The living wage is an idea that is at the heart of a new political strategy to raise real wages in the United States. It is focused on those workers who have been left behind in the economic boom of the 1990s. The sales, clerical, operative, and service jobs in the service-producing economy have had stagnant or falling wages. These jobs are often filled by a predominantly female and disproportionately minority work force.
In many metropolitan areas, trade unions and their allies are working to get living wage ordinances passed. The living wage movement has grown out of recent trade union organizing and welfare reform resistance movements. Generally, these groups argue that there is a "wage gap" between the wages typically paid to semiskilled and unskilled workers in a service-based economy and the basic--self-sufficient or unsubsidized--income required to provide for a family.
There are, at least, three political reasons for the appearance of the living wage campaigns. First, real wages and salaries for many workers have been stagnant as real per capita income has risen. Second, many municipalities are outsourcing work done in the past by civil servants. The wages paid by private contractors are usually perceived to be lower and the benefit packages weaker than that which would have been provided by the metropolitan government. Third, service sector wages are perceived to be low relative to factory jobs. The living wage movement is part of a general effort to boost the income that comes from service-producing employment.
The living wage is usually defined as a self-sufficiency income, i.e., the level of income necessary for a given family type to become independent of welfare or other public subsidies. The political campaign for a living wage emphasizes passing local ordinances that call for a certain minimum hourly wage plus a reasonable benefit package. That living wage is supposed to be paid by the municipality's agencies, plus the city is supposed to only contract with private firms that pay a living wage. The idea is to start a "cluster" of better paying jobs in the service economy, so that either individual firms or the marketplace as a whole will follow the initial thrust.
The Family Wage
The living wage campaign harkens back to the family wage campaign in the earlier part of this century. Generally speaking, the family wage was a proposal by trade unionists that the wage should not be determined by the "market rate or the standard wage." Instead, the family wage was supposed to cover the social reproduction of the worker's family. A wage should pay not only for the work--a spot market price--but also for the costs of running a household, paying for health care, and raising children. The family wage--while still today probably widely accepted as a standard for work--was never accepted in practice by U.S. industry.
In 1923, Alice Henry, secretary of the National Women's Trade Union League, noted:
This is known as the family wage, family allowances or endowment of motherhood, and is closely related to maternity insurance or mothers' pensions. The essential principle is the payment to the worker or the worker's wife, of a sum for the maintenance of the children, in proportion to the number in the family [Henry 1923, 156].
However, some industrial trade unionists and most feminists have viewed the family wage as inherently negative toward women in the workplace. The family wage ideology was seen as being part of a belief system that women should be protected if they worked in paid employment and that, generally, women should only work in the home.
Feminist labor historian Nancy F. Gabin notes:
The increasing significance of employment for married women, evident in the working class before it was apparent in the middle class, undermined the family-wage ideology and asserted female economic independence, at least insofar …