The Living Wage Movement and Its Ties to the Labor Movement
by Hailey Sneed
Had the federal minimum wage risen at the same rate it had in 1968, today it would be $10.65 per hour, adjusted for inflation; and had it grown with the rate of economy-wide productivity it would be closer to $19 per hour (Economic Policy Institute 2013). In actuality, the minimum wage is currently only $7.25 per hour. Changes in labor market policies and business practices in America over the past three decades have led to wage stagnation and rising inequality experienced by an increasing percentage of the population. Full-time workers are finding themselves in poverty with no significant source of aid and no real possibility of making a comfortable life for themselves and their families. The Living Wage Movement is a social movement that is aimed at the plight of the increasing scores of those categorized as working-poor in an attempt to mitigate rising inequality and raise the standard of living for those at the bottom of the wage distribution.
The Living Wage Movement is not entirely new; it is the resurgence of the much older Labor Movement. The Labor Movement began in America during the late 1800s in reaction to the Industrial Revolution; the progenitor of the wage system of economics (Luce 2002). Prior to the Industrial Revolution, America’s economy was based on production in which the average citizen produced their own goods for sale at their market value. Advances in technology made possible mass production, putting the artisan out of business and forcing him to sell not his goods but his labor to facilitate the new system in exchange for a wage.
In a wage system the owner of production aims to make a profit. The worker then is exploited by having no ownership of or control over the product she produced. This was the birth of capitalism in America and exploitation is inherent in the system. As the wage system diffused throughout the U.S. economy (as it did with many nations in that era), people perceived working for wages as akin to serfdom and their mistrust gave rise to the Labor Movement as people fought to protect the rights of workers to a decent standard of living, safe working conditions, dignity, and just compensation. Britain was first to launch a Labor Movement, inspiring America’s movement (Takahashi 2003) with the first minimum wage law passed by the state of Massachusetts in 1912 (Muilenburg and Singh 2007). After the economic crash of the Great Depression, the American government reified the pro-labor stance held by the populace by implementing many laws to protect the working public including the Glass-Steagall Act of 1933, which regulated the financial sector by banning banks from using savings accounts for investment capital, and the Fair Labor Standards Act of 1938, which instituted the federal minimum wage.
The pro-labor and pro-regulation political ideology remained intact until the 1960s when America was rattled by social unrest and political divisiveness driven by economic hardship and controversial war efforts (Takahashi 2003). As a result, political ideologies supporting free-market economy and deregulation of the financial sectors emerged, enabling the financial sector to grow without bounds.
The growing power and significance of the financial sector has created an increasingly exploitative economic atmosphere framed by the political philosophy of laissez-faire governance. Communication and transportation technological advancements actualized globalization in America. The deregulated business and financial sectors sought to optimize their profits. Large corporations are expanding unchecked by utilizing cheap production overseas and incurring massive capital gains as they increasingly deal in investments and abstract, intangible monetary “goods” and focus less on product and labor. As a result, the labor market has shifted from manufacturing to a service industry.
These changes have had significant effects on the average American worker. Traditionally, service jobs have been less valued than manufacturing jobs and most other occupations. Due to the nature of service work, there is little room for advancement which means that a large portion of the labor force is base-line devalued compared to their pre-globalization counterparts. “Inequality fueled by broad wage stagnation is by far the most important determinant of the slowdown in living standards growth over the past generation…” (Economic Policy Institute 2014: 23). Wages for the bottom 80th percentile have stagnated, or in some cases decreased, in spite of rising costs of living, inflation, and increases in GDP. Despite the fact that workers are more educated than they have been in the past and that the average person works 167 hours more per year, 27.5% of U.S. workers earned poverty level wages in 2013 (Economic Policy Institute 2014).
Working full-time on the today’s federal minimum wage will not generate enough income to allow someone to lift themselves out of poverty, and coupled with laissez-faire economics, global competition, and an overall increase in exploitation exacerbated by business deregulation, the average American worker has little chance of providing himself with a decent standard of living. The Living Wage Movement is a reactionary movement by the victims of structural inequity and is the first stepping stone in the modern incarnation of the U.S. Labor Movement.
Most scholars have agreed that the Living Wage Movement has arisen out of a different set of circumstances than that of its predecessor and therefore has acquired a different group of constituents which have adopted a new set of tactics and mechanisms to achieve its goals. The demographic shift in the labor market also means a shift in the demographics of the labor movement. Due to the large decrease in manufacturing jobs, most jobs found in the labor market today are service jobs which have traditionally been paid low wages and primarily comprised of women and minorities.
The main concession among the literature is that the Living Wage Movement primarily utilizes grassroots activism and coalition building over more centralized institutional action. Takahashi (2003) argues that “New Federalism” (referring to the more conservative policies devolving power from federal government to the states as well as responsibilities of welfare to the states, communities, and individuals) has actually set the stage for and ignited what she calls the New Labor Paradigm. By decentralizing power over economics and public policy, New Federalism inadvertently rendered community based organizations capable of tailoring their local governments to their ideals. The communities who had to deal with the fallout of the nation-wide growing inequality (i.e. rising rates of poverty amongst its citizens) were intimately acquainted with its negative consequences and therefore were moved to fight for what they believed to be social justice (Takahashi 2003).
Although it was not the first to pass a living wage ordinance, Baltimore, Maryland is credited with the rebirth of the “New Labor Movement” or the Living Wage Movement with the passage of the city’s first living wage ordinance in 1994 as a direct result of grassroots and coalition efforts (Reynolds 2001). Pastors of the Baltimore community noticed that while unemployment was down, poverty was up and a higher percentage of Baltimore citizens were in need of assistance even though the majority of them held steady jobs. The pastors reached out to other community groups and began the campaign, ultimately winning an hourly increase from $4.35 to $7.70 for workers falling under the parameters of the ordinance. Baltimore was responsible for inspiring activism in other cities across the U.S., raising public awareness, and reviving the term “living wage,” an important device for the movement (Luce 2002).
Takahashi (2003: 268) argues, “Communities have become structural centerpieces of the New Labor Movement.” Following Baltimore’s example, activists in the movement made networking and coalition building between unions, affected workers, religious organizations, and other community groups a main priority in order to pool resources; specifically human capital (Muilenburg and Singh 2007). To gain support from a broader base, living wage campaigns had to reframe free-market policies as inhibitors of social justice, and as a threat to the intrinsic right, personal dignity, and well-being of the hardworking American (Muilenburg and Singh 2007). According to Reynolds (2001: 35), “. . . part of framing is entering public consciousness.” The Living Wage Campaign of Los Angeles exemplifies the notion of collective action among a broad range of movement actors.
The Living Wage campaign in L.A. began when the previously unionized airport was given free-range to outsource their employees to subcontractors in 1994. Three hundred people lost their jobs as a result, and seven hundred more jobs were destined for the same fate. The Service Employees International Union banded with other local unions, community groups, and prominent people in the area to launch an aggressive campaign. Activists used phone-in campaigns to the City Council, along with theatrical demonstrations like sending the City Council empty paper plates on Thanksgiving to symbolize the hungry families working for minimum wages and those who had lost their jobs due to lax business regulation. Campaign organizers elicited help from Hollywood and got thirty-three major film and T.V. producers to write letters to the Council expressing their support for the movement. Executives from Bell Industries and Pioneer Foods wrote opinion pieces on their companies’ success with awarding higher wages to their workers. All the while, Bobbi Murray, the campaign’s media director ran human interest stories from those whose lives were significantly affected by the city’s current policies. By 1995, the campaign had successfully passed legislation that required companies receiving city contracts to retain their existing workforce and established legal protections for workers’ right to organize. By March 1997, L.A. passed the Living Wage Ordinance. Many new unions and organizations emerged out of this campaign that worked to change government policy and put pressure on non-compliant employers. Activists even succeeded in cutting a deal with UCLA Health Care to create an affordable family care package equal to $1.25/ hour (Reynolds 2001).
Activists have strategically refrained from centralizing their efforts (like in the Baltimore and L.A. campaigns) and have kept their scope small in response to the diverse political spheres in which they are forced to act (Takahashi 2003). By retaining their autonomy but participating in broad cooperation they are able to gain the support of a wide variety of organizations without being bogged down by the bureaucratization of a more centralized force. This method of organization also allows for the employment of more contentious politics like the demonstrations used by Harvard students during their own Living Wage Campaign. At the time, Cambridge had just passed a Living Wage Ordinance for which Harvard University, the city’s largest employer, was exempt. At this time the Global Justice Movement and other international movements were in full swing mounting arguments against neoliberalism, deregulation, and privatization which encouraged Harvard’s student body to challenge the institution in the name of justice. The students joined community organizations and outside political groups to navigate the political sphere outside campus; however, on campus they practiced much more contentious and dramatic politics to get the attention of fellow students, the outside world, and the administrators. They began as small disturbances, like in classes or board meetings held by the Harvard administration, or they posted facts about how Harvard was keeping their workers’ wages below the poverty line. Once they gained what they believed to be the critical mass of support needed for their cause they implemented more aggressive tactics such as the three week long sit-in of one of the campus buildings. After the students had effectively marred the image of the Harvard administration, in conjunction with the barrage of outside pressure from the community, the students’ organization won a $10/hour living wage ordinance for Harvard employees, which included clauses for the value to adjust with inflation and one that extended the coverage of the ordinance to the employees who were subcontracted through other companies. Overall the ordinance cost the University $10 million dollars, or ½%-1% of the annual budget (Offner 2013).
While many around the world have criticized the U.S. Labor Movement as being weak and unorganized, the decentralization of the Living Wage Movement may have been its greatest strength. The movement’s organizers were strategic in the way they eased the notion of the “living wage” in to both the public consciousness and political landscape. Instead of attempting to gain living wages for everyone, they first demanded it of the businesses which received subsidies from state and local governments. By taking this route, activists were able to appeal to the public’s emotions by arguing that their tax dollars were being used to pay wages that kept people in poverty. All the while they were avoiding a battle with the free-market and its ideology. Although the downfall of this strategy would appear to be the very short reach of the ordinances, the activists in the Living Wage Movement did not want to stop at winning higher wages for employees tied to the tax base (Bernstein 2004). The goal of the Living Wage Movement was to achieve a higher standard of living, dignity, and just compensation for everyone just like the laborers before them. Today, the same activists who fought and won living wages for the few are still fighting for living wages for all. Now they are pushing for a much higher federal minimum wage.
The movement, although somewhat slow in coming to its main goal, a higher minimum wage, shows no signs of giving up any time soon. There is wide public support for a minimum wage hike regardless of political affiliation. In a survey by Hart Research Associates, eighty percent of Americans (62% of which were republican) were in favor of a $10.10/hour minimum wage (Huffington Post 2013). Prominent conservative republicans such as Mitt Romney and Rick Santorum have expressed their support for the notion as well. Even GOP states such as Alaska, Arkansas, Nebraska, and South Dakota have plans to implement a higher minimum wage; all with provisions for the value to adjust with inflation (Nichols 2014).
Even large corporations like Walmart and McDonald’s have plans to raise wages for a portion of their workers, which may have been an attempt to abate large scheduled strikes by factions of their employees. In my opinion this movement has been well-thought-out and structured. Thanks to proper planning and tactful maneuvering, the movement has managed to work their definition of social justice into the minds of the populace and the law books. The Living Wage Movement is still in effect, although I would argue that now it has graduated to the status of Labor Movement, and I fully expect to see the federal minimum wage resemble that of a “living wage” within the next ten years. There are no alternative paths to their goals that I can see other than the one these skillful actors have taken. Overall, I believe this particular segment of the modern-day Labor Movement has been very effective and has laid a solid foundation from which a full-fledged Labor Movement can be rebuilt.
REFERENCES
Bernstein, Jared. 2004. “The Living Wage Movement: What Is It, Why Is It, and What’s Known about Its Impact?” Pp. 99-140 in Emerging Labor Market Institutions for the 21st Century, edited by R.B. Freeman, J. Hersch, and L. Mishel. Chicago: The University of Chicago Press.
Economic Policy Institute. 2014. Raising America’s Pay: Why It’s Our Central Economic Policy Challenge (Briefing Paper, No. 378). Washington, DC: Economic Policy Institute.
Economic Policy Institute. 2013. Raising the Federal Minimum Wage to $10.10 Would Lift Wages for Millions and Provide a Modest Economic Boost (Briefing Paper, No. 371). Washington, DC: Economic Policy Institute.
Huffington Post. 2013. “80% Want Minimum Wage Raised to $10.10 per Hour: Poll.” Retrieved April 22, 2015 (http://www.huffingtonpost.com/2013/08/01/minimum-wage-poll_n_3691118.html).
Luce, Stephanie. 2002. “The Full Fruits of Our Labor: The Rebirth of the Living Wage Movement.” Labor History 43(4): 401-410.
Martin, Andrew W. 2008. “Resources for Success; Social Movements, Strategic Resource Allocation, and Union Organizing Outcomes.” Social Problems 55(4): 501-524.
Muilenburg, Kamal and Gangaram Singh. 2007. “The Modern Living Wage Movement.” Compensation and Benefits Review 39(1): 21-28.
Nichols, John. 2014. “For a Living Wage.” Nation 299(18): 4.
Offner, Amy. 2013. “The Harvard Living Wage Campaign: Origins and Strategy.” Employee Responsibilities and Rights Journal 25(2): 135-142.
Reynolds, David. 2001. “Living Wage Campaigns as Social Movements: Experiences from Nine Cities.” Labor Studies Journal 26(2): 31-64.
Takahashi, Beverly. 2003. “A New Paradigm for the Labor Movement: New Federalism’s Unintended Consequences.” International Journal of Politics, Culture and Society 17(2): 261-278.
