Minimum wage = living wage

I wish I got raises in this %

Published on August 3, 2007 By KarmaGirl In Current Events

Being that I manage HR where I work, I get to see all the "news" about minimum wages (both in the state and federal). Our State's minimum wage has always freaked me out at how high it has gotten, but the current changes in FEDERAL minimum wage has me down right fearful.

Why? Because it is now becoming a living wage. Either companies will quit hiring non-skilled workers (where will they work?) or they will start using their non-us factories more.

If you don't know the amounts, don't worry, I'm about to give you the stats.

In 1997, the Federal (don't confuse this with your States, which you may not even have, or it may be higher) the minimum wage was set at $5.15. As of July 24th of this year, it was raised to $5.85. No big deal- that's only a bit over 13% over the course of 10 year. Now, this is where I start to worry- the *second* step will raise the minimum wage to $6.55 on July 24, 2008 (12% over ONE year) and the Third step will raise the minimum wage to $7.25 on July 24, 2009 (10% more).

Now, I don't know about you, but I doubt that I will see raises like that during that time. However, you can bet that cost of living will rise since it will cost business more to employ unskilled workers.

I always looked at minimum wage as the wage that you paid people that were doing completely unskilled jobs (bagging groceries, stocking shelves, collecting carts, making photocopies, packing boxes, etc.) ~$5.50 an hour seems like a good pay for that type of labor. But $7.25???? That's not minimum, that is "living".

When I started the job that I have now, I started out answering phones, taking orders, doing data entry, shipping orders and managing the office. I made $7.00 an hour, and I had a lot of responsibility.

What is $7.00 per hour, anyway? It is $14,560 per year. After tax, that is $11,503, which is $958 per month. Can you live on it? You bet....

This is what my living cost me back then (1995) per month:
apartment: $410
car payment: $120
Insurances: $110 (car and renters)
food: $175
phone: $30
Gas: $40
Misc.: $25
Total: $910 - $48 to spare- that's what I got for being over minimum wage!

Yep, it was tight, but it covered my NEEDS (something that a lot of Americans seem to have a hard time separating from "wants").

So, what about $7.25 an hour 12 years later?
That's $15,080 per year. After taxes: $11,914 (per month: $993)
Same Apartment: $470 (checked on their rates to have the actual number)
car payment: $120
Insurances: $115 (car and renters)
food: $175
phone: $30 (except now it would be mobile!)
Gas: $55
Misc.: $25
Total: $990 - only $3.00 left over- but needs are still paid for...no skills required.

Now, before somebody says "but,that can only support one person!" I shall say- it's meant to. If you have a couple- both of you will have to work, and will be better off (rent won't be higher, as an example). Have a kid? Alternate shifts. Sure, it isn't ideal, but it will pay the bills.

So, we no longer have a real minimum wage- we actually have a living wage. One that many will find "good enough" and never strive to do better. Does this help our country in any way? I don't think so. I think it will hurt it in many ways, especially if this trend continues.

Comments (Page 2)

Trudygolightly

on Aug 03, 2007

Insurance sure is cheap where you live!

I live in MN and was only paying $33.0 a month for the minimum coverage, this was only 4 years ago too. I haven't had renters insurance, like Karma did, so don't know what that goes for

Also the rent tends to be cheaper the more isolated the area one lives in, at least this is true where I live. In WI there's some really cheap rents around, I know because I've been checking them out as I"m homesick.

Back in 93 I paid $212.00 a month for a trailor and $145.00 for lot rent. Apts. back then, in my small town, went for $350-$475.00.

Around here one can get car payments for about $125.00 a month from small town car dealers, and I'm talking about a car that's around a 93 or so, and about 150,000 miles on it. However they're in pretty good condition and you can talk to the previous owner.

Ziggystyles

on Aug 03, 2007

I think you are right...but that it depends on where you live. For example...Minimum wage out here is 5.15 an hour.
thats about 800 a month or $10,712 a year, before taxes. Considering the poverty level is 20k, Id have to have at least two jobs if I wanted to break that line. Also...the costs of housing can play a big factor. Marcie called around for some numbers yesterday on rentals. One place wanted about 3k in deposits alone...which on a minimum wage job would be about 3 months work. Also, because of the location, the cost of living is rather high over here too. Groceries aren't even funny.

foreverserenity

on Aug 03, 2007

I do agree that it depends on where you live. In some cities, rentals are much higher. And most times these days, there are many families with single parents, many of them not living on welfare, I know a couple of them.

There are also those families with two parents working and they don't make ends meet because the cost of living is higher and has gone up even higher these days. Some families work two to three jobs in order to have luxuries, i.e, the extra cell, the cable, etc., while some, to just make it for the basics. There are also many workers who do not have health insurance because that is more expensive to the employer (if they don't care enough to provide that luxury)! But thank heavens for the ones out there who do provide it!

JeremyG

on Aug 03, 2007

People have mentioned welfare a couple of time....it strikes me that maybe if the minimum wage, was competitive with welfare, people would be more likely to work

ParaTed2k

on Aug 03, 2007

The great lie is that there is a high percentage of people trying to raise a family on minimum wage. Just like the "20 million Americans without access to healthcare" lie, it is based on inflated numbers and equally inflated emotions.

My question to the reletive few who are trying to raise a family on minimum wage... What are YOU doing to make it so you aren't still making minimum wage in a few years? If you aren't doing anything to change that, why should your employer or the government?

Gideon MacLeish

on Aug 03, 2007

Just like the "20 million Americans without access to healthcare" lie, it is based on inflated numbers and equally inflated emotions.

No, according to Mikey Moore, it's 54 million!

SanChonino

on Aug 03, 2007

If you managed to find a reliable car for $10,000

My car, which as had one problem with it since I purchased it almost three years ago (a dead battery - typical for the age of the car) was six thousand bucks. Was it new? Not quite. It was a 2002 with a little less than 30.000 miles on it. But still . . . it was six thousand bucks. Maybe you'd better think again if you honestly believe that you can't find a decent car for less than ten grand.

I blame all these entitlement issues on Sesame Street and Mr. Rogers.

Gideon MacLeish

on Aug 03, 2007

For the record, my current "ride" cost $7K...the ride before that? $4k...and I put 40,000 miles on that baby (got rid of it still running, still reliable). Not brand new, of course, but personally I'm not a big fan of brand new. That means I might have to pay retail. And longtime readers KNOW Gideon's law!

ThinkAloud

on Aug 03, 2007

Today at $7.25 you're barely scraping by!!! So what you've proven is that our minimum wage has not kept up with inflation

not exactly. that $7.25 will be in 2009. but who cares ..... no one will notice.

You can always spin numbers and statistics anyway you like. It always depends on how critical you look at the numbers.

that budget, ignores soo many living necessities.clothing, medicine. Also, food and tel cost the same in 1995 as 2009?

I dont understand the purpose behind misleading information like that? if you, on principle, disagree with the min-wage idea just say so. it is understandable. But trying to spin the numbers to justify your position is not.

Without going into any statistics or fancy number-spinning here is my personal experience: In early 1970's here are the numbers i experienced myself compared to what we have now:

Item ................... Early 1970's ..................... Now ........... % increase (rounded)

Min Wage .......... $ 3.00 -3.15 ...................... $ 5.85 ............. .. 86

Gas ................ 0.33 ............................ .... 2.75 .......... ... . 733
Bread/loaf ............. 0.75 ........................... .... 1.99 ........... ... .165
Chicken (whole) ....... 2.50 .......................... ..... 5.0 .......... ...... 100
Elec/KWH .......... 0.05 .... ....................... ... 0.19 ................ 280
Natural Gas/Therm .... 0.3 ... ....................... ... 1.59 ............. ... 430
VW Beatle new .... 1999.0 ...................... >15000.0 .............. ...650
Avg Groc./ wk for 2 ...15.0 ......................... 100.0 .......... ... 500

Avg % increase in cost of living: 408% while the min-wage incres is only 86% in 35+ years.

Now, what do you say? Sorry if the table looks crooked

Draginol

on Aug 03, 2007

These days, the prospect of the american dream is reduced to living in a particular state in middle-america, and eating rice & beans.

Yes, if you're an unskilled worker you have limited options. The solution: Get some skills.

Businesses still have to compete in a global economy. Wonder why everything's being made in China? Becuase labor is so cheap there. If I were running a business that dependend on low skilled labor, I would certainly be moving my factories overseas or to at least Mexico before the huge increase hits.

The same people who decry that minimum wage should be higher seem to be the ones who have no problem buying foreign products if it saves them money. Consumers certainly don't seem to care about how the product they use is made, they go by price and quality. It seems the height of hypocricy to force employers to pay more than they want to and what a worker is willing to work for while consumers have no such limitation in how they spend their money.

And so we'll see the cycle continue -- low skilled jobs will be outsourced and the same people who support minimum wage will scream about outsourcing and demand more welfare programs for the native unskilled workers who find themselves without jobs.

danielost

on Aug 03, 2007

in salt lake just before the raised minimum up from 4.50 an hour. McDonald's was paying a starting wage of 6.00 an hour. why because they couldn't find anyone to work. there were help wanted signs in every block with businesses. the day after the minimum went up to 6.00 an hour. all of those signs disappeared.

Gideon MacLeish

on Aug 04, 2007

These days, the prospect of the american dream is reduced to living in a particular state in middle-america, and eating rice & beans

I resent that! We eat rice and beans a couple of times a week. But apparently us "po'folk" ain't up to your standards, and as long as we're not eating Beef Wellington, we ain't up to the likes of rich snobs like you!

danielost

on Aug 04, 2007

VW Beatle new .... 1999.0 ...................... >15000.0 .............. ...650

these two cars are not the same

Gideon MacLeish

on Aug 04, 2007

Avg Groc./ wk for 2 ...15.0 ......................... 100.0 .......... ... 500

This number doesn't correlate either. More Americans buy processed foods, which are more expensive. I can tell you for a fact I can feed my ENTIRE FAMILY (8 of us) on less than $100/week...and we DO spend less. It's all about choices. As for bread, I don't pay $1.99/loaf, but I suppose the same crowd that's too good for rice and beans would be too good to buy their bread at a thrift store, where it's less than HALF that...for GOOD quality, whole grain bread!

Texas Wahine

on Aug 04, 2007

Man, I paid freakin' 6 bucks for a gallon of milk the other day. ON POST.

Just needed to complain about that.

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