Struggling American Families: The Urgent Need for Higher Wages

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According to Jason Rahlan, the VP of corporate responsibility and sustainability for Dayforce, employers have an easy fix for the problem: raising wages.

According to a new joint report from Dayforce and the Living Wage Corporation, 44% of American full-time employees do not make enough money to cover their family’s basic needs.

The report utilized data from 600,000 full-time employees, which was run through MIT’s Living Wage calculator. The recommended living wage in America is context-specific; it varies based on location and cost of living. For example, the living wage in Sacramento County, California, for a couple with two children, is $31.43, while the living wage in Marshall County, Kansas, with the same parameters, is $22.46.

In her 16 years working at Cornell University, Gopini Lama has only seen a total of $4.40 in raises. Prices have gone up. The productivity of workers has gone up. Congresspeople’s salaries have gone up. Yet, for low-wage workers’ their income has remained the same. This is morally wrong. Without a living wage, voting rights, or healthcare for all, you get an impoverished democracy.

Recently, Kavya Vaghul, the co-founder and chief product officer of the Living Wage Institute, told Fortune, “This report should be a wake-up call. It tracks really closely with what we hear the American public is experiencing when it comes to the inflationary environment. You have prices skyrocketing on basic goods and services, and as a result of that, many people are not able to meet basic needs.

She went on to discuss the impact of the economic climate on women. “When it comes to women, there are several factors that drive the report’s findings, and they’re all connected to a pernicious history of societal biases as well as discriminatory and unequal labor market policies that are continuing to contribute to the disparities that we see by gender.”

Black and Latino workers also face inequality. They are twice as likely as white workers not to make ends meet. The two ethnicities, respectively, earn $8.20 and $7.70 less per hour than white workers, this is a significant gap in earning potential. Jason Rahlan, the VP of corporate responsibility and sustainability for Dayforce, employers have an easy fix for the problem: raising wages or losing talented workers to other companies.

Rahlan said, “People not making a living wage are more likely to report struggling to pay for housing, overdrawing their checking and savings accounts, skipping healthcare, and purchasing medicine”. “When workers are at higher risk of suffering these negative outcomes, they’re going to be more at risk for leaving a workplace and seeking another job opportunity because they need the opportunity for a life of health, fulfillment, and dignity. He went on to say, “Companies choosing to invest in their people and address living wage gaps in their workforce is not only the right thing to do for their people, but the smart thing to do for their business.”

Share your thoughts:

Do you think employers need to do more than increase their employee's wages?

Do you think employers should also look into decreasing the workweek to four days a week instead of five days?