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Minimum WageBy: Desiree Hoffman |
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Women's labor has shaped the very backbone of the U.S. economy. The diversity and multiplicity of women's work contributions, both paid and unpaid, in the formal and informal sectors, have paved the foundation of America's unique economic history. Currently, women compromise 46% of the total labor force and this number is expected to grow to 48% by 2008 (Department of Labor, 2000, 20 Facts about Women Workers). Unfortunately, the vast numbers of women toiling in various industries for a hard earned paycheck is not an entire measure of success. Discrimination and harassment in the workplace, the predominance of low paying part-time jobs marked by a lack of benefits largely characterizes the job opportunities that are open to women in market. To top it off, white women who work full time are paid 74 cents for every dollar men earn whereas women of color who work full time are paid only 64 cents for every dollar men earn (AFL-CIO and IWPR, 1999, pg. 1). Despite the economic strides women have made in last couple of decades there are many more battles women have yet to fight. It is not uncommon to hear women in low wage work say that they are one paycheck away from being homeless. This state of economic insecurity for millions of working class women is frightening. On a positive note, some politicians are recognizing that women's incomes are not enough to support themselves and their families. Raising the minimum wage, although not historically presented as a women's issue, is one policy approach to boost the incomes of working women. The Fair Minimum Wage Act of 2001 (S. 277 and H.R. 665) sponsored by Senator Edward Kennedy and Representative David Bonior seeks to raise the minimum wage by $1.50 in three steps over a two-year period. Looking
at the Fair Minimum Wage Act through a feminist lens, it is critical
to point out that the main beneficiaries of this act are disproportionately
female, adult, and minority. Interestingly, policymakers such as Senator
Kennedy and Representative Bonior use gender-neutral language in the
bill to amend the Fair Labor Standards Act of 1938. Despite the strategy
used, approximately 60% of the people who would benefit from an increase
in the minimum wage would be women, almost one million of whom are single
mothers (Bernstein, Hartmann, & Schmitt, 1999, 1). The federal minimum wage is guaranteed under the Fair Labor Standards Act ("FLSA") of 1938. The FLSA is arguably one of the most far-reaching pieces of labor legislation ever enacted. The FLSA of 1938 included the following provisions: it mandated a $.25 minimum wage; it mandated maximum work hours at forty hours per work; it established overtime pay for hours in excess of the mandated number at one and one-half times the regular pay; it prohibited oppressive child labor; and it exempted a variety of workers in agriculture, executive, administrative, and professional jobs from the minimum wage standard (Nordlund, 1997, pg. 51). At first glance, it may difficult to see the gendered, racial, and class implications associated with the federal minimum wage. In this paper, one of my primary goals is to examine how concepts of race, class, and gender underpin the Fair Labor Standards Act. The first part of my paper will discuss how the construction of wages is a gendered and racialized process. In addition, from a feminist standpoint I will deconstruct economic models used to support and oppose minimum wage floors. The second part of my paper will shift its focus to contemporary debates on lifting the minimum wage floor. I will argue that raising the minimum wage is an essential policy strategy to boost the earnings of low wage women workers. I hope to convey that the minimum wage, while it is a critical policy to raise women's incomes a deeper problem exists. Women are economically vulnerable in our rapidly changing economy and even more susceptible in conservative political climates where social nets are not being put in place to cushion the impact. Finally, as the economy continues to expand and change, a key question that should be addressed is what is the future of the FLSA? What areas could be expanded upon to make the FLSA more equitable and encompassing? What are some provisions to be wary of and why? Historical Minimum Wage
Debates With the onset of the Great Depression in the late 1920's, attitudes towards work and the social meaning of wages shifted. State minimum wage laws were not sufficient to address the grossly low wages, laborious long hours, lack of job opportunities, and depressed working conditions. Thus, the economic recession paved the way for Fair Labor Standards Act. The core components of the FLSA mandated a federal minimum wage, regulated work hours and overtime pay, and even expanded coverage to men. At this juncture, the difference
between state minimum wage laws and the proposals attached to the FLSA
shifted focus from the protection of women and children against low
wages and horrendous working conditions to the promotion of the family
wage or living wage. Rates of high unemployment and the fear of job
competition from women and immigrants shaped the FLSA. Proponents of
the FLSA used living wage arguments to stir support for the legislation.
In many respects, a living wage preserved the private/public divide
between men and women. If a man's primary public duty was to earn a
living wage that would permit him to work average hours to sustain his
family at a socially acceptable level of well-being, a woman's duty
was tied to domestic work within the private sphere. Based on this idea,
a woman's paid labor would no longer be necessary since the man's wage
was set at an adequate rate that would support the entire family. Therefore,
it could be argued that the social construction of wages and economic
booms and busts are highly interdependent. The Great Depression signaled
a re-definition of women and men's roles within the home and workplace.
The social construction of the living wage reinforced this sexual division
of labor. In short, the living wage "was a badge of both masculinity
and whiteness. Preserving men's wages therefore also preserved a particular
definition of masculinity linked to being a breadwinner" (Mutari,
Figart, & Power, 2001, pg, 43). On the same token, a woman's femininity
was tied to her role in the domestic sphere. If she joined the labor
force to earn a wage, she risked being called a bad wife and unfit mother.
Concepts of race, slavery,
and economic development fashioned debates about the costs and benefits
of a federal minimum wage between the industrialized north and agricultural
south. The southern constituency opposed a minimum wage floor because
higher wages, an input in production, was seen as driving up labor costs.
The minimum wage was a financial cost southern industry did not want
to be burdened with. The final compromise between the north and south
was to exclude domestic and agricultural workers from the minimum wage,
a highly gendered and racist policy decision. As Vivien Hart explains: Theoretical Economic Models
and Feminist Critiques Neo-classical labor economists theorize that minimum wage floors are unnecessary, costly, and economically inefficient. According to "wages as price" theories, perfectly competitive markets set wages that are efficient and fair. Through the workings of supply and demand, wages are set at the point where the demand for labor is exactly equal to the supply of labor (Levin-Waldman, 2001, pg. 22). In other words, wage outcomes are based on what employees are willing to work for and what employers are willing to pay. Employees and employers are equally satisfied at this point; therefore there is no reason for the state regulation of wages. Theorists and policymakers who defend wages as prices also posit that wages are assigned a value based on the skill and duties required of a specific occupation. Wages are simply based on what the job is worth (Waltman, 2000, pg. 19) Theorists who support "wages as living" acknowledge that forces of supply and demand set wages. However, they are particularly critical of the economic outcomes. Living wage advocates "view markets as imperfect institutions where differentials in power and access to information between workers and employers are likely to create outcomes in favor of employers" (Mutari, Figart, and Power, 2001, pg. 36). Poverty and economic inequality is often the result of unregulated labor markets, therefore government intervention is highly justified based on this assumption. Living wage proponents in the New Deal era and even today fervently advocate for social welfare policies that aim to redistribute income and increase the purchasing power of the working class. The ultimate goal of a living wage is to guarantee that a workers income is sufficient to keep a family of four out of poverty. Political feminist economics such as Deborah Figart, Ellen Mutari, and Marilyn Power suggest, "wages shape, as well as reflect race, class, and gender" (pg. 26). In other words, wages are not solely determined by the interaction of supply and demand but are fashioned by cultural practices, political structures, and ideology. This radical idea implies that wages are socially constructed and that there is a power dynamic associated with who determines wage values. A classic example of how wages are socially constructed is linked to the devaluation of caring occupations, those in which a worker provides a service to someone that involves nurturing, caring, and one-on-one attention (Folbre, 2001). Teachers, nurses, librarians, and childcare workers are caring occupations usually dominated by women. The low value assigned to the wages in these occupations are linked to a woman's "supposed" natural ability to care. The power dynamic, that is, who assigns value to wages and the intersections of race, class, and gender are missing from the "wages as price" and "wages as living" economic theories. It is not by accident that women tend to be concentrated in grossly low paying jobs and it is not by coincidence that labor markets are highly stratified by race and gender. Wages mirror structures of racism, sexism, and classism. In doing so, they reinforce or challenge worker's appropriate places (Figart, Mutari, & Power, 2001, pg. 26). This complex wage setting process therefore suggests that wage determination is a result of market forces and is influenced by race, class, and gender hierarchies. The question then remains, what is the solution to boost the wages of low-wage workers, many of whom are female and minority, when the wage setting process appears to be highly complex and even impenetrable? The short-term answer lies in incremental policy solutions such as raising the minimum wage. More radical solutions favor raising the minimum wage along with a combination of other policies such as subsidized day care, paid parental leave, universal health care coverage, and access to high quality education and training programs. Contemporary Minimum Wage
Debates from a Race, Class, and Gender Perspective The Fair Minimum Wage Act of 2001 introduced by Senator Edward Kennedy and Representative David Bonior seeks to raise the minimum wage from $5.15 to $6.65 over a two-year period. In conducting research for this paper, I made Congressional visits to Senator Kennedy and Representative Bonior's offices to see what their official positions were on raising the minimum wage. Not surprisingly, the language that the legislative aides used to support the Fair Minimum Wage Act (a bill to amend the FLSA) leaned heavily toward the "wages as living" argument. The legislative aides consistently used statistics to show that poverty has nearly doubled among full time workers since the 1970's, citing the low minimum wage as a key part of the problem. Both legislative aides also mentioned that the current minimum wage fails to provide enough income to enable minimum wage workers to afford adequate housing in any area of this country. Overall, the policy analysis centered on a minimum wage earners inability to purchase the basic necessities of life such as housing, food, utilities, and health care. Their arguments were markedly similar to the living wage theorists who advocated for the FLSA. The major difference between the two being that in our current debates, the living wage applies to both men and women. Also, the idea of a living wage has transformed in meaning over the last several decades. Since the minimum wage is no longer adequate to keep a family of four out of poverty, the living wage and minimum wage philosophies are starting to be constructed as two different philosophies. In contemporary policy circles, living wage advocates argue that the minimum wage is not high enough. They want to set a higher standard to ensure that anyone who works for a living should not have to raise a family in poverty (Pollin and Luce, 1998, pg.1). Even though the living wage and minimum wage arguments are starting to diverge, strains of "wages as living" are still embedded in arguments expressed by minimum wage advocates. Like the arguments vocalized by the legislative assistants in Senator Kennedy and Representative Bonior's offices, much of the research on raising the minimum wage lacks a race and gender analysis. Much of the research spouts data to show that adults, women, and racial minorities are disproportionately helped by increases in the minimum wage. To cite a few current figures, if the minimum wage were increased to $6.65, approximately 11.9 million workers or 9.9% of the workforce would be affected (Rassell, Bernstein, and Boushey, 2000, pg. 1). Approximately 60% of the people who would benefit from an increase in the minimum wage would be women, almost one million of whom are single mothers (Bernstein, Hartmann, and Schmitt, 1999, pg. 1). People of color would also disproportionately benefit. While 11.7% of the total workforce is black, and 11.3% is Hispanic, a much higher 18.1% of blacks and 14.4% of Hispanics would get a boost in their income as a result of an increase (Rassell, Bernstein, Boushey, 2001, pg. 2). It is evident from the numbers alone that this policy serves multiple purposes. It would add $3,000 extra a year for a full time worker who makes the minimum wage. Even though this seems like a modest increase, it is important to keep in mind that many low wage women earners are forced to choose between paying a utility bill and purchasing groceries. An increase in additional income would allow a single mother to buy groceries, medicine, school supplies for her children and even expand her housing options. The minimum wage increase
would also narrow the gender and minority wage gaps. As cited at the
beginning of my paper, white women who work full time are paid 74 cents
for every dollar men earn whereas women of color are paid only 64 cents
for every dollar men earn (AFL-CIO and IWPR, 1999, pg. 1). Undeniably,
both men and women pay a steep price for unequal pay. One of the explicit
costs is a loss in income. For instance, the 25.6 million women who
work in female dominated occupations lose an average of $3,446 each
per year; the 4 million men who work in predominately female occupations
lose an average of $6,259 (AFL-CIO and IWPR, 1999, pg. 2). Therefore,
one of the explicit costs associated with the wage gap is evidently
financial. One of the implicit costs is related to how women's work
is devalued. When a job is assigned a value, we often forget to ask
who is assigning it and by what criteria? Political economists such
as Ellen Mutari and Deborah Figart would state that the forces of supply
and demand determine wages, yet they are also reflective of gender relations
in society. Caring occupations are seen as natural for women, thus they
do need to be paid a high rate for something that is innate. In order
for wages to transform gender relations, society would have to re-assign
a new value to female dominated occupations. This would have profound
impact in both the market and within the home. The industries that are actively seeking low wage women workers are primarily concentrated in service occupations, retail trade, and agriculture. The proliferation of part-time, low skilled jobs marked by a lack of benefits characterizes much of the work in the retail industry. Our economy has drastically changed since the 1920's, however the acute underpayment and unskilled nature of the jobs is reminiscent of the problem of sweating. The working conditions may be better but the manipulative nature of these industries is chilling. It is by no coincidence that these industries tend to prefer part-time employees because their compensation rates are lower and hours can be increased without paying time-and-one half for overtime (Duggan, 2001). If these industries hired full time employees, they would be obligated to provide time-and-one half to employees that work over forty hours a week under the Fair Labor Standards Act. In addition, employees who work part-time are not entitled health, vacation, and pension benefits that most full-time employees receive. It is evident that many employers are escaping the overtime pay provision guaranteed under the FLSA by strategically hiring part-time employees. They could easily choose to hire more full time workers and less part-time help, however this would be result in higher labor costs. The rapid changes in the economy have not benefited most women. As I have shown, most industries are devising clever strategies to avoid paying decent wages and other vital benefits by seeking part-time help. Along with women's susceptibility in the economy, the current political goals under President Bush's welfare reform are unfavorable to millions of low wage women earners. With the passage of the Personal Responsibility and Work Opportunity Reconciliation Act in 1996, President's Bush's welfare agenda aims to strengthen families and help more welfare recipient's work toward independence and self-reliance (White House, 2002, "Working Toward Independence"). Underneath all the political jargon, this policy seeks to address women's "so called" dependence on welfare. Since 90% of welfare recipients are adult women, women will be largely impacted by the welfare to work initiative under PRWORA. One of the results of PRWORA has been the drastic reduction in welfare caseloads. The NOW Legal Defense and Education Fund cites that between 1996 and March 2001, welfare caseloads fell over 50%, from 12.2 million recipients in 4.4 million families to 5.5 million recipients in 2.1 million families. From these statistics we can see that many women are moving from welfare to work but what is less obvious is what types of jobs they are entering. Women who leave welfare lack the basic skills and education to sustain them in the marketplace (Tally, 2002, pg. 1). Therefore, many of the job opportunities available to former welfare recipients are minimum wage and other low wage work that consistently lack benefits. Now that welfare reform is a reality, complimentary policy decisions such as raising the minimum wage should be a top priority. If self-sufficiency and long-term independence are the goals of welfare reform then more concerted efforts are needed to achieve these objectives. Raising the minimum wage floor is a viable policy option. According to the Center on Budget and Policy Priorities, at least one-third of former welfare recipients in Oregon benefited from a state minimum wage increase (Lazere, 1998, pg. 4). Due to spill over effects, the minimum wage increase also raised the wages of workers who earned slightly above the minimum wage. Therefore, a minimum wage increase would compliment the current welfare reform. Future of the FLSA The Fair Labor Standards Act should also strengthen provisions for live-in domestic workers. Tens of thousands of individuals, mostly women, have come to the United States with special temporary visas to work as live-in migrant domestic workers according to a recent Human Rights Report (Human Rights Watch, 2001). According to the HRW study, these women work long hours with little opportunity to rest and receive compensation significantly less than the minimum wage or even the sub-minimum wage. Many of these women often work an average of 14 hours a day. Under the FLSA, live-in domestic workers are covered by the FLSA minimum wage, but they are excluded from the FLSA's over-time provisions, which require compensation of at least one and one-half times the regular rate for every hour worked over forty hours a week. Some employers who hire domestic live-in migrant workers are unaware that their employees have the right to be paid a minimum wage regardless of their immigrant status. Most employers, however, are firmly aware of the rights, laws, and wages owed to their employees and choose not to abide by them. Clearly, steps need to be taken to ensure that domestic live-in workers are paid the minimum wage and ultimately the FLSA should extend overtime protections to them. From a historical perspective, it is fascinating to examine how the FLSA has protected and excluded certain categories of workers. By looking back at the changes made to the FLSA, the exploitation of live-in domestic migrant workers is better understood. The 1966 and 1974 amendments began the process of bringing farm workers and domestic workers into coverage under the Fair Labor Standards Act. The extended coverage had powerful racial and gendered implications. "For the first time in its history, the law protected almost two-thirds of black workers and almost three-quarters of women workers" (Hart, 1994, pg 170). Undoubtedly, the 1966 and 1974 amendments extended coverage to groups that have been historically exploited for labor. On a less visible level, there will always be a need for cheap, exploitable labor to fill the gaps that the FLSA appears to fill in. Domestic live-in migrant workers, because of their vulnerable legal status represent a new group of easily disposable and exploitable workers for labor purposes. Raising the minimum wage, expanding coverage to administrative occupations, and requiring employers to pay domestic live in workers the minimum wage and over time pay are some areas that should be strengthened under the FLSA. I have tried to point out throughout this paper that while the FLSA guarantees a workers right to be paid fairly, many categories of workers are entirely excluded from the law. It does not stop there. In recent months, Republicans have tried to tack on anti-worker measures to minimum wage bills. Some of these provisions seek to weaken the 40 hour workweek and overtime protections by allowing employers to substitute compensatory time instead of time-and-a half overtime pay ("Anti-Worker Proposals," AFL-CIO)." In our constantly fluctuating economy, many non-exempt employees covered under the Fair Labor Standards Act are working overtime in order to make additional income for their families. Women are often the only wage earners of the household and desperately depend on the income generated from overtime pay. If employers are allowed to offer compensatory time instead of overtime, many minimum wage women workers may be forced to find additional jobs to supplement their incomes. Efforts to weaken the over time provision will make life harder for working class families in America. Conclusion The federal minimum wage is one of the legacies of the FLSA. As I have tried to demonstrate, the minimum wage is a small piece of a complex puzzle. Wages, income inequality, low paid work, occupational segregation, and the feminization of poverty are all symptoms of a larger problem. Wages are not simply determined the by simple interaction of supply and demand. Greed, racial discrimination, sexism, and political ideology all influence the wage setting process and the legislation protecting worker's rights. Female dominated occupations are assigned certain wages based on the natural ability of women to perform such duties. Race, class, and gender hierarchies influence as well as reflect wages. Therefore, it is not by coincidence that certain groups are covered while others are unprotected by the FLSA. It is also not by accident that women and minorities are disproportionately poor, low paid, and significantly affected by any changes in the FLSA. Predictably, the FLSA will be amended to reflect the changing race, class, and gender ideology over the next couple of decades. Raising the minimum wage floor, expanding categories of workers to be covered, and maintaining the overtime provisions under the FLSA should all be supported and carefully guarded. Provisions that seek to undermine these goals should be perceived as a giant leap backward in the fight for race, class, and gender equality. Works Cited AFL-CIO. "Anti-Worker Proposals Likely in Upcoming Minimum Wage Fight." Accessed March 11, 2002. <http://www.aflcio.org/articles/minimum_wage/news.htm> AFL-CIO and IWPR. (1999) "Equal Pay for Working Families: National and State Data on the Pay Gap and Its Costs." A Joint Research Project of the AFL-CIO and the Institute for Women's Policy Research. Washington, D.C.: Published by AFL-CIO and IWPR. Bernstein, Jared, Heidi Hartmann, and John Schmitt. (September 16, 1999) "The Minimum Wage Increase: A Working Woman's Issue." Economic Policy Institute. Issue Brief #133. Accessed March 4, 2002. <http://www.epinet.org/Issuebriefs/Ib133.html> Bernstein, Jared and John Schmitt. (1998) Making Work Pay: The Impact of the 1996-1997 Wage Increase. Washington, D.C: Economic Policy Institute. Cooper, Mary H. (April 17, 1998) "Income Inequality: The Issues." CQ Researcher Volume 8 (15): 337-360. Duggan, Lynn. (September 2001) "Retail on the 'Dole': Parasitic employers and women workers [Part 1 of 3]." NWSA Journal Volume 13 (3). Folbre, Nancy. (2001) The Invisible Heart: Economics and Family Values. New York: The New Press. Hart, Vivien. (1994) Bound By Our Constitution: Women, Workers, and the Minimum Wage. Princeton, New Jersey: Princeton University Press. Human Rights Watch, Women's Rights Division. (June 2001) "Hidden in the Home: Abuse of Domestic Workers with Special Visas in the United States." Volume 13 (2). Accessed April 23, 2002. <http://www.hrw.org/reports/2001/usadom/index.htm#TopOfPage> Lazere, Ed. (1998) "New Findings from Oregon Suggest Minimum Wage Increases Can Boost Wages for Welfare Recipients Moving to Work." Accessed April 13, 2002. <http://www.cbpp.org/529ormw.htm> Tally, M.K. (April 2002) "Job Training and Education Fight Poverty Fact Sheet." Institute for Women's Policy Research. IWPR Publication #D444. Washington, D.C.: IWPR. Kim, Marlene. (September 2000) "Women paid low wages: Who they are and where they work." Monthly Labor Review. Volume 123 (9): 26-30. Levin-Waldman, Oren M. (2001) The Case of the Minimum Wage: Competing Policy Models. Albany, New York: State University of New York Press. Mutari, Ellen. (2000) "The Fair Labor Standards Act of 1938 and Competing Visions of the Living Wage." Review of Radical Political Economics. Volume (32), 3: 408-416. Mutari, Ellen, Deborah M. Figart, and Marilyn Power. (2001) "Implicit Wage Theories in Equal Pay Debates In the United States." Feminist Economics. Volume 7 (2), 23-52. Nordlund, Willis J. (1997) The Quest For A Living Wage: The History of the Federal Minimum Wage Program. Westport, Connecticut: Greenwood Press. Now Legal Defense and Education Fund. "Welfare Reform: After Five Years Is It Working?" Accessed April 1, 2002. <http://www.nowldef.org/html/issues/wel/welfareworking.html> Pollin, Robert and Stephanie Luce. (1998) The Living Wage. New York: The New Press. Works Cited Rassell, Edith, Jared Bernstein and Heather Boushey. (2000) "Step up, not out: The case for raising the federal minimum wage for workers in every state." Issue Brief 149. Washington, D.C.: Economic Policy Institute. The White House. (February 2002) "Working Toward Independence." Accessed March 31, 2002. <http://www.whitehouse.gov/news/releases/2002/02/20020226-11.html> U.S. Department of Labor, Women's Bureau. (March 2000) "20 Facts on Women Workers." Accessed April 23, 2002. <http://www.dol.gov/dol/wb/public/wb_pubs/20fact00.htm>
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