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What quality of life can workers earning nation’s highest minimum wage afford?

May 22, 2014 at 6:23 PM EST
Washington state has the highest minimum wage in the nation at $9.32. Can the state’s low-wage workers can meet their basic needs without assistance? Economics correspondent Paul Solman explores the quality of life for a baggage handler at the Seattle-Tacoma Airport and an employee of McDonald's.
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GWEN IFILL: The battle over the minimum wage heated up across the country today, as fast-food workers in several cities launched a one-day strike.

Outside Chicago, near the corporate home of McDonald’s, workers protested as the company held its annual meeting. More than 100 were arrested. The workers are demanding minimum pay of $15 an hour, which brings us to the question: What is it like to live on minimum wage, even in a state with the highest wage in the country?

The NewsHour’s economics correspondent, Paul Solman, profiles two people dealing with that question, all part of his reporting Making Sense of financial news.

TERRAN LYONS, Crew Trainer, McDonald’s: Everything just seems to be going wrong, you know? So, I’m just — I’m trying to be responsible and fix it, but it’s stressing me out.

(LAUGHTER)

PAUL SOLMAN: Terran Lyons was talking about her car, but it may as well have been her life. The 25-year-old single mother of two, a high school dropout, works as a crew trainer at a McDonald’s in Seattle, earning $9.85 an hour, just above the state minimum wage of $9.32.

Using her federal earned income tax refund, she moved to a cheaper suburb 30 miles south, close to her mother, who watches the kids while she works, and bought a 17-year-old car for the commute.

TERRAN LYONS: Car’s the quickest way for me to get there, because on the bus, I will be on there for three hours.

PAUL SOLMAN: How much did the car cost?

TERRAN LYONS: Twenty-five — $2,500.

PAUL SOLMAN: And how many miles does it have on it?

TERRAN LYONS: A lot.

(LAUGHTER)

PAUL SOLMAN: Let’s see.

TERRAN LYONS: It starts with two.

PAUL SOLMAN: Two — it’s two — more than 200,000 miles on it?

TERRAN LYONS: Mm-hmm.

PAUL SOLMAN: No wonder she’s already had to spend nearly a $1,000 in repairs and, on the day of our scheduled interview, the car was acting up again.

TERRAN LYONS: The steering wheel thing is loose. I guess there’s a steering wheel gear, and the steering pump. The steering wheel gear itself is $350 just for a used one.

PAUL SOLMAN: With a wiggly wheel and low on gas, Lyons couldn’t get to her apartment, where we were to have met, asked us to drive to the parking lot of her cousin’s housing complex next town over.

PAUL SOLMAN: How can you possibly afford to live anywhere near here at $9.85 an hour?

TERRAN LYONS: It’s really hard. I have a roommate.

(LAUGHTER)

TERRAN LYONS: That’s how I had to do it.

PAUL SOLMAN: And how much is your rent?

TERRAN LYONS: My rent, if it was me by myself, it would be $1,095.

PAUL SOLMAN: So since there are two of you, $550 a month?

TERRAN LYONS: Split it in half. Yes.

PAUL SOLMAN: And how much for food?

TERRAN LYONS: I do get help with food stamps, but, you know, because I have had my little 10 cent raise or whatever raise, they take like $100 or so away, so I only get $355. And my kids, they are growing. They eat. They eat more than me.

Come here. There’s a car coming.

PAUL SOLMAN: Sometimes, Lyons eats at McDonald’s, where she gets a 50 percent employee discount.

If you didn’t work at McDonald’s, could you afford to eat at McDonald’s?

TERRAN LYONS: If it wasn’t for the discount, uh-uh. I just wish I didn’t have to depend on stuff like that, you know? But I have stayed with fast food, because, you know, I have got a criminal background.

PAUL SOLMAN: And the criminal record?

TERRAN LYONS: Theft, three misdemeanors, shoplifting.

PAUL SOLMAN: Shoplifting. And why?

TERRAN LYONS: Well, there’s times where, you know, like, I used to go to high school. Me and my sister didn’t have no clothes, really. All — and everybody looked all nice and everything, and we didn’t have anything because our mom couldn’t afford it, you know? So I started stealing clothes.

And then, as I got older, I had been in some homeless situations, had to steal diapers, food for my children. No excuse for it, but that was why I was doing it.

PAUL SOLMAN: And did you wind up doing time?

TERRAN LYONS: A little bit. A little bit.

PAUL SOLMAN: So when you started at McDonald’s, $9.19 an hour, was that like a happy day, because you had gotten a paying job?

TERRAN LYONS: Mm-hmm. It was. I’m not trying to be on the state assistance. I would rather work, like responsible people do, you know?

PAUL SOLMAN: But can she really make it without the state assistance she receives?

Terran Lyons, two children, 3 and 5.

DIANA PEARCE, University of Washington School of Social Work: She would need about $27 an hour or about $4,700 a month.

PAUL SOLMAN: Triple what she earns, says University of Washington professor Diana Pearce, in order to pay for minimal basic needs in the Seattle area without public or private help.

DIANA PEARCE: In Washington State, even though our minimum wage goes up with inflation, from $6.50 to 9.32 an hour over the last decade, utilities are going up faster, health care’s going up faster, but also housing, child care, food, all those are going up faster.

PAUL SOLMAN: Way further south than Terran Lyons, on the outskirts of Tacoma, lives another barely-over-minimum-wage worker, Joshua Vina, with son Elijah and wife Erika.

Vina earns $9.50 an hour at Sea-Tac Airport working for contractor Menzies Aviation as a baggage handler. Like Lyons, he’s on public assistance, a $290 monthly housing allowance, $378 in food stamps, government-subsidized health care. His employer offers no benefits at all.

JOSHUA VINA, Baggage Handler, Seattle-Tacoma International Airport: Last week, I had bronchitis, and I went to the E.R. room. I was excused for two days to rest by the doctor. Now that’s going to be a shorter paycheck because I was sick. We don’t get sick paid days.

PAUL SOLMAN: You know, people watching are going to say, hey, plasma TV, PlayStation. You’re not really suffering.

JOSHUA VINA: It seems like I’m living just fine, but economy-wise, I’m not living fine at all.

PAUL SOLMAN: It’s hard for these people, but they had children out of wedlock, dropped out of high school, perhaps, and therefore can’t get the jobs that would pay them enough to meet their basic needs.

DIANA PEARCE: That’s not the point. The point is that, right now, they’re working. They’re doing what everybody says we should do, which is go out and work and support our families. The wages simply aren’t enough to cover the basic needs anymore. For two adults and an infant in the area where he lives, it would be more like $4,200 a month.

PAUL SOLMAN: Again, nearly triple the household’s income.

DIANA PEARCE: What that means is that they can’t afford housing, and child care, and food, and transportation, and to pay their taxes and health care, with a little bit for miscellaneous, like for clothes and soap and things like that.

PAUL SOLMAN: So, says Pearce, we taxpayers wind up with the basic needs bill, in effect, subsidizing the minimum wages, low prices and, presumably, profits at McDonald’s, Wal-Mart, airlines.

But it comes as a price to the workers too, says Vina, among other things, a complete lack of motivation.

As for him:

JOSHUA VINA: I barely talk to other people, because I feel so depressed about how I barely get by. I usually just look down at the ground most of the time where I walk. And it’s horrible.

PAUL SOLMAN: Look down at the ground because you’re afraid to make eye contact with people?

JOSHUA VINA: I usually used to be like this, you know? Now my face is like this everywhere I go.

If I were ever to see the CEO of Alaska Airlines in person, I would probably just tell him to look at me.

PAUL SOLMAN: It’s a face that says, here is the situation you’re creating, and this is the way I can most powerfully express it. Is that right?

JOSHUA VINA: Yes. That face is also: I am angry. I can yell at you, but what will that do? Will that change your mind? Instead, I want you just see this. Just look at all of it.

PAUL SOLMAN: Meanwhile, Josh had to go. It was Sunday, and he was headed to a wedding with his son before his late shift at work. One last question.

Have you been hurt on the job?

JOSHUA VINA: Yes, three times.

PAUL SOLMAN: Did you lose time at work because of the injury?

JOSHUA VINA: I did, actually. I lost a lot of time with my back injury, because I was always in pain, and I usually just called in, and it got me into trouble.

And for the third injury, it was the worst thing ever. They made me sit down and hold a sign saying “Menzies is now hiring” for a whole week, and they would get — they would get angry because I would go back inside, because it was cold outside, and I would try to rest inside.

PAUL SOLMAN: Did you get angry back, or say, hey, wait a second, this is not fair, or…

TERRAN LYONS: I would wait until they were gone, and then I would walk off and start yelling and screaming like, ahh, this — I can’t believe this is happening. Why is this happening to me? God, get me out of here.

PAUL SOLMAN: But Josh Vina can’t afford to get out of there, any more than Terran Lyons can. And there are enough American workers, even in Seattle, to fill their minimum wage jobs if they did.

CORRECTION: An earlier version of this story said that Joshua Vina handled baggage for Alaska Airlines. Vina moves baggage for other airlines at Sea-Tac Airport, but not for Alaska Airlines. His anger towards the CEO of Alaska Airlines stems from the fact that Alaska Airlines is the lead plaintiff in a lawsuit that has so far blocked implementation of a local proposition, passed by SeaTac voters last fall, which would have guaranteed airport workers like Vina a $15 an hour minimum wage and paid sick leave.