From George Fish:
In 1967 I worked a full-time job in a fast-food restaurant in Michigan; because this restaurant was unionized, under collective bargaining with HERE, the Hotel Employees and Restaurant Employees, AFL-CIO, I received an hourly wage of $1.60, 20ȼ, or 14.29%, more than the 1967 federal minimum wage of $1.40 an hour. Today, mid-2013, I am working in a warehouse in Indiana through a temp service for $9.00 an hour; that means, in real terms, I am making less than I made in 1967, both in terms of the minimum wage, and my wage of 20ȼ over the minimum wage. In this, I am but a typical Hoosier worker.
The Bureau of Labor Statistics (BLS) of the U.S. Department of Labor provides a most useful table for calculating real wages in terms of past income, its historical table of all the changes in the calculation of the monthly Consumer Price Index (CPI) from 1913 to the present, holding the average of the years 1982-1984 as the benchmark of 100; it’s at ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt. [To access this link, one may have to go first to http://www.bls.gov/cpi/#tables.] With a 1967 yearly average CPI of 33.4, and a current (June 2013) CPI standing at 233.504, we can calculate that it would take a wage of $9.78 an hour to have the same purchasing power of the 1967 minimum wage of $1.40 per hour, and it would take a wage of $11.11 an hour to equal the purchasing power of my then-earned $1.60 an hour. Or, I would have to earn 78ȼ an hour more just to have the purchasing power of the 1967 minimum wage, and $2.11 more in order to have the purchasing power of my then $1.60 per hour. A good measure of just how much, not only I, but many other workers, have lost in the interim! An interim characterized ever since the 1970s by stagnant wage rates, only sporadic increases in the minimum wage, and continuing inflation: in real terms, workers have lost purchasing power, and the economy has been sheltered from the full effect of this loss only by more and more people relying on credit: credit cards, loans, and cashing in on housing equity before the housing bubble burst and brought on the current recession. All this while CEO pay has jumped to 354% of the average worker’s pay, the largest such gap in the world (even greater than China’s), according to the AFL-CIO
[http://www.aflcio.org/Press-Room/Press-Releases/U.S.-CEOs-Paid-354-Times-the-Average-Rank-and-File-Worker-Largest-Pay-Gap-in-the-World]; and the massively increased productivity gains since the 1960s have almost entirely gone to the already very rich, the famed 1% that Occupy movements brought to the public’s attention.
Here in Indiana we have an especially able measure of workers’ loss and even descent, in many cases, into the working poor. That’s because the state government agency, the Council for Economic Development, calculated and determined that a “livable wage” in the State of Indiana in 2001 would need to be at least $10.00 an hour for a single person. Since Indiana’s cost of living is approximately equal to the national average, and Indiana’s “livable wage” is equivalent to the notion of the Living Wage that has been employed both by economists and economic activists, and which is set to be 130% of a poverty wage, we can use the data above provided by the BLS to calculate just what would constitute a Living Wage and a poverty wage that would have general validity across the U.S. From this data we can see that a Living Wage in June 2013 would have to be $13.18 in order to have the same purchasing power of the $10.00 an hour “livable wage” of 2001. This would make a poverty wage $10.13 an hour or less. But Indiana’s economic shift from a manufacturing hub, with its concomitant loss of good-paying, frequently union, jobs [Indiana lost 200,000 jobs in manufacturing alone from the late 1970s to 2010. Building Indiana, August 27, 2010, “Study Details Indiana’s Manufacturing Industry,” http://buildingindianablog.com/2010/08/27/study-details-indianas-manufacturing-industry/; this doesn’t include job losses in other sectors.], and its transformation into a “logistics economy” of warehouses (due to Indiana’s central location and access to airports, railways and interstate highways) [on the “logistics economy” see Gregory Travis, “Indiana's warehouse economy—revisited,” Bloomington Alternative, October 19, 2008, http://bloomingtonalternative.com/articles/2008/10/19/9782; the “logistics economy” has greatly expanded since then.] and low-wage service industries, means that a typical Hoosier wage now is only $9.00-$10.00 an hour, and in retail and food services even less. (Here in Central Indiana where I live, warehouse employment, often only or primarily through temp agencies, is ubiquitous and pays only $9.00-$10.00 per hour.) What that means is that numerous Hoosier workers are in fact toiling for poverty-level wages. $9.00 an hour is only 88.45% of the upper-bound poverty wage of $10.13, and even $10.00 an hour is still only 98.717% of this wage. In terms of a Living Wage it’s even worse: $9.00 an hour is only 68.29% of the $13.18 per hour Living Wage rate, and $10.00 an hour is only 75.87% of it.
For those making even less, a large number of Hoosier workers, the situation is even worse—and to top it off, the inadequate federal “poverty guideline” of $1,211 per month for food stamps for a single person such as myself, and the state “income standard” of only $710 for a single person to qualify for Medicaid without out-of-pocket costs, or “spend-down,” means many working Hoosiers, though in poverty, are still too “rich” for welfare! In fact, if one works a full-time job at the minimum wage of $7.25 an hour, one makes too much to qualify for food stamps. Thus are the poor double-whammied: first by inadequate income, second, by being too “rich” for needed welfare benefits.
The response of the two houses of Indiana’s legislature, the Indiana General Assembly, both Republican/Tea Party-dominated, and Indiana’s last two Republican Governors, Mitch Daniels and Mike Pence, who’ve controlled the Governorship since 2004, has been only to attack working people and the poor for “greed”: Indiana became a right-to-work state in 2012; the previous year it reduced unemployment benefits by 25% and capped them at only $360 per week (or the full-time job equivalent of $9.00 an hour; but only high wage earners would qualify even for this amount!); further, under present Governor Pence, setting up insurance exchanges and expanding Medicaid coverage to those who make 133% of the federal poverty level under Obamacare, even though federal assistance would be provided, have been refused. Indiana’s poverty rate averaged 14.1% from 2007-2011 under inadequate federal guidelines under inadequate federal guidelines, up from 10.6% in 2006 (data from U.S. Census) and its economic well-being marred by drops in per capita income. (Indiana ‘s per capita income dropped steadily from 2005-2009, and has only risen 1.4% in the last ten years. Indiana ranks 40th nationwide in per capita income; its per capita income in 2012 was only 86.4% of that for the U.S. as a whole, down from 90.6% in 2002. (STATS Indiana, provided by the Business Research Center of the Kelly School of Business, Indiana University, http://www.stats.indiana.edu/sip/inc/inc2_18.html; also, U.S. Census data, coverage in the Indianapolis Star.)
Such is work and wages in Indiana, where Hoosier workers make only 86ȼ for every dollar in wages paid elsewhere (stated by an organizer with Justice for Janitors, SEIU Local 1).