The talk these days is all about the country’s economic doldrums and ways to spur the recovery. The talk is of bailouts for banks, Wall Street and just about every other industry out there. What it all comes down to is jobs, jobs, jobs. The economic recovery will only come, if there is the creation of jobs that have fair wages and good benefits.
It seems some TV talking heads and Republicans believe that the present economic trouble stems from high labor costs and common people striving for home ownership. They declare GM “should” go bankrupt in order to break contracts, jettison “legacy costs” and replace fair wage/benefit jobs with lower wage/no benefit jobs to become more competitive. I’ve heard these folks proclaim that lower wage jobs will benefit the economy and lead to a recovery.
True economic recovery must include employment with fair wages, good benefits and worker confidence if there is any hope of success. It is only with a tide that lifts all boats that an economic recovery and prosperity will come. Economies rely on the success of its citizens, all of its citizens, to grow and prosper. Corporate profits alone will not lead this country back to success and growth. It would be good to remember consumer spending accounts for 2/3rds of our economy. When fair wage jobs are plentiful, people spend and save, the general economy flourishes and corporate profits rise.
Over the past three decades, there has been a move to replace fair wage jobs with lower wage and minimum wage jobs. This push to reward ownership over labor has driven a growing wage disparity between company top executives and the workers making the products. Executive Pay Database reported the average 2007 annual compensation for S&P 500 CEOs was $14,200,000/year or $273,076/week. As of September 2008, the Bureau of Labor Statistics reported the average income for workers was $31,893/year or $613/week. The average CEO makes 445 times the income of the average worker, up from 42 times in 1980.
By comparison, the federal minimum wage is presently $6.55/hr. A 40 hour work week would yield $262/week or $13,624/year. The US Census Bureau considers annual income of $9,000 for individuals and $18,000 for a family of four as the poverty level. The country can not and will not succeed, if jobs once paying $30,000 or $40,000 a year are replaced with minimum wage jobs.
The argument against fair wages states that our companies cannot compete with companies with lower wage employment. However, lower worker wages do not necessarily translate into higher corporate profits and improved shareholder value. Lower paid workers are found to be less committed to corporate success, have lower productivity, higher turnover and higher over all employment costs (health, absenteeism).
We will not survive as a nation, if we allow for the continued destruction of the working class. It would detrimental to our nation to push aside and forget the workers who dedicate their lives to the success of their companies. We can ill afford a minimum wage, zero benefit work force economy with only the top executives and shareholders becoming wealthy. After all, workers are the key to any business’ success.
Government investment needs to focus on infrastructure, new technologies, clean energy, and manufacturing to produce jobs for workers here at home. The only way for the nation to recover from this economic downturn is by creating opportunities for businesses to increase jobs with fair wages and benefits for all workers.