New York City Needs a Real Living Wage

Last week, the New York City Council debated the “Fair Wages for New Yorkers Act,” which would establish a minimum hourly wage, or a “living wage,” of $10 per hour plus benefits — or $11.50 without benefits — for workers hired by companies that receive more than $1 million in city subsidies. The bill was recently amended to apply only to companies that make over $5 million a year in revenue. Citywide, the bill would affect approximately five to six development projects annually, according to the Independent Budget Office.

Donald Spivack, who drafted living wage policy for the City of Los Angeles, testified that the policy has not deterred investment or development, even in low-income areas where interest in development is already weak. This criticism has been most-often leveled by Mayor Bloomberg, who has patronized the legislation as “a nice idea but poorly thought out.”Last week, the Fiscal Policy Institute, an independent research group, released a report entitled, “The State of Working in New York 2011: Smaller Incomes, Fewer Opportunities, More Hardships.” Over the last four years, weekly earnings for workers in the lower half of the wage spectrum — those who make less than $52,300 in actual earnings annually — have declined 3.4 percent in New York City. Compare this to a wage increase of 8.6 percent over the same time period for those making more than $52,300 (the NYS median wage) and the disparity is clear.

The chances of making a decent living in New York City have steadily declined since the start of the recession. New York City has lost over 121,000 middle- and high-wage jobs since July 2008. Over the same period, job growth only occurred in low-wage industries, or those paying below $45,000 a year, which added 69,000 jobs. This is mirrored at the state level.Not even our degrees can save us. Over the last four years, median hourly wages for those with a Bachelor’s degree have fallen by 4 percent, or 1.7 percent each year. This is not a new trend. Since 1990, the portion of low-wage workers in New York City with some college education has increased by 70 percent, but wages for low-income workers as a whole have declined by 8 percent, according to the Fiscal Policy Institute.

What we are left with is a more educated, more capable, workforce that is being paid less to do jobs that, most likely, do not make use their creative and intellectual achievements. Tack on thousands of dollars in high interest school loans and it is no wonder so many of our young people have lost faith in government. Americans now owe more in student loans than they do on credit cards, according to the Federal Reserve Bank. Outstanding student loans are on track to surpass $1 trillion for the first time this year.

Mayor Bloomberg likes to remind us that — whether it is with regards to Living Wage or extending the Millionaire’s Tax — we should tread lightly or risk making our city unattractive to investors and the wealthy. He says this as through the current state of our city and options for working New Yorkers are something to be envied.

It is time to face facts:
• Poverty in New York City increased to 20.1 percent in 2010, which is well-above the national average.
• Child poverty is 30 percent in New York City, also above the national average, and is greatest in single-mother households. 
• 700,000 more New Yorkers depend on food stamps than five years ago.
• Forty percent of New York City’s population is considered either poor or near poor.

New York is the most polarized city by income in the country. The top 1 percent of earners account for nearly 45 percent of the city’s total income. The hourly median wage in New York City has decreased nearly 9 percent between 1990 and 2007; at the same time average annual salary and bonuses on Wall Street doubled. Over the last four years, New Yorkers earning $100,000 or more in business and finance occupations have seen a 5.2 percent increase in wages.Despite this, lower and middle class families pay a higher share of their income in local taxes than wealthy families pay. As the 2010 census shows, immigrant and working class neighborhoods in my district, lower Manhattan, experienced zero or negative population growth over the last decade. They are the ones who can’t afford to stay.

Forty-three years ago, the Rev. Dr. Martin Luther King, Jr. lost his life fighting for living wages. He message to striking workers was, “You are reminding the nation that it is a crime for people to live in this rich nation and receive starvation wages.” In honor of Dr. King, elected officials, the religious community, and activists have voiced their support for the Fair Wages for New Yorkers Act.

Today, 18 percent of New Yorkers make less than $10 an hour; this includes 23 percent of non-white men, and 25 percent of non-white women.The Bloomberg administration would have us believe that it is better for the economy if workers earn poverty wages. They have entrusted corporations and developers with job creation; claiming the government shouldn’t get involved in setting wages. This is a failed economic policy. There are too many low wage workers in our city. The current wage structure undermines New York City’s long-term economic stability and makes upward mobility unfeasible. This is not the American Dream. Families living on poverty level wages battle food and housing insecurity on a daily basis. They cannot save for college or experience the quality of life that every citizen of this country deserves.

The Bloomberg administration contends that if developers had to pay their employees more, they would hire fewer people. They hide behind the argument that living wage would unfairly increase the burden on small businesses and hamper investment.None of these assertions are proven. In the most exhaustive study to date of the 15 cities that have living wage laws in place, wage standards had no negative effect on employment levels, local business climate, or a city’s ability to attract investment,according to the Center for American Progress (November 2010). The report concluded that job growth does not have to come at the expense of job quality.

The benefits of living wage laws are not abstract. They are not just about money or development or investment. They are about doing what is right, just, and fair. The Living Wage movement demands that we live up to our responsibility as elected officials to protect the middle and working class and ensure that working New Yorkers can afford to live and thrive in this City. It is time for the Bloomberg administration to recognize that progress depends on the entirety of our City moving together towards prosperity, not just the 1%. 


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