Posted by Charity on March 29th, 2006

Today, I am going to pick on livable wages. If you have never heard this term, you can school yourself here. I am going to jump right in with the assumption that my readers have a base knowledge about livable wages.

Here is what I never understood about the whole concept: the actual wage figure is dependent upon one’s family situation. The average livable wage for a single person is $12.79, but the livable wage for working parent of two children, with the other parent not working, is $22.53. How can we base wages on family make up?

So, does that mean that if a guy marries a woman with two kids and they decide that she will stay at home, then he should get a $10 raise? That is the part that never made sense to me. Does an employer have to pay for an employee’s lifestyle choices? I don’t get that.

I also question their figures. According to the figures, my household does not earn a livable wage, yet we have all of our basic needs met and still manage charitable giving. We pinch pennies, but we are able to live on this wage. I am not saying they should base the calculations on my personal lifestyle. What I am saying is that there is such a wide variety of choices people make that to name a livable wage figure is completely arbitrary. (You can look at the breakdown of how they figure the needs here. Look under Livable Income/Basic Needs.)

How much money we make and spend all boils down to personal choices. For example, my husband and I decided that for now he should stay at his job (making an un-livable wage) because the hours are predictable and he gets a lot of vacation days. We made a personal choice that puts family time before money. He knows others who have left his company for a higher wage, but are now putting in more hours and even traveling. That arrangement does not suit our family.

Work schedule is an intangible factor that is not considered by the need calculation. I once worked at a job that paid lower than I would have liked because the hours were 9-5 with an hour lunch, but we got paid for an 8 hour work day. At the time I was a single mom and I needed the later starting time to make daycare drop-off easier. I also liked having the hour for lunch to run errands. I could not place a dollar amount on those benefits.

Contrary to the premise behind the livable wage figures, a person’s family situation should not determine their wage. An employer determines how much money the position is worth and what other benefits it will include. It is our choice whether or not to take the job.

Let’s say that you are forced to take a job or go hungry – as is often the argument made. In that case, you still have control over how you spend your money. You can choose not to spend the amounts of money that are allocated in each area used to figure the livable wage. For example, it says that a two parent household with one wage earner and two kids spends $592/month on transportation. Well, if you choose to take a lower-wage job, you could also choose to spend less on transportation. Or you could choose to spend less than $785/month on food or less than $270/month on personal expenses (that figure is excluding clothing). If you make changes to your own budget, your non-livable wage could work fine for you.

Another good point was made by Jeremy Ryan when running for City Council. The VT Livable Wage Campaign asked the candidates two questions. Part of his response said, “I also believe in the right to work. If someone wants to work and is lacking in skills, but willing to learn and work at a lower wage, we should allow them the opportunity. I dislike mandatory policy that would exclude people from serving our community.”

My point is that employers and employees should have the freedom to determine the situation that works best for them. The government should not force this issue. It not only takes away the employers’ rights to make their own business decisions, but it also takes away the workers’ rights to find jobs that suits their personal needs.

12 Responses to “Livable wages”

  1. Do you believe in a minimum wage?

  2. The VT Livable Wage Campaign claims, “When originally passed as part of the Fair Labor Standards Act in 1937, the minimum wage was supposed to be enough for one working parent to support a family of four.”

    I do not support a government mandated wage at that level.

    I don’t think the government should impose a minimum wage at all, really. I don’t see the need for it. There is a certain level below which people will not work. Even jobs like McDonald’s now pay above the minimum wage to stay competitive.

    Employers and employees should have the right to work out other arrangements, if they need to.

    What if a kid wanted to work a summer job at a corner store, but the store owner couldn’t afford extra help. Shouldn’t the kid have the right to negotiate a lower wage in exchange for the much needed job experience?

  3. Do you believe in labor laws and safety standards?

  4. “Do you believe in labor laws and safety standards?”

    Do you believe in staying on topic?

  5. “Do you believe in labor laws and safety standards?”

    It depends on which laws you are specifically referring to.

    I think it should be illegal for anyone to endanger the health and safety of another person. That is a violation of their basic rights. Should the government protect us from that? Yes.

  6. I agree with your piece, Charity. The more decisions the government makes for the people, the less accountable the people have to be for themselves and their actions.

    When the government takes control of people’s welfare, it discourages personal responsibility. Just look at France right now (just one of many examples).

    As somebody who has never worked for anything but minimum wage, I won’t deny that it was miserable. But it forced me to take responsibility for myself and my life, attend community college and ultimately the fine institution I attend now (ha). My point is, if I had a guaranteed livable income, I don’t know that I would have taken the initiative to “broaden my horizons.” Not that living on Ramen noodle soup and fishing in my sofa for nickels wasn’t great and all.

  7. “Do you believe in labor laws and safety standards?”

    Do you believe in staying on topic?

  8. This week’s New Yorker arrived in the mail yesterday. They touched on how poverty is calculated in a lengthy article: Relatively Deprived

    “…poverty thresholds are based on pre-tax income, which means that they don’t take into account tax payments and income from anti-poverty programs, such as food stamps, housing subsidies, the Earned Income Tax Credit, and Medicaid, which cost taxpayers hundreds of billions of dollars a year.”

    Personally, I’d like the livable wage to mirror that set nationally or the rate set by the Federal government and then continue to use other programs to assist the working poor. If it is a choice between a greater number of individuals employed at $X wage as opposed to a lesser number of individuals employed at $X+ wage, I want to see more people employed.

    I write as someone who expects to be bagging groceries at the Chopper in her retirement years. If employers are forced to pay $X+ wages, jobs may cease to exist as employers move to streamline costs by automating more jobs. And, if individuals are comfortable at $X+ wages, then there is less turnover and less opportunity for those who need the first (or last) entry in the job market.

  9. Thanks for your comments. I’ll have to check that article out.

  10. NPR has a story about paying illegal immigrants $10/hr in a fish processing plant. They can’t find legal workers to work for $9.95/hr. These immigrants come from other countries to find these jobs to send money home. I’m not sure how they can live here, work at jobs no Americans will do, and still send money home. I’d love to have more people with that work ethic and frugality in America.

    If you want to push for a livable wage, then we can increase wages by 100% by letting workers keep 100% of their income. Currently much of your income goes to direct and indirect taxes. $10,000 of the price of a $22,000 Ford Taurus is hidden taxes and regulations. Imagine how much better we’d be if we’d reduce the size of government (for the liberals this might mean reducing military spending to just defense).

    So before people jump on the inflationary and job destroying minimum/livable wage campaigns, we need to reduce the 4.5 billion dollar state budget and the federal budget of $2.8 trillion dollars.

    Hardy

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  12. You know traditonalist Catholics have advocated something like a living wage for years…it is called a family wage and the wages are based on what it would take for a working father to support a stay-at-home wife and their children. It is a form of paternalism.