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Letters to the Editor
Wednesday, November 29, 2006

« I am my parents' child, not their adopted child | Main | Who will be left? »

Living wage idea is just -- and credible

The following is a Counterpoint:

By Larry Morse

Regarding recent articles about the merits of living wage legislation in North Carolina: The idea of a living wage is not new. For example, in 1891, Pope Leo XIII issued a papal encyclical proposing what today we would call a living wage.

Why would the pope have done that? I think the answer is clear. Christianity, and the other major religions, teach that we -- as individuals and as a society -- are judged by how we treat the least among us.

Can we say that we have a just society when millions of individuals work full time and yet do not earn enough to allow their families to escape poverty? Needless to say, it was with pleasure that I read Gov. Mike Easley's endorsement of a statewide living wage.

"Despite the absence of correlation between the minimum wage and the unemployment rate, most economists believe that the minimum wage does contribute to teenage unemployment." UNCG Professor Bruce Caldwell seems to be among the "most economists" in this quote from a "Principles of Economics" textbook. Let me provide some of the economic evidence that Professor Caldwell did not mention.

Recent studies using original surveys in Boston and Los Angeles found that the workers affected by the living wage ordinances were mostly adults and mostly working full time, not primarily teenagers, as Caldwell implied. Caldwell describes those working for minimum wages as being "spread throughout the income distribution." While technically correct -- as in the case of a teenager in middle-class family working for minimum wage -- it ignores the income level of the great preponderance of minimum-wage workers.

For example, the Boston and Los Angeles studies found that most living wage workers were in households struggling to meet a basic-needs budget.

As for employment effects? In Baltimore and Boston, empirical studies have found no evidence of diminished employment. In Los Angeles, surveys of workers and firms show that job losses affected just 1 percent of workers getting a raise. Two studies of San Francisco's living wage policies found employment increased among airport workers and home health care workers. Exceptions to the general conclusion of research on living wages are the studies by Neumark and Adams. They find relatively large employment losses associated with wage gains. Many researchers have challenged the studies' methodology, and their findings are largely discredited.

The 80 percent of the general electorate has it right: All workers should earn a decent wage.

The writer is associate professor, Department of Economics, N.C. A&T State University.

Comments (5)

I'm sure Mr. Morse is much smarter than I am, and as my degree is in Sociology, perhaps he can enlighten me on one detail regarding his post.
Most people in America are employed not by huge conglomerations with billions in profits, but by tens of thousands of small enterprises which have to squeak by to make payrolls while struggling with massive federal rules and regulations. Small businesses are the oil that keeps the free enterprise system working.
How, then, will doubling the (already) greatest cost of doing business for America's employers do anything but sink many of these businesses, sending employees not to other businesses but to bread lines in an economy that would be gorged with massive unemployment and inflation of even the most needed comestibles?
As I said, I am merely an observer of groups of people, but I have been an owner of a small business that was so encumbered by federal, state and local regulations that I had to hold off hiring any employees for fear I would have to terminate them due to additional choking oversight. No bitterness here; I now feed off the government teat.

The NC Justice Center cites substantial studies showing that raising the minimum wage does not increase job loss, does not hamper the growth of small businesses, and does not spur business failures. See the link here:

http://www.ncjustice.org/media/library/696_ibminwage4102006.pdf

But a more important reason for supporting living wages is because it is one more step toward creating an economic system that serves people -- instead of an economic system that people serve. It's absurd

The opponents of living wages seem to believe the economy would collapse if everyone were paid a living wage, when in fact, just the opposite would occur. The economy would adjust and grow. Crime would fall, education levels would rise, health would improve, etc. A living wage presents a win-win for society as a whole, which is a more legitimate reason for supporting it than the appeal to Christian principles, however well-meaning those may be.

Furthermore, any business that can only turn a profit by exploiting workers with low wages (or polluting) probably isn't doing much for the community where it is operating, and it would be better off in the long run that it fail. Unfortunately, the minimum wage of $5.15 creates an incentive for poor business management.

Seems kind of strange that education levels would rise. Why bother getting a degree or being educated if I can sweep floors and earn a living wage?

Think of it this way, nitpicker: sweeping floors is still a low-prestige job. Many people want to get "higher-class" or higher education jobs. If a floor sweeper is only working that one job instead of the two or three jobs many low-skilled people have, maybe they can use the time to get more education or training.

I have had more students than I care to think about drop out of my classes because they needed to sleep for four hours before going back to work. And my students want to learn; it isn't that they're lazy. It's that they are too exhausted to think clearly.

Been there and done that, beadbaby. I remember working 10 hour shifts before reporting for calculus class many years ago.

Thanks for the response.

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