Labor day – a holiday created by the labor movement and dedicated to the social and economic achievements of American workers – provided little reason for North Carolina workers to celebrate this year. The State of Working North Carolina, an annual report assessing how workers in the state are faring, shows what many North Carolina workers already know: unemployment continues to plague the state and many workers – despite working full time – are just not getting by.
Nearly 1 in 4 workers in the state are in occupations that pay less than $22,811 – the 2011 poverty threshold for a family of four. Roughly half a million workers in North Carolina are supporting themselves, and often their families, on the minimum wage of $7.25 per hour.
The minimum wage has received some long-overdue attention as of late with increasing attention to growing income inequality and national proposals based on the premise that those who work full time should not be living in poverty. Pre-labor day protests all across the country, and in North Carolina, highlighted the extreme disparity between workers struggling to make ends meet with soaring corporate profits in one of the few industries growing in the state.
Here in North Carolina, the minimum wage tracks the federal minimum wage and it’s hard to argue that $7.25 per hour is a living wage. And the fact that the wage is not tied to inflation means that as the costs of food and energy go up, wages remain stagnant.
Moreover, research shows that raising the minimum wage can be a tool for economic growth. Low-wage workers are more likely than any other income groups to spend earnings immediately on basic needs and services, which in turn increases consumer demand. The GDP impact of increasing the federal minimum wage to $9 per hour, for instance, would be close to $500 million in North Carolina.
North Carolina workers need a raise. It’s a well-known fact that rates of lower union membership result in lower wages, and unfortunately, North Carolina remains the state with the lowest union density in the country. Our state’s workers have suffered over the last three decades as the manufacturing industry crumbled and the economy shifted toward lower-wage jobs in such sectors as the service industry. The “recovery” from the Great Recession has witnessed declining wages. In the wake of Labor Day, it’s time to honor the hard work of North Carolinians by supporting the policies that support working families.