PHIL REISMAN

Phil Reisman: What's a Lower Hudson living wage?

Phil Reisman
preisman@lohud.com
Phil Reisman

One summer long ago I took a night job in a factory.

It was hot, monotonous work that entailed mixing paint chemicals in a graduated cylinder and then pouring the toxic cocktail into a reservoir attached to a spray jet that coated plastic pieces on a conveyor belt.

For a middle-class teenager this was a temporary "character building" job with a punch clock.

I don't recall the pay, but it couldn't have been much more than $1.85 an hour, the New York minimum wage then. Adjusted for inflation that's equivalent to $9.86 in purchasing power today, which is actually $1.11 more than the state's current minimum wage.

At any rate, clearing $100 for a week's work required putting in overtime hours, which was essential and yet, strangely, considered at best a benign form of theft by the bosses who wore white lab coats and carried clipboards.

I saved my money to buy college textbooks, never thinking for a moment that the other factory workers needed every penny of their paychecks just to put food on the table. Many of them juggled second and third jobs.

That was 1973, a benchmark year that is frequently cited in the ongoing debate over income inequality, stagnating pay and the supposed decline of the American middle class. Indeed, President Obama's recently released 2015 Economic Report marked that year as the end of "The Age of Shared Growth" and the beginning of a new era when wealth began to disproportionately shift to the highest earners.

Lately, there's been a flurry of positive news about worker wages — most notably Wal-Mart's announcement that it would immediately raise its employee pay $1.75 above the national minimum wage to $9 an hour and to at least $10 next year.

Wal-Mart's move has been attributed to rosier unemployment numbers, which have enabled workers to be choosier in their search for greener pastures. To remain competitive in an improving economy, the nation's largest employer, with a workforce of 1.4 million here and 2.2 million worldwide, was all but compelled to increase worker pay. Free marketers say this is the way it ought to be — a decision driven by natural economic forces.

Wal-Mart critics, who blame the giant chain and other mega-retailers for a number of societal ills, including the decline of the middle class, also welcomed the pay increase but with fainter praise.

One of those critics is Stacey Mitchell, an expert on retail development who wrote the 2006 book "Big-Box Swindle," a scathing indictment of Wal-Mart's corporate practices.

"It's interesting they made the announcement in such a big media-oriented way, and I think that's a sign they know they have to answer to workers who are saying, 'We don't make enough,' " she said.

"That said," she added, "it's still obviously not enough."

Nevertheless, when Wal-Mart speaks, people listen. On Wednesday, three other national retailers — TJ Maxx, Marshalls and Home Goods — announced they, too, would raise worker pay to at least $9 an hour. Perhaps a little bit lost in the recent shuffle is the big-box furniture chain Ikea, which last summer announced its intention to raise worker pay 17 percent to $10.76 an hour.

You don't have to hold a Ph.D. in economics to see how this could be the start to a good thing. Seventy percent of the economy is consumer driven, so the more money people have in their pockets the more stuff they buy. Henry Ford knew this 100 years ago — and he was no socialist.

On another front, Gov. Andrew Cuomo wants to raise New York's minimum wage of $8.75 to $11.50 in New York City and $10.50 for everyone else in the state.

An argument could be made that Cuomo's proposed increases fall short and that the two-tiered wage system fails to take into account the suburban counties outside the city, where the cost of living is through the roof.

There is an online tool called the Living Wage Calculator developed by Amy Glasmeirer, an MIT economics professor, that analyzes regional costs of food, health care, housing and other data in every county and in every state in the union. The numbers vary widely.

According to the calculator, a suitable minimum wage for a single adult without children in ultra-expensive Westchester would be $13.05 an hour, or 30 cents higher than Manhattan. The calculator pegs Rockland and Putnam to be equivalent to the city at $12.75.

Glasmeirer told me that the calculator, which has been updated since its inception in 2004, wasn't designed for somebody hoping to aspire to the middle class, "but somebody who was just getting by."

The calculator can be used as a negotiating tool.

In fact, Ikea reportedly consulted it when it raised the pay for its lowest wage earners. One motivation was increasing worker loyalty.

Loyalty. What a radical idea.

Email: preisman@lohud.com. Twitter: @philreisman