Monday, November 13, 2006

Living Wage vs. Minimum Wage

Read the entire article at:
With all of the debate recently over raising the minimum wage, more needs to be said about requiring employers to pay a "living wage." In most cases $900 a month is not enough to support an individual ( in the US ) .

The Economic Policy Institute defines living wage as the "wage a full-time worker would need to earn to support a family above federal poverty line, ranging from 100% to 130% of the poverty measurement.

The wage rates specified by living wage ordinances range from a low of $6.25 in Milwaukee to a high of $12 in Santa Cruz."

Critics of a living wage requirement raise concerns about the negative impact increased labor costs would have on businesses and the economy.

Opponents argue that if labor costs too much, employers will stop hiring or become unprofitable.
A recent study conducted in Los Angeles found that the job loss was minimal for workers, contradicting claims by critics who suggest that "that living-wage laws lead to increased unemployment and business flight."  Living wage ordinance passed in 1997 and impacting 10,000 workers showed that job loss was minimal, and the benefits solid for the workers covered.

"Other studies conclude that there is no decline in the number of firms bidding for city contracts nor is the ability of a city to retain or attract employers paying decent wages limited by the implementation of a living-wage law."

Other shows that raising the minimum wage presents a number of problems.
First, there is a correlation between job loss among the most vulnerable employees, and wealthy teens displacing unskilled employees.

Second, while the lower class encounters more job losses, the benefited ones are the higher income families.

Additionally, it will hurt leisure and hospitality industries.

The Employment Policies Institute (EPI) found "16 percent increase in the unemployment rate and an alarming loss of 540 jobs following the mandate" as unintended consequences to the living wage regulation.

Current Efforts to Pass Living Wage Laws

Several cities around the US have recently tried to, or are currently trying to pass a living wage law. 


Advocacy Resources

Several organizations have provided information and resources for people interested in getting involved in living wage campaigns.


Care2 member Larry S. provided me with these other resources:

Thanks Larry.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.