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April 19, 2014

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Living off minimum wage is barely living

WEST PALM BEACH, Fla. — “So what’s for dinner tonight?” I asked.

“I’m looking at that box of cereal again,” said state Sen. Dwight Bullard, D-Miami, who was seeing what it was like last week to live on the minimum wage.

The South Florida legislator calculated that he had $52.62 at his disposal for food, transportation and entertainment for the week. And by Thursday night, that meant eating a bowl of Honey Nut Cheerios for supper.

“I’ve been completely taken back by all the little things I’ve had to give up,” he said. “I’m used to stopping by Starbucks once a week for a cup of coffee and a piece of banana bread. I can’t afford that now.”

And he can’t afford to drive his car very much, either. In the week prior to his experiment, he spent $62 to gas up his vehicle. That alone would bust his weekly budget. So he has been resorting to bumming rides with friends and taking public transportation.

“I get to attend some functions that have food at them, so I get to eat there,” he said. “People say, ‘Hey, why are you eating so much?’”

There was a time, some 40 years ago, when a single parent earning the minimum wage was actually above the poverty line. But that wage has long stopped keeping pace with inflation. If it had, the floor for wages today would be about $10 an hour.

Instead, the federal minimum wage is $7.25 an hour, a figure than hasn’t been raised in four years. Nineteen states, including Florida, have set minimum wages that are higher than the federal level. Florida’s minimum wage is $7.79 an hour, which translates to $16,208 in annual income.

But it’s basically just a wage earned by part-time-working teenagers, right? And raising it will only create more unemployment as employers find a way to hire fewer workers, business groups argue.

Those arguments have helped keep the minimum wage artificially low, despite a call by President Barack Obama to raise it to $9 an hour and a stalled bill in Congress called the Fair Minimum Wage Act of 2013 that would raise the rate to $10.10 an hour.

“There’s been a lot of misconceptions about the minimum wage,” said David Cooper, an analyst with the Economic Policy Institute, a nonpartisan think tank based in Washington. “A good portion of those affected are teenagers, but it also affects a good portion of older people with families.”

The federal numbers report only those who make the exact amount of the minimum wage, Cooper said, but there are millions of other people who make just slightly more than that wage, and many of those are at least 20 years old and/or parents of young children.

A family budget calculator created by the EPI estimates that a single parent trying to raise one child in Palm Beach County needs to make $51,593 a year in order to achieve a “secure yet modest living standard.”

This calculation includes spending $1,183 a month on housing, $943 on health care and $480 on transportation.

By contrast, McDonald’s provided budgeting guidance to its employees last week, showing them how making a monthly budget could help them get by on their minimum-wage jobs.

The McDonald’s employee budget put monthly health care costs at $20 and didn’t budget any money for food, clothing, transportation or child care.

And to make the numbers work, the McDonald’s budget also assumed that its workers would also be toiling at a second job that earned them nearly as much as their McDonald’s job.

That sounds like a roundabout way of acknowledging that a person can’t survive on a minimum-wage job.

It’s something Bullard has been finding out all week.

“I think all my colleagues need to try it,” he said. “It’s been an eye-opening experience.”

Frank Cerabino writes for the Palm Beach Post.

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