Across the country and here in the Twin Cities, the unemployment rate is very low and workers are in high demand. Economics 101 tells us that means wages should go up as firms compete to attract and retain employees. Yet almost 80% of workers live paycheck-to-paycheck, and average real wages fell for the largest group of employees in the US over the last year.
So why haven’t wages gone up?
Business Insider gets right to the point in the title of an article they published last month: The 'supply-and-demand model of labor markets is fundamentally broken,' and that's why you're not getting a pay raise anytime soon.
“Working is no longer a guaranteed way of getting ahead. Instead, it may keep you poor… Today everyone has work, yet work no longer offers a ladder out of poverty for people willing to climb it.”
Over the last 40 years, workers have lost the unions and bargaining power that set wages at livable levels. Meanwhile, massive corporations like Walmart and Amazon have championed a Race to the Bottom that depresses wages and working conditions across the world. The gig economy means big corporations like Uber can keep wages as low as possible in every moment, while making billions in profits all the while.
That’s why more and more economists are coming to the conclusion that “it’s less about supply and demand than about institutions and politics.”
Employers lower wages and working conditions as much as possible to maximize profits. The only way to stop the Race to the Bottom is for workers to build movements in their workplaces and in the streets to demand higher wages, rights, and dignity. That’s why workers have used strikes, rallies, and demonstrations to fight for a $15 minimum wage across the country. We’ve proven that workers can organize and change the political climate to win real victories, even when the political establishment says it’s impossible.
We reject the idea that the majority of people should live in financial insecurity in the richest country in the history of the world. Nobody who works for a living should live in poverty. That’s why we won’t stop organizing until we win a $15 minimum wage for every worker, no carve-outs, no exemptions. Come to the August 4th Public Input Session to tell the City of Saint Paul you say NO to poverty wages and demand an economy that works for us, the workers!