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The Fight for Fair Pay for The Working Poor
Campus Progress
George Warner

February 23, 2011
View the Original Article

In January, the weekend before Martin Luther King Jr. Day, Linda Archer stood in front of a crowd of at least 1,500 people packed inside the Convent Avenue Baptist Church in Harlem.

"I work at a major fast food restaurant in Times Square. I earn $7.25 an hour—without medical coverage—without sick leave," she told the crowd. "And I cannot afford to live on my own with the income that I earn. Right now, I sleep in the living room of a relative's one-bedroom apartment."

For Living Wage NYC, a broad coalition of interfaith and political groups advocating for a higher wages in New York, the night was the culmination of nine months of interfaith organizing. The group brought together citizens from all five New York City boroughs in the hopes of getting the City Council to pass the Fair Wages for New Yorkers Act. The bill mandates $10 an hour. It also requires health insurance benefits or an additional $1.50 an hour health care subsidy for all workers at private companies that receive public subsidies. The principle behind the law is simple, Bronx borough president Ruben Diaz told the crowd: "If [corporate developers] want a public benefit, then [their] project has to benefit the public."

According to Living Wage NYC, New York City provides companies with upwards of $2 billion in subsidies annually to encourage private development.

City politicians, union organizers, pastors, rabbis, imams, and other clergy members spoke that night on the importance of economic justice in the city. The disparity is wide: New York is home to seven of the country’s ten wealthiest city zip codes and three of the ten poorest. Speakers highlighted the civil rights’ economic justice legacy, including the oft-forgotten fact that Martin Luther King Jr. supported sanitation workers on strike for higher wages when he was assassinated in Memphis, Tenn., in 1968.

But nobody spoke more powerfully than Archer about why the Fair Wages for New Yorkers Act should pass.

“I am the working poor,” she said. “My message tonight, is that people like me deserve a living wage because our jobs are important to New York City.”

20 Percent of New Yorkers Live in Poverty

Archer is right. The working class is vital to New York’s economy—as it is all over the country. Without factory workers, retail workers, office cleaners, dishwashers and foodservice workers, New York would not run.

Yet, 30 percent of New Yorkers working full time make less than $30,000 dollars annually, keeping them out of the middle class. Almost 20 percent of New Yorkers live in poverty, compared to 14.3 percent nationally.

The difference between working for New York’s minimum wage, $7.25 an hour, and $10 an hour may not seem like much, but it adds up to another $110 a week that can pay for food, rent, and school supplies.

A $110 per week boost to the working poor could not come at a better time. More and more evidence points to increasing inequality in the city often seen as the nucleus of America’s economy.

Over the last 20 years, the poverty rate has stayed fairly steady while the wealthiest Americans have seen their incomes grow. Amy Traub, director of research at the Drum Major Institute for Public Policy, says that despite the tremendous economic growth of the last few decades, “we can see that low-income New Yorkers, including working New Yorkers, are not sharing in the gains of the economic growth that we have seen in this city. Meanwhile, we have more millionaires than we have ever had in the city’s history.”

But it’s about more than just living expenses or disparities in wealth. It’s about the inability that the working poor have to climb out of poverty. Morenike Dagbo, an activist with Living Wage NYC, works for minimum wage at a supermarket in Staten Island in addition to another job. Dagbo is 26 years old and a City University of New York graduate, and she says when you have to work seven days a week, "it's impossible to aspire to anything else."

Such a day-to-day crunch on so many workers has driven such a broad coalition of unions, community groups, and centers of faith to unite behind the fight for a living wage.

If the is bill passed, New York will not be the first place to make higher wages a reality. Already, fifteen localities, including Detroit, Pittsburgh, Bozeman, St. Paul, Toledo, and Suffolk County, N.Y., have living wage laws that focus on businesses receiving government assistance.

Resistance to Higher Wages Coming From the Mayor’s Office and Corporations

Opponents of the Fair Wages for New Yorkers Act say increasing wages will hinder economic development, and point to the failed development of the Kingsbridge Armory. The armory was slated to be converted into a shopping mall, but The Related Companies, a private corporation which would have received $50 million in tax subsidies for the development, refused to sign a Community Benefits Agreement requiring $10 an hour wages for all employees at the mall. The New York City Council voted 48-1 against allowing the project to move forward, overriding a veto attempt by Mayor Michael Bloomberg.

In September, Bloomberg spoke out against the Fair Wages for New Yorkers Act, saying: “Government should not be in the business of [setting wages].”

Andrew Brent, the Mayor’s Deputy Press Secretary, says that the reason the city subsidizes projects in the first place is because they would not happen without government support. Common reasons for subsidies include development in low-income communities; places with high development costs; or project that support community space in addition to commercial space.

“[Those kinds of projects] are less able to absorb additional cost,” Brent says. Holding them to higher wage standards would make the projects uncompetitive.

But Traub says government should be in the business of making sure tax dollars are being better spent: “It only makes sense to be looking at the $2 billion that the city spends to subsidize private business—and ostensibly spent to create good jobs [and] spur economic growth.” Many of these projects examining are either creating “no jobs at all or these very low wage positions where—yeah, great, somebody goes to work everyday, but their families are still trapped in poverty.”

Opponents of the bill are right that without community action demanding a living wage, the development of Kingsbridge Armory into a mall would have probably gone forward. But the story of the Kingsbridge Armory, what NYC Living Wage calls a “bittersweet victory” for the living wage movement, should not be extrapolated to explain why a citywide living wage mandate hinders development at large. A study done at the Center for American Progress, Campus Progress’ parent organization, found that once a living wage is presumed under law—and not a question for debate like at the Kingsbridge Armory—it has little effect on employment.

Lead author William Lester says the study “dispelled some of the myths” about living wage ordinances. To reach their findings, Lester and his co-author compared economic development in cities from around the country that have living wage ordinances with the economic development of cities that considered wage ordinances, but ended up not implementing them.

In addition to finding that living wage ordinances did not hinder economic development, the study found that the ordinances have a big effect on spending—for every dollar per hour wage increase a person receives, he or she spends another $3200 a year. Lester says other economic research has found that living wage ordinances bolsters local economic, growth because low-wage earners become bigger consumers, and even encouraged employers not covered by the law to raise their wages, which Lester calls an “institutional effect.”

But the Bloomberg Administration contends there is not enough research to know whether a living wage ordinance would affect growth, and has commissioned its own study to gauge how would affect development, hiring a private consulting company, Charles River Associates, in August, 2010. But nine members of the city council—including prominent Living Wage NYC backers like Oliver Koppell—have expressed concernthat the study will reflect the mayor’s own negative position on the bill because it is funded directly by his administration.

City Comptroller John Liu, a supporter of the Fair Wages for New Yorkers Act, was less reserved. “[The city is] squandering a million dollars on this charade of a study," he said.

When it comes to individual workers, the benefits of higher wages are hard to argue with. Dagbo personally saw what higher wages could do for her during the few months she was a U.S. Census worker last year. Dagbo says, "That short time at the Census put me out of debt."

It wasn’t just the $18 per hour she made; Dagbo says "the difference [$10 an hour] will make would be huge." There have been times she could not pay the last $30 of her electric bill, Dagbo says. Reflecting, she remembers times she would think to herself, “If I made 10 dollars, I would have been able to pay this off.”

Touting the evidence that living wage laws encourage economic growth, help families, and are one way of combating society’s growing inequality, the Living Wage NYC campaign continues to push for the bill. In early February, the campaign has called New Yorkers who attended the January meeting, asking them to call their council members to ask for their support. On Feb. 10, the campaign held events for clergy and community leaders to teach them how to plan lobbying meetings for Fair Wages for New Yorkers Act with elected officials.

The Living Wage Act’s Future is Uncertain

Currently, the Fair Wages for New Yorkers Act has 29 sponsors in the city council, Jeff Eichler, a Living Wage NYC campaign organizer, says. Such broad support is a good sign. But Bloomberg is likely to veto the act and overriding that veto would require a veto-proof majority of 34 members.

Right now, though, the battle is to win the support of City Council Speaker Christine Quinn. Quinn—who fashions herself “a champion for working families” in her city council bio—has not opened discussion on the bill and has yet to take a position. She effectively has the sole power to call a vote on the bill, and, for over six months now, has not.

In October, 2010, Quinn killed the Paid Sick Time Act, a measure that would have provided all working New Yorkers at least 5 paid sick days a year, despite a veto-proof majority of the City Council supporting the bill and widespread grassroots support for the measure. When announcing her decision to not call a vote on the measure, Quinn said the bill would cause too much harm to businesses, even though a study of a similar law in San Francisco found it had caused no economic harm.

The question this time around is whether Quinn will listen to the voices of a local grassroots movement, or again market herself to big business. Nobody is saying $10 an hour will solve the problems of the working poor—for sure it is not the $18 Dagbo made while with the Census. But, says Traub, “it’s a step.”