When I entered the workforce as a callow teen, in the summer of 1966, I received my first minimum wage paycheck of roughly fifty dollars as if it was gold-plated. Babysitting had only netted me .75 per hour, so $1.25 represented a huge raise for me.
A quick look at prices in that forgotten era tells me more about the actual value of that $1.25 wage.
A gallon of milk was .99. A gallon of gas was .32. First-class postage cost a nickel, and the average cost of a new house was around $15,000. A brand new car was in the $2,600. range.
1966 was also the year in which, under a federal mandate from the Johnson administration, the University of Wisconsin created its “Institute on Poverty Research.” Just three years later a social conscience was not yet unfashionable, and childhood poverty rates reached their lowest level ever, when only 14% of children lived in poverty. That figure is now at roughly 22%.
In 1966, most qualified students could attend a public university for next to nothing, and even “Ivy League” privates charged only about $3,000. per year.
Just as today, we had an unpopular war in a strange foreign land; but we also were still a manufacturing powerhouse then, and upward mobility was an achievable goal. Our cup was at least half-full.
So what exactly does the new minimum wage for Vermont, at $8.46 per hour (the third highest in the land) puchase in 2012’s economy?
It would buy you a lot more milk than it did in 1966, at an average price of $3.76 per gallon in 2011; but only a little more than two gallons of high-test as opposed to three in ’66. Of course bizarre price-fixing schemes that profit everyone but the small, responsible farmer and the independent gas station account for the relatively low cost of food and fuel in today’s economy.
The more substantial costs of living, like housing, education and transportation tell quite a different story.
A minimum wage earner in 1966 would make, from a 40-hour work-week, an annual salary of $2,600. Nonetheless, the average income in 1966 was $6,900 and significantly more low-wage earners could count on a full forty hours of work every week while union membership and influence was at its strongest.
In 2011 the average income was $26,364. A single year of education at even a mid-tier private college or University costs this much or more. Even at an average public college, the average cost of four years for in-state students comes to more than $30,000.
AAA estimates that the average cost per year to own and operate a car in 2012 is $8,588, a cost that would consume fully half of a Vermont minimum wage earner’s annual salary, even if he or she were so lucky as to work a full 40-hour week.
It’s no wonder that, in communities underserved by public transportation, some Vermonters are forced to choose between a roof over their heads and the car necessary to get them to their minimum wage job.
So, while Vermont’s minimum wage increase is certainly better than a poke in the eye with a sharp stick (or the federal minimum wage of $7.25), and will be welcome to the folks previously locked into $8.15 per hour, it won’t move anyone out of dire poverty.
And you can bet there will be a fair number of crepe-hangers complaining that it disadvantages small businesses and the “job creators” they imagine to be lurking somewhere in the luxury shadows, just waiting for us to tempt them into action.
Regular hikes in the min. wage may be even more needed as the hard/painful/tough budget choices lawmakers often speak about bite even more into programs for retired workers. The Free Press today features a 71 year old man who has worked six years as a custodian to supplement his retirement. He earns $8.50 per hour after starting at $7.25.
http://www.burlingtonfreepress…
Perhaps they mean, by that phrase, that it is ‘exceptional’ that Americans put up with the kind of shit we’ve been getting since Reagan. Or, like a pro-boxer, we can keep taking a beating and still get up again on every 9-count.
I’d like to see a Reality TV show about average Americans called VICTIM instead of Survivor.
“childhood poverty rates reached their lowest level ever, when only 14% of children lived in poverty. That figure is now at roughly 22%.”
i don’t know the figures, but i do know that middle and upper income people have a lot fewer children than 40 years ago. This would account for some of this increase.
but i remember enough anecdotal news stories to know this is true. I remember a story about the declining birth rate in Germany. The comment “Germans want vacations and Porsches instead of children” sticks in my mind.
My point was not to minimize the plight or extent of child poverty. My point is that middle and upper income people do not have as many children as they used to. This skews the average.
I agree that not all poor people are poor because of bad choices. BUT some of them are.