What's At Stake?

Tell Washington University to Pay it's Workers a Living Wage

What is a living wage?

Simply stated, a living wage can be defined as the minimum pay rate necessary to keep an individual and his or her family above the federal poverty level, which was determined in 2000 to be an annual salary of $17,050 for a family of four. This amount means that an individual must earn roughly $8.20 per hour for full-time year-round work. Importantly, the living wage level varies by city, reflecting the local cost of living.

Living wage in the city of St. Louis

In July of 2002, the Board of Aldermen of the city of St. Louis established a living wage ordinance that requires that firms that enter into city service contracts worth at least $50,000, or who receive $20 million in economic development subsidies from the City, pay their employees a minimum of $9.54 an hour with health benefits and $11.63 without. The board determined this to be the amount minimum necessary to keep a family of three above the level of eligibility for food stamps.

What it takes to implement a Living Wage at Washington University

$2,400,000- The maximum cost of a living wage for one year for all campus workers

$18,000,000- Amount of money raised by Washington University in April 2004 alone, enough to fund a living wage for workers for the rest of the decade

0.18%- The cost of a living wage would be when taken as a percentage of the University's operating budget.

Does a Living Wage Policy Hurt a Community?

Often, opponents to living wage laws cite that enacting such policy will reduce the number of job opportunities for the very persons that such a statute attempts to protect, for they believe that numerous employers throughout a city, in effort to comply with the law, will be forced to dismiss a significant number of their workers in order to raise wages. Thus, people who oppose living wage laws may believe that there will be an unprecedented level of unemployment. Others claim that living wage laws will deter businesses from establishing in communities where such ordinances are in effect because such regulations create overhead costs that are prohibitive, also, some businesses will be forced to leave an area due to the increased cost associated with an artificially imposed wage. The firms that remain in a city with a living wage law will be forced to pass the costs of wage increases on to consumers, who will incur higher costs for the goods and services they consume.

However, a 1998 Economic Policy Institute investigation of Baltimore, the first city to enact a living wage law, shows that the hypotheses projected by living wage opponents are not necessary outcomes. After 4 years of having a living wage in effect, the city saw no measurable increase in unemployment. Furthermore, there has been no evidence of investors being deterred from establishing businesses in the city after the law was enacted. The latter finding indicates that perhaps investors consider a wide-range of factors when deciding on a location for their firm, not simply the presence of a living wage law.

Benefits of the Living Wage

A living wage will bestow numerous benefits on employees, most importantly lifting them out of poverty. Providing a living wage sends the message that an employer is both literally and figuratively investing in an employee and that he or she is not expendable. In addition, Responsible Wealth, a consortium of business owners who take to heart the cause of the living wage cite three benefits to businesses that implement a living wage: 1) Reduced employee turnover and absenteeism, which will lower recruitment and training costs, 2) increased productivity, and 3) increased morale and commitment to the company. The organization also cites that furnishing a living wage to workers has the potential to foment a self-sufficient citizenry in the sense that workers receiving a living wage will be less dependent on government aid and will have more economic freedom to consume goods and services.

The Living Wage and the Washington University Community

If workers are paid at a rate that is significantly below the cost of living in St. Louis, these individuals and their families may continue to be trapped in a cycle of poverty. It is essential that Student Worker Alliance (SWA) act as an advocate for campus service workers in the living wage matter, assessing current salaries and benefits and ensuring that none is forced to accept poverty wages. Most importantly, SWA is fighting to guarantee the wage that WU workers rightfully earn.

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