2 - Contemporary living wages in practice

Summary

Living wage movements have been growing in prominence around the world. This chapter reviews the characteristics, objectives and achievements of these movements. It starts by giving a brief characterization of how they have developed in different countries. The chapter then looks thematically at three key aspects of living wages in practice: how they are calculated, how they are advocated and how they are implemented.

Living wages around the world

Most countries around the world have some form of minimum wage, either general or by industry or occupation. In many countries, there is an implicit aspiration that these wages should be sufficient to allow workers a decent standard of living. However, much fewer countries have explicit “living wages” or living wage campaigns. These have emerged in particular in English-speaking countries in recent years.

United States

Across the United States, hundreds of local living wage campaigns have sprung up since the early 1990s. These campaigns, often driven by community action groups, many supported by faith-based organizations, and also involving trade unions, were typically founded to improve pay for specific groups of low-wage workers in local areas. Such a bottom-up approach has had many different strategies for achieving change. Its most widespread success has been in getting cities to pass ordinances establishing a living wage rate for any employer receiving public contracts to deliver services. Within a decade of the first such ordinance in Baltimore in 1994, over 100 cities had done the same.

The plight of workers providing public services at very low pay rates via contracted employers thus gave impetus to the contemporary US living wage movement, not least because public authorities had leverage over these employers as their clients. However, this revival of the living wage concept, combined with growing wage inequalities and the continuing fall in the value of the federal minimum, has stimulated wider efforts to extend wage floors. Various employers such as corporations, universities and employers within defined areas such as airports have been encouraged to adopt a living wage.

More broadly, campaigns to impose a higher minimum for all employees within cities and states have enjoyed considerable success.