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Susan Green

Wages Far Below Minimum Standard

Bureau of Labor Statistics Says Family Needs $3,500 to Meet Costs

(10 May 1948)

From Labor Action, Vol. 12 No. 19, 10 May 1948, pp. 1 & 4.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Some time back a Congressional committee was curious to know how the other half lives or “what it costs a worker’s family to live.” The Bureau of Labor Statistics obliged and came up with “a necessary minimum” budget for a family of four. The prices used are as of June 1947. The CIO has brought the figures up to the higher prices of January 1948. Here is the result.

With a pencil and a pad one discovers that on the basis of a forty-hour week, of fifty weeks a year (allowing a couple of weeks for one kind of “absenteeism” or another) or of 2,000 hours a year, the hourly rate of pay would have to be $1.75 for the worker with his family of four to get that $3,500 necessary minimum. If the worker has a family of five, his rate of pay would have to go to nearly $2 an hour to total the $3,900 required by the BLS.

Gap Is Big

Let us see how the workers stand in relation to this level set by BLS, which we will show later is a miserably low level of existence. How many workers get an hourly rate of $1.75, to say nothing of $2? The majority of even highly skilled workers earn less than those rates, and the larger number of semi-skilled and unskilled laborers work on much lower scale. This statement can be backed up by instances from specific industries.

In steel where jobs are divided into thirty categories with the lowest rate 94½ cents an hour, in some plants at least one third of the workers are receiving $1.13 and $1.21 hourly pay – a far cry from the $1.75 or $2 required by the BLS budget. A very few in the top layers earn around $2 an hour, rollers being listed at $2.13. Even such skilled men as hearth pourers and speed regulators in rolling mills have rates of only $1.61. In some cases regular wages are supplemented by a production bonus, entailing of course more intense labor.

In the auto industry average low-paid workers, such as stock chasers, in Detroit receive $1.25 an hour and in Cleveland $1.10, leaving a gap of 50 cents and 65 cents between what they get and what the BLS says they should get. The tool and die makers in the industry, the top classifications, receive in Detroit $1.87 and in Cleveland only $1.70; the former falling far short of the BLS level for a family of five and the latter for a family of four.

In shipbuilding, carpenters, electricians, boilermakers, that is, skilled men, rate a mere $1.50 on the east coast. The top crafts, namely, loftsmen and pattern makers, reach $1.65 and $1.75. However, heavy manual labor rates only 93 cents in Mobile and New Orleans, and $1.09 and $1.12 in Baltimore and northern yards.

So we could go on from industry to industry in this parade of shamefully inadequate wage scales. In textile, clothing, rubber, the picture is the same. What else can be expected since the overall average wage in all manufacturing is $1.18 an hour, 57 cents less than the BLS minimum for a family of four and 82 cents less than the minimum for a family of five!

One must also take into account that even today, when the capitalist system boasts of full employment, workers are laid off for one, two and even three months a year for one reason or another, be it because of material shortages, seasonal factors or something else. Five weeks without work means a corresponding ten per cent cut in the annual income. Unemployment benefits today by no means make up this loss. The utmost that can be expected under present unemployment insurance is from $80 to $100 for a five-week wage loss.

Insulting Standards

Is it any wonder that the workers are asking for what has come to be called “labor’s third round of wage increases?” Is it any wonder that they want also a guaranteed annual wage? The average worker lives on a level far below the BLS requirement. When he is laid off, his level sinks even lower. And that is not all.

The standard used by the BLS isan insult to the working people. In this age when the possibilities for good living are almost limitless, when profits go beyond the capitalists’ fondest hopes, when billions flow freely for war preparations, the BLS budget allowed for workers – and which they do not even get – is a skimping, worrying, gruelling and humiliating thing.

The wife is supposed to do all the housework – the marketing, the cooking, the cleaning, the washing and ironing – without any paid assistance. While the budgeteers conceded that a washing machine is necessary under these circumstances, actually out of one hundred families, in a twelve- month period, only seven can affordto buy a washing machine. This status assigned by the BLS budget to the working class housewife, is the measure of the whole shabby standard.

While the budget allows for a five-room living unit with bath, electricity and heat, and in not too bad a neighborhood, it makes no provision at all for repairs and redecorating that so many tenants must do themselves these days. The food allowance is 24 cents per meal per person, a figure below the average per capita consumption in the United States as a whole. The meat ration is a little more than one quarter of a pound per day per person, naturally of the lowest cost cuts, provision being made magnanimously for a turkey on Thanksgiving, Christmas and New Years.

The principle followed by the budgeteers is summarized in their words thus: “The budget level must be sets of goods and services regarded as so necessary that families would go into debt or reduce their level of savings to maintain consumption at that level when, for example, prices in general were increased ...” In a word, the irreducible minimum is good enough for the workers – and they don’t get even that.

The clothing allotment, for instance, includes one fifth of a skirt per year for the wife and one tenth of a suit for her. The house furnishings budget permits two pillow cases a year for a family of four. Of smaller items, one telephone call is permitted every three days, one half pack of cigarettes a day for husband and wife together, six tenths of a permanent wave per year for the wife. Against a rainy day, this worker is supposed to insure himself in an amount not exceeding $85 a year premium – which is absolutely laughable in its inadequacy. No other allowance for saving is made in this munificent budget.

Labor’s Needs

Recently Fortune magazine broke down the spending of a family in the $25,000 income level, and showed how difficult it is to make ends meet these days. The workers of this country do not reach even the miserable $3,500 allotted them by this government bureau!

Other budgets for working-class families, from non-government sources, have been higher than that of the BLS. For example, the Heller Committee of the Social Research of the University of California placed the needs of a family of four in the San Francisco region at $450 higher than the $3,500 of the BLS – another measure of the abyss between whatworkers need and what they have. Only recently the New York City Housing Authority has been obliged to raise the ceiling of incomes for tenants in city projects to $4,000 and $4,500. Again, this highlights the difference between the minimum needs of workers and their actual receipts.

Thus we see the insecurity that sits like a ghost at the worker’s meager board. Such figures as above en-able us to understand the compulsion behind labor’s drive for higher wages; the motive of the miners in their strike for pensions; the more urgent demands for health insurance and sick benefits, for unemployment insurance, for guaranteed pay. They also underscore the need for labor to form its own class party.

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Last updated: 17 February 2020