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Other articles in Part 2 The best and worst of times Why are some people unable to earn a living? Poverty research Education plays key role in poverty Do the poor pay taxes? Graph: Full- time minimum wage falls below poverty line Related links Is this really a living wage? by Northwest Policy Center Is this really a living wage? by Northwest Federation of Community Organizations Center on Budget and Policy Priorities

Minimum wage fails to keep up story by Andrea Daily Most stories of poverty focus on the players--the people who are poor. We hear a lot less about how laws and policies set the stage on which poverty plays out. Minimum wage laws are a prime example. Massachusetts passed the first minimum wage law in 1912. Oregon's passed a year later. These laws were aimed mainly at sweatshops where women and children toiled for pennies a day. The philosophy and coverage of minimum wage laws gradually evolved so that, by the 1950s, most laws reflected the idea that all workers should be paid a fair wage. If "fair" means "not poor, technically speaking," then for a time the laws succeeded in their aim. For example, as the graph below shows, during the late 1960s and most of the 1970s one adult Oregonian working full time at minimum wage could support himself or herself and two dependents with income a little above poverty level. For most of the past 20 years, however, minimum-wage earners steadily lost ground. In Oregon, it's only since 1996, when the latest round of minimum-wage increases began, that those at the lowest end of the wage scale have seen their real earnings improve. Even so, the sole provider earning minimum wage in a three-person family in Oregon today is $360 a year below the poverty line. In a four-person family, that income would fall $3,180 below the line--despite the fact that Oregon's minimum wage, $6.50 an hour, is second highest in the country. Few Oregon workers-about 4 percent-earned less than minimum wage in the first quarter of 1999, according to the Oregon Center for Public Policy. About 9 percent earned from $6.50 to $6.99 an hour. The inadequacy of minimum-wage levels is prompting an increasing number of city and county governments, including Multnomah County and the City of Portland, to set "living wage" requirements for employers who contract with them. In the case of Multnomah County, janitorial and security-service contractors must pay their employees a combined wage and benefit package of $9 an hour and must give cost-of-living increases annually. But is that really a "living wage"? No, it's not, according to a 1999 study by the Northwest Policy Center and the Northwest Federation of Community Organizations. In a higher-cost area of Oregon like Multnomah County, the living wage for a single adult is $10.36 an hour, the study says. For a family of four in which one adult works outside the home, it's $14.34 an hour. In lower-cost areas such as the eastern counties, the living wage for a single adult is $9.45 an hour. For the sole provider in a family of four, it's $13.32. Living-wage levels were calculated (in 1996 dollars) to include some allowance for savings, taxes, child care, and health care as well as for food, clothing, shelter, and transportation. The calculations provide only a modest standard of living. For example, housing for a single adult and two children is assumed to be a two-bedroom apartment priced in the lower half of the rental scale. The food allowance is pegged to the federal government's "Low Cost Food Plan." About half of all job openings pay less than the "living wage" for a single adult, the study found. Fewer than one-quarter of job openings pay the living wage for an adult supporting two children.   Article 5 of 7 in Part 2   back to top

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