The Fight for $15 Changed How We Talk About—and Raise—the Minimum Wage
For millions of low-wage workers all over the country, name tags come with the job.
Yet, the methodical tasks their work requires—flipping burgers, stocking shelves, changing bedsheets—have reduced these laborers to nameless doers. Instead of millions of individuals, America’s convenience economy is served up by a homogeneous army of uniformed workers churning out uniform Caramel Macchiatos coast to coast.
After years of protests for better treatment in the workplace and livable wages, America finally came face-to-face with some of the faces and feelings of low-wage workers in 2015, with stories about moms who lost their jobs trying to take care of a sick kid and dads like 36-year-old Terrence Wise. In a pivotal moment for the Fight for $15, a labor movement born in 2012 that’s fighting for more than doubling the $7.25 federal minimum wage set in 2009, Wise stood alongside President Barack Obama in October to talk about the struggle to raise three girls on his income from two fast-food jobs—earning $8 an hour—and his wife’s $10-an-hour home health care job.
FULL COVERAGE: How 2015 Changed the Future
“The wages are so low, we skip meals. We’ve been homeless while I work my two jobs, and I barely get to see my daughters,” Wise said at a White House podium.
With a presidential election looming next November and unions continuing their long unraveling, politicians are campaigning on an economy that—despite incredible growth and many improvements—has not restored the American middle class or brought dignity to the country’s low-wage earners.
When it comes to pay, workers were trapped in a years-long doldrums before 2015. That was evident in Wise’s experience and countless stories of fast-food workers who took to the streets to protest low wages—and damaging misperceptions that have helped to hinder the growth of a wage that couldn’t support a college student, let alone a family. Such stories have helped the zeitgeist bid farewell to the era when teens were known to buy cars with hourly wages paid by hamburger jobs, à la Fast Times at Ridgemont High. Since the recession, the low-wage sector has added 1.85 million jobs, while nearly 2 million jobs have been lost in mid- and higher-wage industries. That means more families are surviving on the minimum wage. Federal labor officials say if the wage were raised to $12 an hour—as presidential hopeful Hillary Clinton is proposing—89 percent of those who would benefit are over age 20, and 56 percent are women.
The Fight for $15 had a banner year in 2015, with its scrappy protests giving way to political traction and improved wages in a number of major cities. Workers like Wise made their way to front pages and to the White House, casting aside a not-so-distant memory of the Obama administration’s failed proposal, announced last January, to raise the minimum wage to $10.10. The president implemented that pay by executive order for federal employees in early 2014. And the flood of protests won’t end at a $15 wage, leaving another battle for better pay for another day—new wage laws are pushing to take politics out of the process and lock in automatic raises that are tied to economic factors. That could mean a stabilization of an economy that has increasingly relied on low-wage earners well beyond 2015.
Yet, the highest wage increases that have been written into law through major demonstrations and a huge national push only affect a handful of cities and will take time—years—to come into effect. Seattle’s $15 wage won’t take effect until 2017. A year later, San Francisco’s wage will hit that mark. It will take Los Angeles until 2020 to get there. When it comes to statewide minimum wages, 13 states will raise theirs in 2016—of those, three will hit or exceed the $10 mark when they do.
The minimum wage, when adjusted for inflation, has been steadily declining since 1979. National Employment Law Project researcher and policy analyst Yannet Lathrop noted that there was a time when Americans considered raises to the minimum wage more regularly.
“It’s pretty sad to look at how infrequent we look at how to help these lowest-paid workers,” Lathrop said. “These gaps in years, the inflation is going up—basically it continues to go up every year—and the values of these minimum wages fall without any action from legislation. So even if it’s just a five-year gap, during that five years it makes a difference whether workers are able to make ends meet or not.”
The truth is, low-wage workers aren’t the only ones suffering: Most wages don’t keep pace with inflation, let alone grow. Broad wage stagnation is to blame for American inequality, according to the Economic Policy Institute, a left-leaning think tank in Washington, D.C., which dubbed raising America’s pay the “central economic policy challenge” for the country in a report last year.
Wages have long been stagnant and have failed to take into account cost-of-living increases since the recession ended in 2009. On average, every worker in the U.S. saw a 4 percent decline in wages between 2009 and 2014, a so-called period of economic recovery. The hardest hit were workers in the bottom 20 percent—janitors, home health aides, maids, to name a few—who saw an average of a 5.7 percent decline in that period, according to the National Employment Law Project. For example, when cost of living is taken into account, full-time restaurant cooks earned 8.9 percent less in 2014 than they did in 2009—a loss of about $437, or about two months’ worth of groceries.
“I think what most people might realize is that they’re not getting a raise or making more money every year, but what it means in terms of their purchasing power is that they’ve actually lost” a substantial amount of what labor economists call real wages, Irene Tung, a researcher with the National Employment Law Project, told TakePart. Tung coauthored a report released on Labor Day that recommends raising the national minimum wage to $12—except in major cities, where it recommends a $15 wage. The gender wage gap is persistent across the economy, with women making 79 cents on the dollar a man takes home. Yet, even when just looking at minimum wage jobs, there is inequality: women make about 13 percent less than men for doing the same work at fast-food restaurants and retail chains.
The only thing that seems to grow is debt. College students graduate with anvils of promissory notes shackled to their ankles; new homeowners sign off on notes promising 30 years of monthly payments for housing that costs much more than it did 30 years ago. And wages remain unchanged as interest collects on those debts and the cost of living grows.
Conservative politicians have long championed trickle-down economics as bringing wealth to the American worker, saying that reducing taxes and regulatory burdens on corporations will automatically result in the sort of largesse that results in better pay and benefits for workers. Looking at numbers like those in the National Employment Law Project’s study, American workers can now comfortably report that there is an invisible clog in this supposedly laissez-faire method of profit distribution in which capital drips down from the top of the heap. In fact, economists say raising the minimum wage has a more proven effect in the opposite direction—trickle-up economics, if you will. That’s because when low-wage earners get an increase in income, they immediately spend on basic necessities and even some longed-for items.
“It trickles up in the sense that the lowest-income workers are the ones that are most likely to spend at their local grocery store, as opposed to stashing their extra money in some offshore account,” Tung said.
Earlier this year, when Los Angeles became the largest city in the country where labor activists won the Fight for $15—after a back-and-forth that moved the target wage a couple times—The Washington Post dubbed the $15 hourly rate “the new gold standard for wage campaigns in big liberal cities.” But workers in L.A. won’t see paychecks based on that gold-standard wage until 2020.
Like cities around the country, L.A. has implemented a years-long schedule to pay better wages and start a slow drive out of poverty that has had wage workers relying on public benefits to make ends meet—a University of California, Berkeley, study found that about $152.8 billion in tax dollars goes toward supporting working families every year. About half of all workers in fast food, child care, and home care rely on public assistance programs, such as food stamps, to make ends meet, the April 2015 study found.
While a slow rollout allows businesses time to accommodate the changes to their payroll, Lathrop notes that a $15 wage that was swiftly imposed in Seattle-Tacoma didn’t appear to harm businesses a year after passage and despite complaints from businesses lobbying against wage increases.
“The opposition is always claiming that this means businesses are going to close and there will be a disaster on the job front, and that isn’t usually the case when we raise the minimum wage,” Lathrop said.
Still, those years to full implementation are a long time to wait for some families who have been struggling to cope in cities that are swiftly changing and in many cases pricing them out. Economists say that if the minimum wage had kept pace with inflation, or if it were tied to productivity, it could be as high as $21.75 today, because workers are doing more for less. The minimum wage kept pace with productivity numbers—which means the lowest-paid workers in America got an even share of economic growth—between 1947 and 1969, according to the Center for Economic and Policy Research, a D.C.-based think tank. Even the so-called gold-standard wage has a ways to go before it exceeds the $20 mark through inflation-based or median income–based indexing.
Cities that have approved wage hikes, like Seattle and San Francisco, happen to be experiencing economic booms that have sharpened the divide between haves and have-nots.
Longtime San Franciscans report that tech money has laid siege to their onetime hippie haven, driving up housing costs and flooding the city with the trappings of excess, such as a variety of vendors of artisanal ice cream in a variety of pricey and exotic flavors such as foie gras, candy cap mushroom, and Mizuba matcha green tea.
Yet, while venture capitalists flood San Francisco, every worker—say, the people working those ice cream scoops—earns a minimum wage of $12.25 today, will see a raise to $13 next summer, and come July 1, 2018, will earn the gold-standard wage of $15. That’s thanks to the city’s voters, who passed Proposition J during the 2014 elections.
In its years-long implementation, Seattle will beat San Francisco to the full $15 wage—the top wage takes effect in 2017. Seattle’s airport community, SeaTac, has become the first jurisdiction in the country to not just pass the $15 wage but implement it.
What may be the biggest win for the new minimum wage is that it will never stagnate again. Legislation in both cities ties the minimum wage to the consumer price index and promises an annual reevaluation to raise the wage.
“Every single time the minimum wage loses its value, we have to go back to the legislature to fight for another increase, and it’s a tremendous amount of resources to do that,” Tung said. Indexing these increases to the economic factors that can be mathematically proved is much more efficient, so wages go up automatically, she added.
If workers don’t have to take to the streets and expend political capital just to keep pace with the cost of living, advocates say that means they can push for more than just a basic wage. Maybe even a raise or sick leave or paid vacation. Maybe even schedules that make sense for their families.
For the rest of the country, winning an increased wage now—be it $12 or $15 or whatever a locality may be pushing for—would be meaningless in a few years’ time without indexing of some form being written into laws, guaranteeing future wage increases. Future raises to the minimum wage can be tied to the consumer price index, as in Seattle and San Francisco, or another broad economic measure, such as the median income. That way, the wage keeps pace with inflation—which isn’t high now but persistently erodes the purchasing power of all workers over time.
In addition to Clinton’s announcement that she backs a $12 minimum wage, two pieces of legislation seek to raise the federal minimum wage. One bill from the Democrats would incrementally raise the federal wage until it reaches $12 in 2020 and would tie the minimum wage to median wages for future increases.
The other bill comes from presidential hopeful Sen. Bernie Sanders and would raise the wage to $15—which taps into the current popular sentiment and the push from labor for a bigger lift. Sanders’ bill would also link the minimum wage to a buoy to make sure it doesn’t sink below a livable wage again—but his bill ties the wage to the consumer price index, which means the wage would rise at the rate of inflation.
As 2015 comes to a close, labor advocates are making it known that any candidate who intends to campaign on wages will have the attention of an important voting bloc. Ahead of a November fast-food strike, the Fight for $15 campaign put out a press release to declare that 46 percent of the workforce—roughly 64 million Americans—is paid less than the gold-standard wage, and those voters intend to back candidates who believe in economic and social justice.
“The Fight for $15 has shown it can influence the politics around wages and the economy,” Neera Tanden, president of the Center for American Progress, said in a statement. “This movement is creating a new voting bloc that frankly has too often been ignored by the political process.”