At the end of last month’s e-teaching, I mentioned the fact that only 2.6% of all American workers earn the federal minimum wage and that minimum wage workers are typically young, single people who have just entered the work force work and who only want to work part time. They are earning the minimum wage only temporarily, and are on their way up and out.
I knew as I wrote those statistics that they would be little consolation to breadwinners who are only earning the minimum wage (or slightly higher) and who are struggling to meet the needs of their families. Thankfully, one compassionate reader, whom I will refer to as “Glenn,” wrote to provoke me to consider their plight. I asked if I could use his words as the starting point in my next e-teaching, and he gave me permission:
You are showing that you may be a bit out of touch with the small town working class….
Yes, many companies pay more than minimum… barely more. Here in [my town], a lot of companies avoid that statistic by being mere pennies above the minimum… But the fact is, the vast majority of our community here is sentenced to wages well below poverty level, forced to work 50-60 hours or more a week at these low paying jobs to pay the bills….
Even dollars above minimum wage isn’t a living wage in our economy. Just a few things to think on.
Of course, our hearts go out to all the people who fit Glenn’s description. So I want to address the working poor in this e-teaching and offer my best counsel, for what it is worth. But let me start by affirming what I wrote last month about anyone putting hope in an increased minimum wage. The net result is that while some low-wage workers gain a higher income, other low-wage workers lose their jobs, some potential new workers are prevented from entering the work force, and the cost of living increases for everyone, including low-wage workers.
Concerning that last point, Australia’s average minimum wage of $16 per hour might sound wonderful to anyone who doesn’t actually live in Australia. The cost of living in Australia, however, is quite high, and in part because of the $16 minimum wage, of course. According to this chart, in light of Australia’s cost of living, the minimum wage is really more like $9.77.
Oregon’s legislators recently rushed legislation to increase their state minimum wages by 2022 to $12.50 in rural areas, $13.50 in mid-size regions, and $14.75 in greater Portland. State analysts have since concluded that the higher wages will “result in approximately 40,000 fewer jobs in 2025 than would have been the case absent the legislation.” Seems like another classic case of “when helping hurts.”
What will happen when Eastern Oregon apple growers have to pay their workers $5 more per hour than apple growers across the border in Idaho? Since they will have no choice but to pass their increased costs on to those who buy their apples (in bulk for distribution), those buyers will undoubtedly start gravitating to Idaho for their apples. So by “helping” agriculture workers via an increased minimum wage, Oregon’s legislators are effectively setting them up to lose their jobs. Oops!
My strongest-felt piece of advice for low-wage workers is, don’t pin your hopes on the state or federal government raising the minimum wage. If the minimum wage is raised, you might be one of the people who loses his job, and you will certainly be one of the people who finds his cost of living increasing so that your net gain is much less.
Those Big Companies That Pay Slave Wages
My second strongest-felt piece of advice for low-wage workers is, don’t be angry at the “big company in your town that pays slave wages.” There is no sense getting angry, because there are economic forces at work that are bigger than any company.
First, that big company is competing with every other similar company, and it has no choice but to compete. That is generally a good thing that benefits all of us. But because customers want the lowest prices, every company attempts to reduce its expenses, and one means is by paying employees as little as possible. If you want to blame someone, blame customers who seek the lowest prices! (Of course, I’m sure that YOU don’t care about prices when you shop…)
Second, very few people start or own companies because they want to provide lucrative employment opportunities. People start or own companies to make money for themselves. The more they can lower their expenses, the more profits they can keep for themselves (or for the shareholders if the company is publicly owned). So companies are again motivated to pay employees as little as possible.
The primary reason companies pay some workers more than others is because companies have to compete with other companies for more highly-skilled workers. Because they are in less supply, higher-skilled workers have leverage that lower-skilled workers don’t. It is all a matter of supply and demand.
No government is more powerful than the economic principle of supply and demand. No matter what laws are passed to affect the prices of goods and services, prices will always fluctuate with supply and demand. When supply is low and demand is high, prices increase. When supply is high and demand is low, prices decrease. When it comes to wages, employers offer lower wages when there is a large supply of workers. But some jobs require more skills than others, and for those jobs there is a smaller supply of workers. Thus the wage price goes up. So the key to achieving higher wages is to possess knowledge or skills that make you more valuable to employers.
The good news is, you can start today to acquire what will make you more valuable. Please allow me to elaborate on several ways—all biblical—that you can immediately begin to put yourself in higher demand by making yourself the type of desirable worker who is in shorter supply.
1.) Love your neighbor as yourself. (I told you this would be biblical!) Your neighbors include your fellow employees, your boss, and your company’s customers. Treat them just as you would want to be treated if your roles were reversed.
Do you like it when you have to cover for slackers, those employees who create more work for others? Then don’t be a slacker. Rather, “Whatever you do, do your work heartily, as for the Lord rather than for men” (Col. 3:23 ).
Do you appreciate encouragement? Then be an encourager.
Do you like to be around grumpy, depressing, negative people? Then be happy. You can’t be too happy. (In my life I have only ever known one person who was too happy.)
Do you enjoy listening to gossip of co-workers, realizing that when you aren’t around, they are likely gossiping about you? Then “let no unwholesome word proceed from your mouth, but only such a word as is good for edification according to the need of the moment, so that it will give grace to those who hear” (Eph. 4:29).
If you were the boss and your boss was you, would you be happy if you caught her on Facebook when she was supposed to be doing something that benefits the company? If you are not doing something that benefits the company while on the clock, that is theft.
Do you appreciate being treated like an inconvenience rather than a customer? Then remember that customers are the people who pay your wages.
I am amazed at how rare good customer service is in some business establishments. Here’s a tip: If you work in retail and a customer is in the process of making a payment for a purchase, if the phone rings, say to the customer, “Don’t worry, you were here first, and I’m not going to allow someone on the phone to cut in line! Customers trump callers!”
Loving others will make you more rare and thus more valuable.
2.) Humbly serve. If the greatest among us is the servant (as Jesus said), then we should be striving to serve others at our jobs. That means making things easier, not more difficult, for your fellow employees, your boss, and your company’s customers. When you serve others, they appreciate it, and your chances of being rewarded are much greater.
One of the best pieces of career advice I’ve ever heard was, “Take work from your boss.” Too many employees create work for their bosses. When layoffs are mandated, those people are on the short list. They are known as “blessed subtractions.”
3.) Humbly lead. Leaders are more rare than followers. That is fundamentally why leaders earn more than followers. Good leaders—who love and serve others—are even more rare.
Anyone can learn to lead, even those who think they can’t. People who are children of almighty God, indwelled by the Holy Spirit, and who have all the wisdom of Scripture available to them certainly have the capacity to learn to lead others.
Leaders face challenges that followers don’t, and leadership is sometimes lonely and painful, which is why many people who could become leaders don’t. Followers of Christ who are called to deny ourselves and take up our crosses, however, should already be familiar with some of the suffering that comes with making decisions that aren’t popular. In short, being willing to do what others are not willing to do is often the key to higher earnings. Learning to lead others is one of those things.
4.) Earn trust. I once met a man who immigrated to the U.S. from Guatemala. The only job he could find was working as a parking lot attendant. After a few months, his boss, who owned several parking lots, told him that the parking lot he managed was his most profitable. So he transferred his star employee to his largest parking lot, which then became the most profitable under his management, while his formerly-managed parking lot became much less profitable. Long story short: his boss eventually realized that all of his other employees were skimming profits for themselves, while the Guatemalan immigrant was not. His boss fired everyone but him and made him manager over all his new employees.
Trustworthy employees are much more likely to be rewarded than untrustworthy employees.
5.) Acquire more knowledge and skills. “The mind of the prudent acquires knowledge, and the ear of the wise seeks knowledge” (Prov. 18:15).
Again, knowing that employers always pay their employees as little as possible, the only way to force them to pay you more is to make yourself more rare and thus more valuable to companies that are competing for people like you.
Acquiring more knowledge and skills takes time. Anyone can learn how to wash dishes in a few minutes. That is why dish washers make the minimum wage. It takes years of study, however, and the investment of tens of thousands of dollars to acquire what it takes to be a doctor. So cardiologists earn in two minutes what a minimum wage worker earns in an hour.
You don’t have to enroll in night school (although that might be a very wise decision) to gain knowledge that will make you more rare and valuable. You just need to take an hour that you currently waste each day doing what profits you nothing and start doing something that will ultimately profit you something. Like studying your industry. Or reading to gain knowledge that will set you apart from others. Or pursuing a higher certification.
Generally, experience itself has value, which is one reason companies give annual raises. So be loyal and become the best at what you do.
But don’t be too loyal, because as I have already said, companies are motivated to pay employees as little as possible. They love to pay loyal employees less than they are actually worth, as lower wages give them an advantage over their competitors. If you have marketable skills that are in demand, use the forces of supply and demand to your advantage. That means always keeping your periscope up, looking for companies that understand the true value of your skills. Even if you love your current job, if there is another company that is willing to pay you more to do the same thing, you can mention it to your boss in hopes that he or she will at least match the better opportunity! Now the forces of supply and demand are working in your favor! (Sure hope none of the employees of Heaven’s Family are reading this!)
6.) Stop blaming others for how little you make. When we blame others, we give ourselves an excuse to stagnate since “my fate is beyond my control.” The greater truth is that our own choices have much to do with our lot in life. Happy is the person who takes responsibility for his own fate and decides to apply the unalterable laws of supply and demand!
Perhaps you’ve decided to live in a geographical location where there is little demand for employees, such as a rural area. The only way you will increase your earnings is to relocate to a place where there is more demand for what you have to offer. Cities and towns exist for economic reasons. Industries and businesses interact and a local economy is created. The only way you can benefit from that is to supply some goods or services within an economy. (Of course, these days it is possible to interface with distant economies if you can provide a good or service through the internet.)
And remember, if you don’t like how little your company pays you, you can just quit. No one is holding you hostage.
“But there is no other employer in my rural area, so I would be unemployed for sure!”
That tells me your company is paying you exactly what your are worth in your local economy. Your company knows that if you quit, there is someone equally qualified who is waiting to take your place for the same or a lesser wage. Supply and demand is working against you! Too much supply and too little demand.
If you want to earn more, you will have to relocate to a place where there is more demand for what you have to offer. Obviously, there are some regional economies that have much more demand than others (see, for example, this article).
If you live in a town where the largest business is a hardware store, and the manager makes $25,000 a year, chances are pretty good that you will never make more than $25,000 a year if you stay in your town. And if you do ever achieve $25,000 a year, you are going to have to wait for the current manager to quit or retire, and then you’ll have to compete with other people who apply for his job! A lot of risk for very little reward!
Of course, there is the possibility that you might value rural living over a higher income, in which case you’ll have to be content with your rural income because you prefer the wealth of scenic views and country air, or you will have to figure out a way to remotely tap into a distant economy where there is more demand for what you have to offer.
If you do decide to relocate, you should compare the cost of living where you live with where you are thinking of living. If you can get a job that pays you 20% more, but the cost of living is 30% higher, you’ll be poorer! Still, generally speaking, the economic advantages of those who live in or near cities as opposed to rural regions are obviously significant.
7.) Realize that you are not poor. I have to say this, of course! There are people reading this who can’t imagine making $7.25 per hour (the current federal minimum wage in the U.S.), much less $7.25 per day. They live in developing countries. We’ve been brainwashed to believe that we must have everything that no one in the world had for the first 6,000 years, and that most of the people in the world don’t own today. Any of us could economize if we had to.
When I was a pastor some years ago, a young couple came to me requesting help from our church’s benevolence fund. Although the husband had an above-average-paying job, they were having financial trouble. Although I didn’t have the nerve, I wanted to ask them, “Has it gotten so bad that you’ve had to cancel your cable TV subscription, quit smoking, and find someone to adopt your two enormous dogs?” Those apparently were all necessities in their minds, so much so that they felt that I should use some of the tithes of people in our church (many of whom were making less than this couple) to help them make ends meet!
OK, I’ve done my best, even if it is not good enough! Thanks for any and all feedback. I read it all!