopes

In his State of the Union speech, President Obama proposed a $9 minimum wage and that the minimum wage should be pegged to inflation.  It’s great that he made this statement, but, given the GOP domination of the House, this proposal is nothing more than an act of wishful rhetoric.

It also doesn’t address the bigger problem:  stagnant wages and wage cuts.  One of my clients has spent 20 years in the insurance industry.  Over the last seven years, her commission has been cut from 15% to 10%.  If she doesn’t hit a target, it can go as low as 8%.  The company she works for is very profitable (You know, one of those major corporations that pays little to know federal taxes).  The industry is also profitable.  So why the salary cuts?  More money needs to be pushed to the top.

I think the minimum wage does need to be raised.  I also believe that the government needs to do more to spur job growth.  However, as long as workers are getting squeezed in what they are paid and not paid (benefits), the bigger problem will be a shrinking middle class and a larger class – the working poor.  Few politicians talk about that problem, and it will impact all of us very soon.

Supporting Those Who Serve Us

I received a petition request from MoveOn that should be considered for its content, even if you decide not to support.  Workers in the service industry really work in harsh conditions.  They survive by tips.  And they are often go unpaid when restaurants fail.  Here is the letter – judge for yourself.

Dear MoveOn member,

You probably know that when you order a meal in restaurant, the person who brings you the food is generally paid less than minimum wage. Tips are supposed to make up the difference.

Here’s the problem: Minimum wage for tipped employees is an appalling $2.13 an hour. And for millions of people who work in the restaurant industry, tips don’t come close to providing a living wage.

This is not a small problem. Almost one-third of food workers don’t have enough money to buy enough safe and nutritious food to meet their needs. The people who make and serve your food literally may be going hungry.

Next week, we’ll be at a press conference in Washington, D.C. with key members of Congress, launching a big push to raise the minimum wage for food workers and restaurant employees.

To win this campaign, it’s critical that we be able to walk on stage with momentum—that means tens of thousands of folks like you standing with us.

Sign the petition: Tell Congress to give food workers and restaurant employees a fair minimum wage.

We can do this, but not without grassroots support. That’s why I created a petition on SignOn.org to Congress, which says:

Raising the minimum wage for the benefit of 29 million low-wage workers would increase food costs at most by 10 cents a day for consumers.

As a consumer, I am willing to pay an extra dime a day for my food so that close to eight million food system workers and 21 million additional low-wage workers can receive a much-deserved raise to help them meet their basic needs.

I ask that you support the Miller-Harkin Fair Minimum Wage Act, which would raise the federal minimum wage from $7.25 to $9.80/hour over the next 3 years and the tipped minimum wage from $2.13 to 70% of the regular minimum wage.

Click here to add your name to this petition, and then pass it along to your friends.

Thanks!

–Saru Jayaraman

Could You Make It on Less Than $10 an Hour?

According to an article by Travis Waldron of Think Progress, 25% of the hourly workers in the U.S. have to make do with wages that are less than $10 per hour.  Waldron documents that this kind of job is increasing.  Many of these workers are employed by very profitable corporations.

Clients always ask me about unemployment, which I admit is a problem.  However, wage stagnation and decline is a much bigger problem.  Today I met a client who works in healthcare as a medical assistant.  He has three certifications.  A year ago he was working a 40 hour week and only making $14 an hour (about $28,000 a year, not much in Chicago).  Last week he learned that his company had fallen on hard times, his hours have been cut to 28 a week and his pay cut to $12 an hour.  Hourly employees have been given no indication that the company’s owners or managers have made a similar sacrifice.  Is this the America that some call exceptional?  I’d call it embarrassing.

Making Less Than the Minimum Wage

I frequently praise Laura Clawson of Daily Kos for her coverage of issues that affect working people.  Today her story made me want to scream.  The problem is not Clawson’s reporting; it’s the subject matter:  Home health care workers can be paid less than minimum wage.

This is disgusting.  Clawson says that President Obama is trying to address this issue.  My question is: How could it happen?  The rationale for paying less than minimum wage is that being a home health care worker is similar to being a babysitter (Huh?).  Home care workers cook and bath their elderly clients.  They have to be aware of any potentially medical issues.  They have to be trusted to enter homes.  This is not the work of a 14 year old babysitter.

According to Clawson, there are 1.8 million home care workers.  My guess is that some of them – maybe even a majority – make more than minimum wage.  But it’s outrageous to think that even one person doing this important job could be paid as if she were a babysitter.  This story is outrageous.  The problem is that too many Americans seem only to have outrage at the poor, not at their exploitation.

Minimum Wages below 1968 Levels

Writing in today’s Common Dreams, Ralph Nader discusses how progressive congressmen have proposed raising the minimum wage to $10 per hour.  The current rate is $7.25, which would work out to less than $15,000 for a full year’s work at 40 hours a week.

According to Nader, the minimum wage is worth less now than it was in 1968.  Most Americans (70%) support raising the minimum wage.  Nader also notes that since the money would be going to people who would spend it, a raise in the minimum wage would also boost the economy.

Of course, this great idea is pure theater.  Republicans control the House, and they will never let the Progressives’ bill go forward.  That said, it’s important that people like the congressman and Nader keep fighting.  Every time we hear the words “deficit” and “cut,” we need to ask:  Who wins this game.  It’s not the 99%.

Thinking About the Poor

Barbara Ehrenreich published Nickel and Dimed, a book about the working poor, in 2001.  Ten years later, she is revisiting this topic and has found that those who had the least now have even less.  There are fewer jobs for blue collar workers, and unlike the middle class, the working poor seldom have any savings.  People are buying food that is out of date and renting to other unfortunates who pay to sleep on a couch.  Is this what makes America exceptional?

Safety programs often don’t help either.  Welfare programs have been cut.  Worse still, Ehrenreich shows how poor people on the street are more likely to be treated as criminals for “crimes” like jaywalking or begging.  She frames the new reality in these scalding words: “The safety net, or what remains of it, has been transformed into a dragnet.”   I can’t help but wonder how many of these people go into a prison where they work for private companies at wages lower than what is paid in China.

I urge you to read Ehrenreich’s article and – if you have not done so already – her classic Nickel and Dimed.

Wage Winners and Losers

In today’s Common Dreams, Holly Sklar tells a story we’ve heard before, but can’t hear often enough:  Workers are getting screwed.  Sklar writes:  “CEOs make more in a few hours than minimum wage workers who care for children, the ill and the elderly make in a year. Median CEO pay was $10.8 million last year among 200 big companies measured by Equilar.”  The next time someone condemns the phrase “class warfare,” tell that person that the war is on and the top 2% are winning.

Sklar advocates raising the minimum wage.  While I think that idea, like tax increases on the super rich, is good, will it real solve the bigger problem:  insatiable greed?  People like the Koch brothers believe they live in a world apart.  They don’t care about their fellow citizens.  They don’t care about the poor.  They care only about themselves.  Sadly, they have about 30% of this country bamboozled into following their ideas. 

Working people – those that do not live off of investments or inheritance – need to wake up.