Nickel and Dimed: Undercover in Low-Wage USA (23 page)

In Key West, I earned $1,039 in one month and spent $517 on food, gas, toiletries, laundry, phone, and utilities. Rent was the deal breaker. If I had remained in my $500 efficiency, I would have been able to pay the rent and have $22 left over (which is still $78 less than the cash I had in my pocket at the start of the month). This in itself would have been a dicey situation if I had attempted to continue for a few more months, because sooner or later I would have had to spend something on medical and dental care or drugs other than ibuprofen. But my move to the trailer park—for the purpose, you will recall, of taking a second job—made me responsible for $625 a month in rent alone, utilities not included. Here I might have economized by giving up the car and buying a used bike (for about $50) or walking to work. Still, two jobs, or at least a job and a half, would be a necessity, and I had learned that I could not do two physically demanding jobs in the same day, at least not at any acceptable standard of performance.

In Portland, Maine, I came closest to achieving a decent fit between income and expenses, but only because I worked seven days a week. Between my two jobs, I was earning approximately $300 a week after taxes and paying $480 a month in rent, or a manageable 40 percent of my earnings. It helped, too, that gas and electricity were included in my rent and that I got two or three free meals each weekend at the nursing home. But I was there at the beginning of the off-season. If I had stayed until June 2000 I would have faced the Blue Haven's summer rent of $390 a week, which would of course have been out of the question. So to survive year-round, I would have had to save enough, in the months between August 1999 and May 2000, to accumulate the first month's rent and deposit on an actual apartment. I think I could have done this—saved $800 to $1,000—at least if no car trouble or illness interfered with my budget. I am not sure, however, that I could have maintained the seven-day-a-week regimen month after month or eluded the kinds of injuries that afflicted my fellow workers in the housecleaning business.

In Minneapolis—well, here we are left with a lot of speculation. If I had been able to find an apartment for $400 a month or less, my pay at Wal-Mart—$1,120 a month before taxes might have been sufficient, although the cost of living in a motel while I searched for such an apartment might have made it impossible for me to save enough for the first month's rent and deposit. A weekend job, such as the one I almost landed at a supermarket for about $7.75 an hour, would have helped, but I had no guarantee that I could arrange my schedule at Wal-Mart to reliably exclude weekends. If I had taken the job at Menards and the pay was in fact $10 an hour for eleven hours a day, I would have made about $440 a week after taxes—enough to pay for a motel room and still have something left over to save up for the initial costs of an apartment. But were they really offering $10 an hour? And could I have stayed on my feet eleven hours a day, five days a week? So yes, with some different choices, I probably could have survived in Minneapolis. But I'm not going back for a rematch.

All right, I made mistakes, especially in Minneapolis, and these mistakes were at the time an occasion for feelings of failure and shame. I should have pulled myself together and taken the better-paying job; I should have moved into the dormitory I finally found (although at $19 a night, even a dorm bed would have been a luxury on Wal-Mart wages). But it must be said in my defense that plenty of other people were making the same mistakes: working at Wal-Mart rather than at one of the better-paying jobs available (often, I assume, because of transportation problems); living in residential motels at $200 to $300 a week. So the problem goes beyond my personal failings and miscalculations. Something is wrong, very wrong, when a single person in good health, a person who in addition possesses a working car, can barely support herself by the sweat of her brow. You don't need a degree in economics to see that wages are too low and rents too high.

The problem of rents is easy for a noneconomist, even a sparsely educated low-wage worker, to grasp: it's the market, stupid. When the rich and the poor compete for housing on the open market, the poor don't stand a chance. The rich can always outbid them, buy up their tenements or trailer parks, and replace them with condos, McMansions, golf courses, or whatever they like. Since the rich have become more numerous, thanks largely to rising stock prices and executive salaries, the poor have necessarily been forced into housing that is more expensive, more dilapidated, or more distant from their places of work. Recall that in Key West, the trailer park convenient to hotel jobs was charging $625 a month for a half-size trailer, forcing low-wage workers to search for housing farther and farther away in less fashionable keys. But rents were also skyrocketing in the touristically challenged city of Minneapolis, where the last bits of near-affordable housing lie deep in the city, while job growth has occurred on the city's periphery, next to distinctly unaffordable suburbs. Insofar as the poor have to work near the dwellings of the rich—as in the case of so many service and retail jobs—they are stuck with lengthy commutes or dauntingly expensive housing.

If there seems to be general complacency about the low-income housing crisis,
this is partly because it is in no way reflected in the official poverty rate,
which has remained for the past several years at a soothingly low 13 percent
or so. The reason for the disconnect between the actual housing nightmare of
the poor and “poverty,” as officially defined, is simple: the official poverty
level is still calculated by the archaic method of taking the bare-bones cost
of food for a family of a given size and multiplying this number by three. Yet
food is relatively inflation-proof, at least compared with rent. In the early
1960s, when this method of calculating poverty was devised, food accounted for
24 percent of the average family budget (not 33 percent even then, it should
be noted) and housing 29 percent. In 1999, food took up only 16 percent of the
family budget, while housing had soared to 37 percent.
[35]
So the choice of food as the basis for calculating family budgets seems fairly
arbitrary today; we might as well abolish poverty altogether, at least on paper,
by defining a subsistence budget as some multiple of average expenditures on
comic books or dental floss.

When the market fails to distribute some vital commodity, such as housing, to all who require it, the usual liberal-to-moderate expectation is that the government will step in and help. We accept this principle—at least in a halfhearted and faltering way—in the case of health care, where government offers Medicare to the elderly, Medicaid to the desperately poor, and various state programs to the children of the merely very poor. But in the case of housing, the extreme upward skewing of the market has been accompanied by a cowardly public sector retreat from responsibility. Expenditures on public housing have fallen since the 1980s, and the expansion of public rental subsidies came to a halt in the mid-1990s. At the same time, housing subsidies for home owners—who tend to be far more affluent than renters—have remained at their usual munificent levels. It did not escape my attention, as a temporarily low-income person, that the housing subsidy I normally receive in my real life—over $20,000 a year in the form of a mortgage-interest deduction—would have allowed a truly low-income family to live in relative splendor. Had this amount been available to me in monthly installments in Minneapolis, I could have moved into one of those “executive” condos with sauna, health club, and pool.

But if rents are exquisitely sensitive to market forces, wages clearly are
not. Every city where I worked in the course of this project was experiencing
what local businesspeople defined as a “labor shortage”—commented on in the
local press and revealed by the ubiquitous signs saying “Now Hiring” or, more
imperiously, “We Are Now Accepting Applications.” Yet wages for people near
the bottom of the labor market remain fairly flat, even “stagnant.” “Certainly,”
the New York Times reported in March 2000, “inflationary wage gains are not
evident in national wage statistics.”
[36]
Federal Reserve chief Alan Greenspan, who spends much of his time anxiously
scanning the horizon for the slightest hint of such “inflationary” gains, was
pleased to inform Congress in July 2000 that the forecast seemed largely trouble-free.
He went so far as to suggest that the economic laws linking low unemployment
to wage increases may no longer be operative, which is a little like saying
that the law of supply and demand has been repealed.
[37]
Some economists argue that the apparent paradox rests on an illusion: there
is no real “labor shortage,” only a shortage of people willing to work at the
wages currently being offered.
[38]
You might
as well talk about a “Lexus shortage”—which there is, in a sense, for anyone
unwilling to pay $40,000 for a car.

In fact, wages have risen, or did rise, anyway, between 1996 and 1999. When
I called around to various economists in the summer of 2000 and complained about
the inadequacy of the wages available to entry-level workers, this was their
first response: “But wages are going up!” According to the Economic Policy Institute,
the poorest 10 percent of American workers saw their wages rise from $5.49 an
hour (in 1999 dollars) in 1996 to $6.05 in 1999. Moving up the socioeconomic
ladder, the next 10 percent-sized slice of Americans—which is roughly where
I found myself as a low-wage worker—went from $6.80 an hour in 1996 to $7.35
in 1999.
[39]

Obviously we have one of those debates over whether the glass is half empty
or half full; the increases that seem to have mollified many economists do not
seem so impressive to me. To put the wage gains of the past four years in somewhat
dismal perspective: they have not been sufficient to bring workers up to the
amounts they were earning twenty-seven years ago, in 1973. In the first quarter
of 2000, the poorest 10 percent of workers were earning only 91 percent of what
they earned in the distant era of Watergate and disco music. Furthermore, of
all workers, the poorest have made the least progress back to their 1973 wage
levels. Relatively well-off workers in the eighth decile, or 10 percent-sized
slice, where earnings are about $20 an hour, are now making 106.6 percent of
what they earned in 1973. When I persisted in my carping to the economists,
they generally backed down a bit, conceding that while wages at the bottom are
going up, they're not going up very briskly. Lawrence Michel at the Economic
Policy Institute, who had at the beginning of our conversation taken the half-full
perspective, heightened the mystery when he observed that productivity—to which
wages are theoretically tied—has been rising at such a healthy clip that “workers
should be getting much more.”
[40]

The most obvious reason why they're not is that employers resist wage increases with every trick they can think of and every ounce of strength they can summon. I had an opportunity to query one of my own employers on this subject in Maine. You may remember the time when Ted, my boss at The Maids, drove me about forty minutes to a house where I was needed to reinforce a shorthanded team. In the course of complaining about his hard lot in life, he avowed that he could double his business overnight if only he could find enough reliable workers. As politely as possible, I asked him why he didn't just raise the pay. The question seemed to slide right off him. We offer “mothers' hours,” he told me, meaning that the workday was supposedly over at three—as if to say, “With a benefit like that, how could anybody complain about wages?”

In fact, I suspect that the free breakfast he provided us represented the only
concession to the labor shortage that he was prepared to make. Similarly, the
Wal-Mart where I worked was offering free doughnuts once a week to any employees
who could arrange to take their breaks while the supply lasted. As Louis Uchitelle
has reported in the New York Times, many employers will offer almost anything—free
meals, subsidized transportation, store discounts—rather than raise wages. The
reason for this, in the words of one employer, is that such extras “can be shed
more easily” than wage increases when changes in the market seem to make them
unnecessary.
[41]
In the same spirit, automobile
manufacturers would rather offer their customers cash rebates than reduced prices;
the advantage of the rebate is that it seems like a gift and can be withdrawn
without explanation.

But the resistance of employers only raises a second and ultimately more intractable question: Why isn't this resistance met by more effective counterpressure from the workers themselves? In evading and warding off wage increases, employers are of course behaving in an economically rational fashion; their business isn't to make their employees more comfortable and secure but to maximize the bottom line. So why don't employees behave in an equally rational fashion, demanding higher wages of their employers or seeking out better-paying jobs? The assumption behind the law of supply and demand, as it applies to labor, is that workers will sort themselves out as effectively as marbles on an inclined plane—gravitating to the better-paying jobs and either leaving the recalcitrant employers behind or forcing them to up the pay. “Economic man,” that great abstraction of economic science, is supposed to do whatever it takes, within certain limits, to maximize his economic advantage.

I was baffled, initially, by what seemed like a certain lack of get-up-and-go on the part of my fellow workers. Why didn't they just leave for a better-paying job, as I did when I moved from the Hearthside to Jerry's? Part of the answer is that actual humans experience a little more “friction” than marbles do, and the poorer they are, the more constrained their mobility usually is. Low-wage people who don't have cars are often dependent on a relative who is willing to drop them off and pick them up again each day, sometimes on a route that includes the babysitter's house or the child care center. Change your place of work and you may be confronted with an impossible topographical problem to solve, or at least a reluctant driver to persuade. Some of my coworkers, in Minneapolis as well as Key West, rode bikes to work, and this clearly limited their geographical range. For those who do possess cars, there is still the problem of gas prices, not to mention the general hassle, which is of course far more onerous for the carless, of getting around to fill out applications, to be interviewed, to take drug tests. I have mentioned, too, the general reluctance to exchange the devil you know for one that you don't know, even when the latter is tempting you with a better wage-benefit package. At each new job, you have to start all over, clueless and friendless.