Recommendations

Nowhere in the United States does either the state or federal minimum wage provide a living wage that allows a single adult to support themselves, leaving millions of people struggling to get by. With 43 million people also paying off student loans, which are not included in traditional living wage figures, the minimum wage only falls farther below what is actually needed to make ends meet.

In addition, because barriers still exist which make women and people of color more likely to be paid low wages even with a bachelor’s degree, the impact of the high cost of education and subsequent student loans falls hardest on those already struggling. Ensuring that working families can make ends meet requires a variety of tools, such as:

Increase the federal minimum wage to a living wage. Wages from a full-time job should be enough for at least a single adult to make ends meet. The federal minimum wage (and state minimum wages) should reflect the cost of living, including providing enough for workers to put aside money for emergencies and to save for retirement, and ideally to also pay off debts such as those from student loans.

Eliminate the tipped subminimum wage. Ensuring that all workers are guaranteed one fair wage, rather than having a lower base wage for tipped workers, will help millions of tipped workers out of poverty and put the responsibility on business owners to pay fair wages rather than relying on customers to provide enough in tips.

Reinvest in higher education to remove the need for student loans. Disinvestment in higher education has shifted the burden of paying for college onto students and their families and away from state governments. Reinvesting in higher education can help shift that balance back and make college affordable again so that students and their families can pay for college without falling deep in debt.

Expand tax-free student debt forgiveness. Currently, graduates working full-time for nonprofit organizations, the government, and some other occupations may have their remaining loans forgiven tax-free after 120 on-time payments. Other graduates may have their remaining debt forgiven after 240 payments if they are participating in a low-income repayment plan. However, they must pay taxes on the amount forgiven, which can be a significant financial burden. Tax-free forgiveness should be expanded to include those with lower incomes regardless of occupation.

Establish work supports like paid sick days, and expand eligibility for the Family Medical Leave Act to more businesses and occupations. Paid sick leave is crucial to the well-being of all workers; it provides recovery time from illness rather than forcing employees to come in sick or risk losing their job. For parents with children, the risk of losing that job to take care of a sick child is a heartbreaking dilemma.

Additionally, women without maternity leave are at risk of losing their jobs. For women earning less than a living wage, this can threaten their housing, health, and chance for them and their children to stay out of poverty.

Strengthen and enforce equal opportunity statutes. Systemic barriers and hiring discrimination continue to mean that women and people of color are more likely to earn low wages. Equal opportunity statutes like the Civil Rights Act and affirmative action were designed to help ensure that women and people of color are not discriminated against in the workplace and in other venues, helping give them a fair shot at earning a higher wage as well as preventing other discrimination.

However, enforcement of these policies isn’t consistent, leaving the statutes weak and ineffective. Strengthening and enforcing such statutes can help ensure that they actually benefit women and people of color

Invest in state and federal safety net programs. Even if the minimum wage is increased to a living wage for a single adult, many people including caregivers, parents, those with high medical bills, and others may find that the minimum wage falls short of covering all of their expenses, and will continue to face tough choices. Federal programs like Supplemental Nutrition Assistance Program (SNAP) and the Children’s Health Insurance Program (CHIP) should be fully funded and strengthened. State programs like Earned Income Tax Credits (EITC) and child care subsidies should be bolstered.

Invest in living wage jobs. Rather than investing in low-wage employers, federal, state, and local contracts should be tied to wages to ensure that contracted workers are paid enough to make ends meet. Additionally, subsidies should go to companies that pay workers a living wage, providing incentive for companies to pay their employees enough to support themselves and their families. Businesses that fail to create and retain living wage jobs should face meaningful consequences.