Would you like to subscribe to our newsletter?

Current Conditions Clear  2.1°C

Kamloops News

THOMPSON: It's time for a new definition of a 'living wage'

January 10, 2022 - 12:00 PM



What would you say is a living wage? Is it $15 an hour? $20? More? It’s not a topic most of us think about too long or too often. I mean, beyond our concern of what we earn personally - or what our loved ones make - it isn’t often a top-of-mind consideration.

What the hell is a living wage anyway? Well, it probably depends on who you ask. I doubt, for example, that socialist revolutionary Karl Marx, Nobel-Prize-winning economist Paul Krugman and John Kenneth Galbraith, Canada’s most famous economist - all smart people - would be in the same postal code of agreement on the definition of a living wage.

Most of us relate what burger flippers are paid today versus say what we got paid for our first jobs. In such cases both our memories and our willingness to give a sucker a break…well, let’s say we usually fall short.

In our memories we were all great workers on that first job…especially us older folks. Good thing most of our first bosses have passed…their perspectives would likely differ from ours. Good or bad though…we never missed a pay day.

And sadly maybe it’s a little bit of human nature that we often don’t want those who follow us to have as good - and certainly not better - shot at life…much less the good life. I’ve heard countless folks say things like, “I don’t want (fill in the blank with an Okanagan town) to grow any bigger!” Right, put up that wall now that I’m here.

If you like some place…chances are some others might like it, too. There were only 11 million people living in Florida when I graduated from high school there in 1968…now there are 22 million. Hmmm…who knew lots of people would love palm trees, sun, warm weather and year-round golf and boating?

But back to what makes a living wage. This riddle - and it is - perhaps should consider both the human component as well as the purely numerical component associated with where you live. I mean, who determines what “living” is? Where along the continuum between poverty and wealth do we peg what living is…and thus, what a living wage is?

Economists and government officials use a few different “living wage calculators” to try and solve this conundrum…the most widely used is designed by Amy Glasmeier, professor of Economic Geography and Regional Planning at Massachusetts Institute of Technology.

The professor considers factors like the number of children and working adults in a household, the cost of housing, day care, transportation, out-of-pocket health care costs, food and other recurring expenses, like cleaning and laundry supplies.

I’m guessing professors at M.I.T. make…well, a pretty good “living wage”…not like the wages she proposes for, you know…others. My guess is she probably dines out on occasion, buys gifts for family and friends, tucks some away for retirement and keeps a slush fund for that inevitable car repair or a long weekend at a resort every so often.

But neither her “living wage calculator” nor any others consider any of those real-life expenses as necessities. Since when is saving for a rainy day or repaying debts a luxury? The professor’s calculator did - in a concession to how people actually live today - add this year both cell phone and internet access costs. Maybe we should call them “tough love calculators?”

It wouldn’t be fair to write about “living wages” and not include what corporations pay their top executives. Let’s consider just one executive in every public company…the Chief Executive Officer…or CEO.

In 1980, my boss, Irv Shapiro, Chairman and CEO of the Du Pont Company, made a base salary of $865,000, plus bonuses and stock options…which doubled his compensation to about $1.7 Million…the equivalent today of about $6 million.

Last year, CEOs of the 350 largest corporations in the U.S. realized - on average - annual compensation of $24.2 million each. That was up 18.9 percent over 2019…an increase during the pandemic when many workers - even those at the 350 largest companies - actually lost pay...or jobs.

CEO realized compensation - what they actually received - between 1980 and 2020 grew 1,322 percent…better than the S&P stock market growth of 817 percent.  Realized compensation - the “living wage” for the average worker in those years grew by 18.9 percent…less than one-half percent a year.

Things are no better in Canada. Before noon this past Tuesday, Jan. 4 - the first official work day of the year - every CEO of Canada’s top 100 companies had made what the average Canadian earns for the entire year…$53,482.

There are all kinds of arguments that political ideologues offer up on why working folks can’t make a “living wage”…like the common refrain that a “living wage” would force employers to hire fewer workers…wrecking the economy. Nobel-Prize-winning economists say not true…but politicians say otherwise…wonder who is right?

Shouldn’t a successful company pay workers a living wage? Perhaps those who can’t should not be in business…survival of the fittest. That seems no more harsh than expecting someone earning $10 a hour to live on annual income of $20,800?

Oh, before you suggest that workers today aren’t as productive as in the past…well, that’s not true either. The stagnation of wages happens because of the trend of concentrating wealth in the hands of the few within corporations…rather than lower productivity, according to three living Nobel-Prize-winning economists.

We can disagree about what sort of life a “living wage” would make possible. But, honestly, doesn’t it just feel wrong that those who care for our children, deliver our packages and wait on us in stores don’t make enough to take their families out to dinner once a month, and I’m talking fast food. Forget saving for those golden years of retirement or a future vacation, they can’t afford a decent life today.

My point is…this is a discussion we need to have as members of society. Leaving the welfare of our fellow citizens in the hands of university professors and politicians hasn’t delivered a “living wage” to those living on the edge…or those already over the cliff. Maybe we should consider what wage makes it possible to live rather than exist?

— Don Thompson, an American awaiting Canadian citizenship, lives in Vernon and in Florida. In a career that spans more than 40 years, Don has been a working journalist, a speechwriter and the CEO of an advertising and public relations firm. A passionate and compassionate man, he loves the written word as much as fine dinners with great wines.

We welcome your comments and opinions on our stories but play nice. We won't censor or delete comments unless they contain off-topic statements or links, unnecessary vulgarity, false facts, spam or obviously fake profiles. If you have any concerns about what you see in comments, email the editor. 

News from © iNFOnews, 2022

View Site in: Desktop | Mobile