:: Flipping burgers
The fight for a living wage
by David Hoppe
“Flipping burgers.” That used to be one way of saying you were stuck in a dead end job. It was the last resort, what you might have to do after everything else in your life fell through.
So the recent demand by some fast food workers for double the wages they are customarily paid has created more than a little back-and-forth among pundits and policy wonks.
On the one hand, you’ve heard some people saying those workers are living in a fantasy world. A burger flipper at McDonald’s currently makes within 50 cents to a dollar of the minimum wage in his or her state. In Indiana, this is $7.25 per hour; House Democrats tried to up that by a dollar in the last legislative session, but were voted down by Republicans — and not because a dollar wasn’t nearly enough.
The workers’ critics say raising pay to $15 per hour would risk running even a mega chain like McDonald’s out of business. They point out that although Mickey D’s posts impressive profits, the profit margins of various stores tend to be pretty thin. Doubling workers’ wages would, they claim, mean higher prices, and this could drive away a large share of customers.
What’s more, these critics say, nobody is supposed to make a career working at McDonald’s. The fast food business model is based on being able to hire workers, like teen-agers and housewives, who supposedly have other means of support.
This rickety premise was exposed in July, when McDonald’s published a budgeting guide for its low-wage workers called “Practical Money Skills.” In order for the math in a sample monthly budget to add up, a worker had to manage not one, but two jobs paying almost the same amount.
Those who support the workers say that paying a respectable wage will actually be good for businesses, McDonald’s included, because it will put more spending money in workers’ wallets. This argument dovetails with proposals, including one by President Obama, to raise the federal minimum wage. It claims that enabling workers to earn above the poverty line has the added bonus of weaning them away from federal benefits they currently need to make ends meet, like food stamps and Medicaid.
What both sides fail to sufficiently acknowledge is how the workers’ demand for double the wages reflects the way our economy has changed.
As Steven Greenhouse pointed out in a recent New York Times article, wages have fallen to a record low as a share of America’s Gross Domestic Product. Until 1975, wages tended to account for more the 50 percent of the nation’s GDP. Last year that figure was 43.5 percent.
A number of factors, including the outsourcing of jobs overseas, as well as the adoption of new, labor-saving technologies, have driven wages down at the same time that productivity — and corporate profits — have spiked. Greenhouse cites the Economic Policy Institute’s (EPI) finding that from 1973 to 2011, worker productivity grew 80 percent, while median hourly pay, after inflation, grew by just one-eighth that amount.
The college-educated have not been immune to these changes. The EPI found that 70 percent of college graduates have had their after-inflation hourly wages decline since 2000.
Even union shops have been hit. The United Autoworkers, for example, has agreed to what are called two-tier contracts that offer new employees a less advantageous deal than older workers were promised.
But then we don’t make things the way we used to. According to the Information Technology & Innovation Foundation, America lost about 33 percent of its manufacturing jobs in the 2000s, a rate of loss worse than during the Great Depression. In 2010, 13 of the 19 U.S. manufacturing sectors were producing less than in 2000.
This decline points to a larger trend that’s taken hold in the past five years: the increasing disappearance of midwage, midskill jobs, or what Annette Bernhardt of the National Employment Law Project calls “a good jobs deficit.” A study by Bernhardt’s organization found that low wage jobs have accounted for 58 percent of job growth since the recession was declared over.
Contrary to the latest wave of education reformers, our president included, not everyone is cut out for a career in science, math and technology. That could be why so many of us wind up flipping burgers — or making boutique coffee drinks, or selling the latest gizmos in some high-end culinary emporium. These jobs may not be glamorous, but they employ an awful lot of bright, hard-working people. Those people shouldn’t have to depend on government assistance to get by. Maybe when we think about freedom, one thing we should consider is how many ways are left in this country for someone to make a decent living.