6-30-2001
Have you tried a living wage lately?
By Zoltan Szigethy

The Kitsap Regional Economic Development Council (KREDC) is committed to attract and retain primary jobs paying a living wage. What, pray tell, is a “living” wage? What bare necessities are presumed? What level of comfort does this imply?

My European parents made do during my early years by finding rushes to make brooms, using needle and thread to sew shoes, picking berries in the woods, sorrel and nettles in the fields, and bartering their linguistic skills to keep us alive. It can be said they earned a living wage, since we did remain alive. Compared to the living misery of millions, we were well off.

In today’s America, median income is often used as the standard for comparison; not the average, but the midpoint of all incomes. Should the KREDC turn up its nose at a potential employer because the proposed level of compensation doesn’t match benchmarks of median family income, or eighty percent of it, or fifty percent, or thirty? Let us cut to the chase.

The cited income levels are guidelines used to establish eligibility for public programs. They imply decreasing gradations of comfort, with poverty supposedly falling somewhere between fifty and thirty percent of median income. Assume for a moment that your current income is the median. Then eliminate seventy percent of it and consider whether living off the remainder doesn’t invigorate you and make you feel alive!

The necessity and urgency of making do with that thirty percent residual would be a more potent stimulant than any $2.80 double shot espresso costing over half of the $5.15 hourly federal minimum wage. Our state’s progressiveness of a $6.72 minimum wage still leaves it out of reach for many. If you were earning the federal minimum wage, that daily espresso would cost nearly seven percent of your annual income; the per cup equivalent of $13 if you are earning, say, $50,000 annually. What a rush!

What, then, is a living wage? It’s an intriguing question for those with disposable income sufficient to pay for more than life’s necessities. It’s less academic for others who are struggling to simply subsist. The issue is complex, to be sure. Necessities tend to accrete. They evolve to include running water, electricity, phone, car, dry cleaning and per capita living space offering some privacy. Poverty has always been a relative concept, but that does not lessen the deprivation of the poor at any given point in time.

It remains problematic when addressed in absolute terms. Even our national definition of poverty is suspect, for it is based on an outdated multiplier of food costs and thereby results in a contested poverty income figure around $17,650. Some experts argue that the absolute poverty line for a family of four should be drawn around $25,000 annually, but their argument is expediently discarded. No national administration dares to update the calculation, for it would result in a politically potent increase in the number of people considered to be poor.

The bottom line is pretty simple, for in real life choices are relative, not absolute. If people are looking for work paying $X because they currently earn less, then $X is a more desirable living wage. Just because $X is less than you earn does not make it irrelevant to others. To the contrary, it helps bring them closer to your standard of living because it elevates their current status.

Let’s take an example. The median income for a family of four in Kitsap County is approximately $43,500. The KREDC, after a long courtship, convinced Nextel Communications to open a call center and provide 500 new jobs. About ninety percent of these positions will be customer service representatives, with a starting wage of ten dollars per hour, or $20,800 per year. Nextel provides accompanying personnel benefits, but the entry level income is clearly less than the median family income. This begins to explain why we have two wage earners in many households, but what if you are a single parent? While $20,800 is certainly not the thirty percent income level we imagined above, it is close to the fifty percent level.

Did the KREDC sell out the interests of our workforce by spending so much energy to attract this employer? The evidence suggests not. After all, if there is no need for upward mobility, there should be no applicants. It is unlikely for applicants to seek jobs lowering their standard of living.

As a matter of fact, the initial round of applicants numbered about 800 over three weeks without any special advertising. About seventy percent of them passed the threshold requirements for employment to move into a second round of qualifying examinations, which speaks well for the quality of our labor force. Nextel will begin with a cadre of 75 to 100 employees when it opens its doors in July, and will add about 50 more every three weeks thereafter to reach its full complement. The fact that applicants come from all over this peninsula bears witness that none of our local communities are bereft of families benefiting from Nextel’s presence.

Some candidates are entering work for the first time or are re-entering the workforce after some absence, but there clearly are quite a lot of “shoe-makers and broom-makers” in Kitsap County who currently make some sort of living wage, yet welcome the chance to improve their lot. As long as this is the case, the KREDC has not only brought new wealth into our economy, helped to diversify jobs, and set the stage for other employers to call Kitsap their home, but it has raised the bar for what defines a living wage in the lives of many of our fellow citizens. Now, that’s a rush!

(Editor’s Note: Zoltan Szigethy is Executive Director of the Kitsap Regional Economic Development Council. This is the fourth article of a series on the KREDC.).