To Fix National Poverty Crisis, Study Shows Even $15 Wage Won't Do the Job

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To Fix National Poverty Crisis, Study Shows Even $15 Wage Won't Do the Job

New report says federal minimum wage should actually be $16.87 to match high cost of living nationwide

In Washington, D.C., workers would have to make at least $21.86 an hour just to get by. (Photo: Adam Croot/flickr/cc)

There are few states in the U.S. where a $15 hourly wage is enough for workers to make ends meet, and a true livable wage would amount to no less than $16.87 an hour, a new report published Tuesday has found.

Even making $15 an hour, which is roughly double the current federal minimum wage, would force a single adult to cut back on essentials like food or medicine in 35 states and Washington, D.C., according to the report, Pay Up: Long Hours and Low Pay Leave Workers at a Loss (pdf), published by the Seattle-based Alliance for a Just Society. For working families with children, the cost of living is even higher, while women and people of color often make even less than their colleagues.

Meanwhile, according to the study, there are no states in the country where the living wage should be less than $14.26 an hour.

"A wage that keeps families trapped in poverty and despair, no matter how hard or how many hours they work, is a national crisis," said Alliance associate director Jill Reese.

The nationwide movement to raise the federal minimum wage to $15 an hour has captured the imagination of workers and won tangible victories in recent years. However, according to the report's author Allyson Fredericksen, $15 may not be high enough to lift people out of poverty. "Momentum has built around $15 as the magic number that will allow workers to make ends meet," notes Fredericksen. "But is $15 really enough to ensure financial stability?"

"It's not unheard of in our country that someone is working full time and is still homeless—this is unacceptable."
—Jill Reese, Alliance for a Just Society

"Our emphasis...is to show just how modest a figure $15 really is," Fredericksen told Common Dreams. "It is not an extravagant wage and it is not the only solution."

Fight for $15 has helped bring national attention to workers' rights, which in turn have become a central focus of the 2016 U.S. presidential election. Sen. Bernie Sanders (I-Vt.), who is running for president as a Democrat, in July introduced legislation to raise the federal minimum wage to $15 an hour. His chief rival for the nomination, former Secretary of State Hillary Clinton, has voiced doubt that a push for $15 would make it far on Capitol Hill and suggested that $12 would be more likely to succeed.

The report's publication coincides with the first televised Democratic presidential debates, which will air Tuesday night. The candidates are expected to discuss the wage issue—and it's likely Sanders will call attention to the divide between his and Clinton's positions as a way to galvanize support among low-wage workers, young people, and struggling middle-class workers.

The lowest-paying jobs in the country are found within the service industry, such as retail, food, and childcare—occupations that "help us live our lives," the report states. And yet, a single adult wouldn't make enough to provide for themselves in any state with the paychecks they'd get from any of those fields, according to the report's calculations.

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Fredericksen used statistics from the U.S. Department of Labor, the National Employment Law Project, the National Women’s Law Center, and other economic and policy groups to assess living wages per state last year.

In Washington, D.C., with its sky-high cost of living, employees would have to make at least $21.86 an hour just to get by. The district recently adopted a $10.10 minimum wage—which means workers would have to put in over 83 hours a week just to afford their essentials.

In fact, Reese added, "it's not unheard of in our country that someone is working full time and is still homeless—this is unacceptable."

"The answer to low wages is not expecting people to work a ridiculous number of hours, or to make severe cutbacks in basic necessities," Fredericksen said. "Instead, the answer is to pay workers enough to ensure that full-time employment provides some measure of financial stability. Our research shows that's twice the current minimum wage in many states."

The report recommends more than a pay hike, however. Just as important is support for unions and collective bargaining; guaranteeing paid sick leave; strengthening and enforcing equal opportunity safeguards; and investing in safety net programs and living wage jobs. To offset increased costs to businesses, the government should provide subsidies that support employers who raise their workers' wages.

"It is time for policymakers to move beyond $15, and to implement policy change that will ensure that all workers can support themselves, can support their families, and have the support and protections they need to thrive," the report concludes.

As for what it would take for states to adopt their recommended federal minimum wage of $16.87 an hour, Fredericksen said, "Community organizing and worker-led organizing can make real change as we've already seen in New York and in Seattle, and the same type of organizing is likely to work in other parts of the  country, as well. Other tools such as increased collective bargaining and addressing the actual cost of living can also go a long way toward helping workers make ends meet."

"People across the country agree that workers should be paid enough to make ends meet; unfortunately, there is political gridlock at all levels of government that can and does stall the minimum wage from increasing," she added.

In Seattle, where the Alliance is based, businesses are already starting to adopt the $15 hourly wage that passed into law in June 2014. "The economy is booming, with new restaurants and businesses opening. Workers who have seen even the initial increase are benefiting," Fredericksen said. While it will take some time for the law to come fully into effect, she added, "we can say so far that the sky didn't fall."

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