Our Minimum Wage Debacle

The federal minimum wage for covered nonexempt employees is $7.25 per hour effective July 24, 2009. The federal minimum wage provisions are contained in the Fair Labor Standards Act (FLSA).

Many states also have minimum wage laws. In cases where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages.

The FLSA does not provide wage payment or collection procedures for an employee's usual or promised wages or commissions in excess of those required by the FLSA. However, some states do have laws under which such claims (sometimes including fringe benefits) may be filed.

The Department of Labor’s Wage and Hour Division administers and enforces the federal minimum wage law.

People not entitled to the National Minimum Wage

  • Self-employed

  • Volunteers

  • Voluntary workers

  • Work experience

  • Certain apprentices

  • Company directors

  • Government employment programs

  • European Community Leonardo da Vinci, Youth in Action, Erasmus and Comenius programmes

  • Living in your employer’s household

  • Work for friends and neighbors

  • Members of the armed forces

  • Share fishermen

  • People living in a religious or other community

  • Prisoners

However, it is possible for States to approve legislation that increases their minimum wage above the National Minimum Wage.

According to the US Department of Health and Human Services, the financial threshold to be considered living in poverty is $15,930 for a family of 2 and $4,160 is added for each additional household member above 2..

In a family of 2 (1 adult & 1 child), if one person is working at minimum wage for 40 hours each week for 52 weeks, then their annual income is $16, 120. On average, the monthly expenses for this type of family will be around $4,000/month which includes: housing, food, childcare, transportation, healthcare, taxes, other necessities. Our annual expenses total $48,000.

If we look now look at a family of 3 (2 adults & 1 child), we can double our annual income to $32,240 but our monthly expenses will increase to about $4,500/month or $54,000.

It does not take a brain surgeon to see that if you are working for 40 hours somewhere for minimum wage then in order for you to survive, you are going to need to work a second job just to pay your expenses and keep your head above water.

This just does not seem right here in America or anywhere in the world for that matter.

However, most of the companies that I know pay $10/hour in this area of East Tennessee where I am currently living which does not necessarily mean that other companies in other locations pay this amount.

If we apply $10/hour to our 2 family examples above, we have the following:

Example #1
1 Adult/1 Child – $20,800 income with expenses $48,000

Example #2
2Adults/1Child – $41,600 income with expenses $54,000

Let me point out here that the average monthly expenses that I used was a National Average and it is possible in some areas of the country to have monthly expenses less than the National Average, especially if you are a family with little to no debt. In fact, monthly expenses can be as low as $2,500-$3,000/month and when we use the lower of these two, our annual expenses reduces from $48,000 down to $30,000.

If we were to somehow get our monthly expenses down to $2,000/month, we would still need an annual income of $24,000 after withholding and taxes. So, in order to generate an income of $24,000 from 40 hours of work each week, we are going to need right at $12/hour; and, if we need “take home” pay of $24,000 then we will need a salary of $30,000 or $14.50/hour.

I don't mean to be cruel or critical here, especially about America, but if you are a single parent with just a high school education, then you are currently SOL if you think you are going to get ahead of the curve if you continue to follow your current course of action.

Now, you do have some option if you are a single parent and they are:
  1. Get married
  2. Get a roommate
  3. Get more education
  4. Move back in with your parents
  5. Move to a lower cost of living location
Now, there are other options than the ones I have listed that are likely available to you, but something has got to change, if you want to get out of this rut, because living off of minimum wage is no longer viable in the US.

Why do our lawmakers continue to allow this to happen to those of us who have to live like this in America whether we or Americans or another nationality?

If we can fight other country's wars why can we not take care of our workers?

Is this situation because American Business and Industry have lobbied the Senate and Congress to keep this minimum wage suppressed because it would increase their expenses and either reduce profits or increase prices which would make them uncompetitive in the global marketplace?

So, do we care more about business than our citizens in this country?

is it because our lawmakers (Congress and Senators) do not understand what it is really like to live on minimum wage because they are all millionaires?

It is easy for a millionaire or billionaire to listen to your financial problems and be empathic and sympathetic but when push comes to shove, they really cannot identify with you in the way you have to live and what you have to give up.

Many of them think that the reason that you are not like them is because you are lazy.

  • What do you think one of the millionaires/billionaires would tell you if you suggested that they live like you have to live for 3-5 years and then return to their wealth...
  • What about live like you do for 2-3 years and then return to their wealth
  •  What about live like you do for 6 months to 12 months and then return to their wealth...

It is doubtful that they would accept trading places for any length of time at all, and yet, as mentioned, they will tell you that they understand what it is with which you have to deal.

So, here is the question: If this is what they think of us (on average) then how can they pass legislation that has our best interests in mind?

  • Would you go to a marriage counselor who has never been married?
  • Would you go to a marriage counselor who has been married/divorced 3 times?
  • Would you go to a marriage counselor who is and has been married for 25 years?

Post Script: Whenever the minimum wage is increased, there is always a corresponding increase in teenage unemployment, and when teenagers are unemployed, there is a higher degree of probability that these youths will get in trouble with the law. Why does this happen? If employers have to pay higher wages, then they want an older employee because of the perception that older means more mature and more mature means arriving to work on time, less absenteeism, and less turnover.

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