Something is stirring in the Land of the Free. Across the United States, tens of thousands of workers are waking up to find more money in their pockets and a little more job satisfaction after two of the nation's largest employers announced surprise pay rises for their lowest paid workers.
In the last few weeks both Walmart and McDonald's have bowed to pressure from trade unions and civil rights groups and raised their respective minimum wages to over $9 an hour. Meanwhile, 21 U.S. states raised their own minimum pay levels this year, helping thousands more low-wage workers.
So, are we witnessing a new wage revolution or a handful of low-impact PR stunts from the world of big business? McDonald's will raise its lowest wages to an average of $9.90 by July 1, lifting the pay of around 90,000 employees in the U.S. There is a catch. The vast majority of minimum wage McDonald's workers in America - around 750,000 - work for independently-owned franchises and will not benefit from the hike.
Walmart's decision to raise its own minimum pay to $9 an hour will affect 500,000 workers and is a welcome sign from the world's largest retailer. However, like McDonald's, the rise is barely above national minimum wage and it will take a lot more to end Walmart's rock-bottom wages and union-busting activities.
Although a step in the right direction, the pay rises of Walmart and McDonald's as well as those of the other big-name U.S. employers to recently announce their own hikes including Target and T.J Maxx, are not enough for their workers to make ends meet or to shift the balance of the American economy to a fairer standing.
Despite some early signs of economic recovery, American wage growth remains weak and the majority of income gains are going directly to the top 1% of earners. The true picture of today's U.S. economy is one of gross income inequality. In 2010, the wealthiest 1% of Americans held a staggering 35% of all wealth whilst the bottom 90% held just 23%.
The easiest and most effective way to better distribute this wealth is through higher wages. Across the world, there is a growing consensus that a revival of labor market institutions and collective bargaining is the only way that decent work and fair pay can be achieved. Putting money back into the pockets of working people will increase demand and purchasing power - good for workers, good for business. That is why the moves from McDonald's and Walmart, although small, could be so important if other companies follow suit.
The task of righting America's wage problems remains huge. More than half of all workers continue to earn less than $15 per hour (CHF14.5). Almost a quarter of all jobs in America pay wages below the poverty line for a family of four whilst four million Americans are entitled to food stamps.
Whilst employment is on the rise, the quality of jobs certainly is not. The definition of employment itself has shifted towards low-paid, insecure jobs with little or no protection for workers. Nowhere is this more prevalent than in the fast-food world of McDonald's.
As America's third largest employer, a McDonald's job is one of the lowest paid in the country but the stereotypical image of fast food workers being teenagers earning pocket money is outdated. Around 4.1 million people work in the U.S. fast food industry with an average age of 29 years old. Women make up two-thirds of all employees. The majority of these workers have families to support, childcare costs to cover and rent to pay.
The McDonald's rise came during a high-profile national campaign aiming to raise fast food wages across America to a minimum of $15 an hour and to create a trade union for workers. Thousands of fast food cooks and cashiers in nearly 200 cities from coast to coast have joined the Fight for $15 movement with several waves of national one-day strikes. Large rallies in support of the $15 per hour rate are scheduled in several large U.S. cities on April 15.
Fast food workers have been joined in their Fight for 15 by other workers from retail, home health, childcare and security. In the same way that Walmart's pay increase prompted Target to raise their own wages, it is hoped that other fast food companies may be compelled to follow McDonald's example. The Fight for 15 rallies to be held on April 15 across America and around the world are not only the culmination of this collective worker-led struggle, they are also the breeding ground for a new generation of trade unionists who will accept nothing less than a decent day's pay for a decent day's work.
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