Think of the United States and, soon enough, you’ll probably think of fast food. There are a lot of chains to choose from, but you’ll possibly think of that most ubiquitous symbol of globalisation: McDonalds. The company celebrated the sixtieth anniversary of the opening of its first franchise on Wednesday, the same day that many fast-food and other low-paid workers across the US went on strike, calling for a $15-an-hour minimum wage.
In the US, low-paid workers have increasingly sought in recent years to take a stand against their wages. The federal minimum wage currently stands at $7.25 an hour (though some cities have their own minimum wages too). That’s equivalent to around £4.90 an hour; the current over-21 minimum wage in the UK, by contrast, is £6.50. For decades, wages have stagnated in the US, as it has increasingly become a post-industrial, service-sector economy. Workers in fast food, retail, cleaning, hotel and care work, in particular, have increasingly found that their wages simply don’t pay enough to live off. Tired of their poverty pay, they have organised and campaigned. From a strike by a two hundred fast-food workers in New York in 2012, a movement has grown which encompasses low-wage workers in multiple sectors, with Wednesday’s protests reaching across the country.
The writer Barbara Ehrenreich, in 2001, set out to undertake minimum wage work in these sectors, and wrote a book, Nickel and Dimed, in which she described the hardships that low-wage work brought with it. She detailed the long hours, difficult financial decisions, and frequently physically demanding labour that she and those around her faced. And Ehrenreich was ultimately lucky: she could leave the jobs and return to her career as a writer. Yet the realities which she depicted remain largely the same today, some fourteen years later. A video by The Guardian this week followed several workers, working multiple jobs at long hours, and still struggling to provide for their families. All were women. The disproportionate impact of low wages on women has continued from the days of Ehrenreich’s investigations: today, some three-quarters of minimum-wage workers in the US are women. The persistence of low pay is racialised, as well as gendered; in 2013, the median household income of a non-white household was $33,500, compared to $55,800 for white households.
An article for Salon by one McDonalds employee further emphasised the harsh realities of low-wage work, and the toll that it takes on workers, who have to consistently live with financial worries. (The author was brave to write the piece; earlier this month, a hotel worker from Arkansas was reportedly fired after speaking to a journalist, although her manager has disputed this.) As well as exerting considerable pressure on the workers themselves, low pay also has an impact on American state and federal finances. A report this week by the Berkeley Labor Center estimates that between 2009 and 2011 the federal government spent $127.8 billion a year on programmes which help low-paid workers, including the Earned Income Tax Credit, Medicaid, and Food Stamps. The 50 states, combined, spent some $25 billion a year on programmes to support workers on low wages. In other words, taxpayers are spending over $150 billion a year to help workers whose employers do not pay them enough to live off. 56% of federal and state spending on public assistance in the US goes to working families (rendering the age-old trope of the poor as ‘lazy’ as utterly inaccurate, not to mention highly offensive).
There is some sign, though, that the efforts of the Fight for 15 movement are having an effect. Several cities, including Chicago and Seattle, have taken steps to begin increasing their minimum wages. Employers, too, have begun to take action: Wal-Mart and TJ Maxx both announced wage increases earlier this year, and McDonalds has recently done so as well (though these only apply to the restaurants it owns itself, and not the franchises which employ the majority of its US workers). President Obama has called for the federal minimum wage to rise to over $10 an hour, a considerable increase, although far below $15; and he’s had no success yet.
More than this, it is possible that the issue of low pay and inequality will come to be a major one in the 2016 election. Hillary Clinton’s announcement video made reference to inequality as a major problem, and it is, as Salon’s Katie McDonough points out, a subject likely to affect all candidates. As Noam Scheiber wrote for the New York Times this week, public opinion seems to be turning, with the Fight for 15 movement generating increased awareness and concern about inequality and low pay amongst voters.
This is an issue which extends beyond the US as well: Britain has similarly experienced the same broad trends of the growth of service-sector, low-paid jobs over the past decades. In the British general election too, themes of inequality, minimum-wage work, and zero-hours contracts have been present. Ed Miliband in particular has sought to emphasize these issues, and the rhetoric of the Labour and Democratic parties seems to bear more than a passing resemblance. Given Miliband’s time spent in the US, and the links which the previous Labour government had with the Clinton administration during the 1990s, this is unsurprising. Yet what politicians on both sides of the Atlantic ought to bear in mind is that this is a long-term problem, even if the 2008 crisis and subsequent recession has thrown it into sharper relief. It is also a problem which, ultimately, requires making decisions on fundamental questions shared by both economies. Should wages pay enough to live off? Whose task is it to ensure that workers earn enough to get by; employers, the state, or both?