President Obama Wants Us to Talk About Income Inequality. So Let’s Talk.

President Barack Obama’s State of the Union address will be considered a success if it prompts a national conversation about income inequality. So let’s get started.

If, as the president has said, American workers feel that the deck is stacked against them, for women, the cards are marked.

Women disproportionately work in low-wage sectors, live on minimum-wage salaries and, thanks to working a lifetime at unequal pay, are significantly more likely than men to outlive their savings.

As I wrote in the space a few weeks ago, according to the Institute for Women’s Policy Research, at the current rate the wage gap between men and women won’t close until the year 2058!

It’s obvious that we can’t afford the status quo. We need action on a broad range of solutions, from paid sick days and family leave, to child care that’s both high-quality and affordable, to equal pay for work of equal value.

And, as President Obama said in his State of the Union address, we need to increase the minimum wage.

Women represent nearly two-thirds of minimum wage workers. A woman working full time, year round at the federal minimum wage of $7.25 per hour earns just $14,500 — nearly $4,000 below the poverty line for a family of three. If the minimum wage had kept pace with inflation since 1968, it would be over $10.70 per hour today.

According to the National Women’s Law Center:

Since women are the majority of minimum wage workers, increasing the minimum wage would help close the wage gap. In 2012, women working full time, year round were paid only 77 cents for every dollar paid to their male counterparts. The wage gap was even larger for women of color: black women working full time, year round made only 64 cents, and Hispanic women only 54 cents, for every dollar paid to their white, non-Hispanic male counterparts.
Is it fair and logical to raise wages for working women? Of course it is.

Will it be easy? Of course it won’t.

In fact, the backlash against it has already started. Wisconsin Governor Scott Walker called proposals to raise the minimum wage a “political grandstanding stunt” that will kill jobs.

In Florida, Governor Rick Scott said the claim that working families need an increase in the minimum wage to make ends meet makes him “cringe, because I know that statement is a lie.”

And Monday’s New York Times reported on opposition to including workers who receive tips in a minimum wage increase.

The law used to be that tipped workers could not be paid less than 50 percent of the minimum wage, but this provision was changed when the minimum wage was raised to $5.25 in 1996 following a fierce lobbying campaign by the restaurant industry. Now, according to the Times, they’re at it again:

Advocates for restaurant workers protest that waiters’ pay has remained flat for years. The tip wage alone has gone unchanged since 1991: Taking inflation into account, the $2.13 enacted back then is worth $1.24 today.
But the National Restaurant Association, which has played a pivotal role in keeping the tip wage unchanged, warns that if the tip wage is raised along with the federal minimum wage, customers will face higher menu prices and fewer waiters to serve them…

Dana Dreher, who works 20 to 40 hours a week as a waitress at a McCormick & Schmick’s Seafood and Steaks in St. Louis, says she makes $20,000 a year including tips. “I don’t think the tip wage is fair — it definitely needs to be increased,” she said. “There’s so much variability in pay.”

“Sometimes I have to ask myself, Am I going to pay my rent or my utilities?” said Ms. Dreher, who has a master’s degree in social work from Washington University but has been unable to find a job in that field and owes $60,000 in student loans. “Once there was a bad snowstorm and business was really slow, and my pay was really cut. I had to plead with the woman at the utility to give me a few more weeks to pay my electric bill.”

There are some more real-life stories about living off tips, and real-world strategies to improve wages and working conditions for the nation’s 109 million restaurant workers, at Restaurant Opportunities Center United  where you can also sign the petition in support of the Fair Minimum Wage Act.

Polls show that healthy majorities of Americans support raising the minimum wage. A CBS News poll in November found that even 57 percent of Republicans support an increase, and a Quinnipiac University poll this month found 71 percent of all respondents in favor.

What’s more, a recent survey of small business owners nationwide (including restaurant owners) found widespread support for raising the minimum wage. The poll, conducted by Greenberg Quinlan Rosner Research for Small Business Majority, found that more than two-thirds (67 percent) of small business owners support increasing the minimum wage and adjusting it annually to keep pace with the cost of living. (The respondents, by the way, were predominantly Republican).

Raising the minimum wage to $10.10 per hour won’t be enough to rein in income inequality, because it’s not a livable wage in most parts of the country. But it is a start. The Economic Policy Institute estimates that if the minimum wage were gradually increased to $10.10 per hour by 2016, about 27.8 million workers would get a raise — including 11.1 million workers earning between $10.10 and $11.05 per hour, who would see their pay increase due to the higher floor set by the new minimum wage. Women are 15.3 million (55 percent) of all affected workers.

Women are the sole or primary breadwinners in roughly 40 percent of U.S. households nowadays. They and their families need a livable wage — a wage that would allow them to save up for a down payment on a house, their kids’ college tuition, and their own retirement security. In the richest country in the world, that’s not too much to expect.

Have you ever had a minimum wage job, or worked for tips? Could you live on that income today?

What do you think about raising the minimum wage, and what would you say to someone who tells you it’s too much to ask?

Originally Published on Terry O’Neill’s  Huffington Post blog on 01/27/2014

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