Dolan: Living wage, a cure for economic injustice

Mike Furno

With all this talk about war, I am beginning to sound like Bush. So, in order to stop this broken record, I’d like to change the tune to domestic issues, something our government has a hard time handling. Rather than all this talk about people dying in America, or people dying overseas, let’s take a look at making a living in the United States.

The living wage has been around since the original formation of the federal minimum wage, and has always been a hotly-contested labor subject. Should the government force businesses to pay workers a reasonable minimum salary or should they be allowed to let the labor market decide how much people make? The original thought behind the minimum wage was that a person’s paycheck could pay for his/her food, shelter, education and medical care. In the 1970s, the minimum wage was $3.65 an hour, which actually was enough at the time to provide a wage-earner with enough money to fulfiill his/her needs.

In 2002, the minimum wage stands at a solid $5.15 an hour, only a $1.50 more than the orignal wage 30 years earlier. Times have changed, rents have gone up, the cost of living is much more demanding, but our minimum wage has not adequately adjusted to such changes, and what has resulted is an exploitation of the lower wage workforce.

A living wage is a wage at which a person working 40 hours a week can afford basic housing.  The federal government through the US Department on Housing and Urban Development (HUD) has stated that no more than 30 percent of a person’s gross income should be spent on housing.  A living wage is designed to bring a person above the poverty line so that they can have money to spend on more than just housing and food. 

The current miminum wage rarely ever lives up to the government’s standard when applied to the housing costs all over the country. If we were to use only 30 percent of a minimum wage worker’s 40-hour-week base earnings for housing we would have to find a rent at around $240. According to HUD this amount is not enough for a local Fair Market Rent, the “amount that would be needed to pay the gross rent (shelter rent plus utilities) of privately owned, decent, safe and sanitary rental housing of a modest (non-luxury) nature with suitable amenities.”

The fair market rent average for an efficiency apartment in the Philadelphia metropolitan area, Bucks, Chester, Delaware, Montgomery and Philadelphia counties, is $553 a month according to HUD. Sure there are higher and lower priced apartments depending on the area in that huge region, but when the average four-wall room costs that much, one has to wonder if the standard wage should not also reflect the average cost of living.

Since the fair market rents vary from municipality to municipality, there is no set Living Wage like there is a minimum wage because it must vary to meet the needs of residents of different communities. A fair wage is one that is tailored to the locality providing enough for the worker to live. Can we really expect people in minimum wage jobs to spend 67 percent of their paychecks on just their housing? And we are just talking individuals here. What if the minimum wage earner is the breadwinner of the family? He/she cannot be expected to pay that much of his/her wage for rent and still be able to provide food, education, transportation, daycare and healthcare for their families. Such an assumption is absurd, yet we seem to live with this absurdity daily.

We come into contact with the minimum wage every day as we interact with grocery clerks, janitors, dish washers, receptionists and maids. Our lives are wrapped up in the lives of those that make so little, but we do not see the consequences of paying them less than what they need. Such effects are hidden at home, but we are still responsible. Welfare, tax breaks, and government subsidies are all simply treatments for the effects of economic injustice; the living wage is the cure.