ECONOMIC DEVELOPMENT AND THE LIVING WAGE
By TERRY WERNER
There has been a lot of talk about economic development in the past couple of years, as well there should be. The Mayor’s race was about jobs. The Chamber of Commerce has renewed its efforts with organizational changes and a new strategic plan for economic development, the Angelou Report. The City Council recently debated the Mayor’s Infrastructure Financing Plan, the largest tax and fee increase in Lincoln’s history, to build infrastructure which in turn would theoretically bring in more jobs.
I believe it will take a variety of methods to promote economic development in Lincoln. It will take all segments of our city working together as a team, moving in the same direction. This must include small and large business, the City, the County, LES, the University and labor. We are all in this together to do what is best for Lincoln.
However, I have little faith in the ‘trickle down’ theory of economic development. Tax cuts to the wealthy and incentives to big business has done little for the working people in our country. If we are going to talk about the different economic needs in our community, surely a very basic one would be jobs that pay a ‘living wage’, one based upon the true cost of living in a community. True economic development cannot happen without it.
This past June was the 65th Anniversary of the minimum wage. The current minimum wage of $5.15 an hour is lower than the real dollar minimum wage of 1950, $5.71 an hour. (* Holly Sklar, Raising the Floor) Clearly the past decade of prosperity has not reached the working folks in our country. Many in our community are required to work two and sometimes three jobs just to maintain a household. If we care about economic development then it must be one that provides working people with the dignity to support themselves and their families. People who work hard should not be poor.
I believe that government is not here to support the rich and powerful, (they do just fine on their own), but to aid and assist people with their basic needs. When workers are underpaid and on welfare, our community is simply subsidizing the employers, the stockholders and the consumer. I believe that minimum wage must be raised to the real dollar level of 1968 in our city, state and nation. A living wage in Lincoln, Nebraska would be anywhere from $10.00 to $13.00 an hour, depending upon whether health insurance is provided.
Passing an ordinance in Lincoln that would require every employer to pay a living wage might be an insurmountable task. However, I do believe that sound economic policy would suggest that the City require those with whom we contract to pay a living wage. The City should not subsidize those who receive contracts and assistance from Lincoln taxpayers.
I intend to introduce an ordinance to the City Council that will be called the "Living Wage Ordinance". It will state the following objectives; ’the expenditures of public money are intended to serve a public purpose by creating good paying jobs’; ’promote the creation of jobs that allow citizens to support themselves and their families with dignity’; ’sub-poverty level wages do not serve the public purpose and place an undue burden on taxpayers and the community which must further subsidize employers who pay sub-poverty wages by providing their employees health care, housing, nutrition, energy assistance and other government provided services’. ’The City therefore has a responsibility when spending public money to set a community standard that permits workers employed through such public funding to live above at least the federal poverty guideline, and to move towards living wage employment'.
Essentially the ordinance will require those entities which contract or receive financial assistance of $25,000.00 or greater to pay a ’living wage’. The hourly wage shall be calculated at 110% of the federal poverty guideline for a family of four. If health insurance is provided, then it will be at 100% of the poverty guideline. Of course, there will be exceptions for part-time summer employment and for companies with fewer than 10 employees. You will also note that this is not even a true living wage for Lincoln. Under this formula the wage would be $8.85 an hour with health insurance and $9.73 an hour without.
There are many more details and I would be happy to answer questions. There are also details to be worked out with City staff on the implementation. I strongly believe in this and am asking for your support. Please watch for public hearing dates and come down to testify. Please contact your City Council Representatives and the Mayor. Together we can do this for Lincoln’s economic vitality.