D&T.com: McDonalds’ suggested budget for employees shows just how impossible it is to get by on minimum wage

[WakkaWakka]

You do realize this proposed budget is working one full time job and an almost full time job?

 

Poor peeps shouldn't have iPhones. They shouldn't have cable. Those are the only frivolous things you can really point to in the budget, unless you want to include a car.  

 

Question: At what point do we raise minimum wage? The purchasing power of $7.25 decreases by the minute.

[TD_washingtonredskins]

I don't want to come off as some 1%-er either. To me, everything is on a spectrum. My wife and I have to turn down offers for vacations, say no to certain things we'd like to have, etc. just like everyone else. Our threshold is just higher than someone making minimum wage. We would love to take the 4-5 yearly vacations some of our friends do. I would love to convince her to quit so that she could maybe start her own company doing something she enjoys.

 

But, because we like the things we have and want to live a certain way, we have to make the right decision. It's no different than someone making less than us maybe cancelling HBO, downgrading from a smartphone to a regular cell phone, etc. It's a sliding scale.

[ncr2h]

You're right. We shouldn't expect more than mud huts and a steady diet of rice and beans in the wealthiest country on Earth. Anything more is luxury, like health insurance as you stated.

 

 Nevermind the growing income disparity. Pay no attention to the man behind the curtain.

 

Right on time.

 

Health insurance is pretty much by definition a luxury item.  The purchase of health insurance is in effect a gamble that your predictable monthly payments will be lower than your unpredictable payments would have been if you had not purchased the insurance.  As with all gambles, the house takes a cut and tilts the odds in its favor.  For the wealthy or risk-averse, the house's cut may be worth the knowledge that future health-related payments are more predictable and stable.  But it looks completely silly when people try to act like health insurance is a great deal for everybody.

You do realize this proposed budget is working one full time job and an almost full time job?

 

Poor peeps shouldn't have iPhones. They shouldn't have cable. Those are the only frivolous things you can really point to in the budget, unless you want to include a car.  

 

Question: At what point do we raise minimum wage? The purchasing power of $7.25 decreases by the minute.

 

Should poor people not have parents, relatives, spouses, significant others, or friends to split their expenses with, or are we living in a world where to expect them to do so is something like expecting them to live in a mud hut?

[TD_washingtonredskins]

You do realize this proposed budget is working one full time job and an almost full time job?

 

Poor peeps shouldn't have iPhones. They shouldn't have cable. Those are the only frivolous things you can really point to in the budget, unless you want to include a car.  

 

Question: At what point do we raise minimum wage? The purchasing power of $7.25 decreases by the minute.

 

I'm not necessarily for or against raising minimum wage. I don't know enough about the argument to chime in yet. I was agreeing with NC's observation that including luxuries in a budget speaks volumes for where we are as a nation in some ways. Living without a car, a smartphone, and cable would make a huge difference on the scale being represented in that budget. And, depending on where you live, taking public transportation to and from work is feasible.

 

Also, as it pertains to the second job, if it's truly meant to represent additional hours by the same person (not another job by a second income-earner in the household), then that certainly sucks. Life isn't always easy and I'm not being sarcastic when I say that it would be a tough road for those people.

 

However, there are options everywhere. You can live with roommates to defer some of your rent/utilities. You can use public transportation as I stated above. I lived in a brand new townhouse in Arlington a few years back with two friends and barely spent what is being used as the rent/mortgage amount so I KNOW that people can live comfortably for far less than that.

 

My main point is that there seems to be a much higher "worst case scenario" in many minds. Sometimes life requires you to roll up your sleeves and gut it out. If minimum wage goes up $2 per hour, I don't really believe that solves any of these philosophical problems. You would honestly have a good number of minimum wage workers just indulging in a couple more luxuries each month (which is fine, it's their choice and, quite honestly, my wife and I do the same when we get raises).

[mistertim]

So what you're saying is that pretty much every other industrialized western nation is a nanny state that showers their citizens in unnecessary luxury because they believe that health care is actually something that everyone should have?

 

Any chance that we're the ones on the wrong side of that debate and not the ton of other countries that provide health care for their citizens?

[WakkaWakka]

Right on time.

 

Health insurance is pretty much by definition a luxury item.  The purchase of health insurance is in effect a gamble that your predictable monthly payments will be lower than your unpredictable payments would have been if you had not purchased the insurance.  As with all gambles, the house takes a cut and tilts the odds in its favor.  For the wealthy or risk-averse, the house's cut may be worth the knowledge that future health-related payments are more predictable and stable.  But it looks completely silly when people try to act like health insurance is a great deal for everybody.

 

Basic health care has inelastic demand. Health insurance is a bad deal for everybody in this country as things stand now. The government, health care lobby, insurance lobby, your local representative, the FDA all share the blame.

 

The reality is that a minor visit to the hospital would bankrupt anyone subsisting on minimum wage. My insurance company was billed nearly 13k for one night in the hospital for child birth. Nevermind my wife went all natural, used a midwife instead of a doc, and was out of there in less than 24 hours.

 

If corporations are entitled to act in their own self interest, then I don't want to hear you complain when the poor use the emergency room as a general care practitioner. They are acting in their own self interest.

[TD_washingtonredskins]

For the record, I'm not factoring in health insurance.

 

I just believe you can cut money from rent/mortgage ($100 at least), car ($150), and cable/phone ($50 at least). That's a big chunk of the net income being shown above.

[MattFancy]

For the record, I'm not factoring in health insurance.

 

I just believe you can cut money from rent/mortgage ($100 at least), car ($150), and cable/phone ($50 at least). That's a big chunk of the net income being shown above.

 

I dunno about taking $100 off the rent/mortgage. That would depend on where you live and if you have roommates.

[TD_washingtonredskins]

For the record, I'm not factoring in health insurance.

 

I just believe you can cut money from rent/mortgage ($100 at least), car ($150), and cable/phone ($50 at least). That's a big chunk of the net income being shown above.

 

I dunno about taking $100 off the rent/mortgage. That would depend on where you live and if you have roommates.

 

Exactly. If I'm working at McDonald's I'm not going to insist on living in the best place by myself. Anecdotally, I lived in Arlington, VA for $800 with a couple roommates. This was a brand new townhouse, we each had our own full bathrooms, etc. and we were the first renters ever. The three of us EASILY could have cut that rent in half if we had rented an older house, been willing to share a bathroom, etc.

 

There's no reason that most of this country couldn't have a roommate or two and figure out how to rent a place for $500 per month.

[gortiz]

man, if are out of high school and relying on minimum wage, you have to stop whatever you are doing and deeply examine what's wrong with your life ... (barring health issues or extreme bad luck of course) 

 

My suggestions for living off minimum wage: 

 

1. quickly figure out priorities, do you need an Iphone with a huge data plan? 

2. don't piss off your parents, if you are respectful, helpful and attitude free, even the WORST parents will at least let you stay at their place until you make more money - 

3. don't have kids

4. think hard about a trade or going to school and get help applying for school loans

5. don't get in trouble with law

6. mind the company you keep 

7. be humble

 

 

i'm not smart, i come from ZERO money, parents were poor, god knows I didn't get by on my looks! but i followed the rules above, and I might not be a world beater but i got my MPP, i've owned a few homes, married, blah, blah, blah.  

 

If I had to choose, I think the most important out of those six is 2 and 3. 

[Kilmer17]

I just went back and looked at the OP.

 

That budget has a monthly spending line of 800 dollars!

 

That's alot of money to spend on food/gas and fun every month.

[Bang]

.

Should poor people not have parents, relatives, spouses, significant others, or friends to split their expenses with, or are we living in a world where to expect them to do so is something like expecting them to live in a mud hut?

Yay for welfare!

 

This budget expects this fictional person to have 2 jobs, a 70 hour work week and no heat.

 

it's not reasonable. If Mcdonalds and other low paying jobs were just for young people who have the luxury of parents to sponge from, it would be one thing. But the notion that america is just chock-full-a-jobs to the point that anyone wanting to can go out and better themselves is evaporating. Fact is, i see a LOT of people who are in their so-called peak earning years working in these crap jobs because it's all they can get. McD's isn't just staffed by high school kids anymore.

The paradigm has changed. Workers used to be valued, and their ability to live (even if scantly) off of their wage strengthened the entire system. Plenty of people still aspire to higher, and paying a living wage has not and will not create a country of people who are content to stay poor.

Paying them nothing does. They have to get public assistance, and so they do, and because they typically live pissed off at the world for having them work so hard for so little, they quickly fall into the "i'm entitled to this' attitude.

 

So, what do we do?

Yell at them for needing welfare, make them go sponge off their parents and harm their ability to not suck off the system into the age where they will need the most.. anything but actually pay them what it would require to get by.

 

so long as the top gets theirs, we all..  uhh..

what, exactly? the nation gets weaker, our dollar gets weaker, our workforce gets weaker..  but the "job creators" get richer, and that is all that matters.

 

~Bang

[TD_washingtonredskins]

I just went back and looked at the OP.

 

That budget has a monthly spending line of 800 dollars!

 

That's alot of money to spend on food/gas and fun every month.

 

That last line reminded me of McD's old "food, folks, and fun" commercials.

[Springfield]

So health insurance is a luxury and should be avoided by poor people. In the same breath, you could say that all these poor people with no health insurance is what drives up the cost of medical treatment.

So, we don't want them to have insurance (too expensive for them) but will lambast them for not having insurance (makes the price of our insurance more expensive).

[TD_washingtonredskins]

Some keep saying this assumes 70 hours per week for one individual. Do we KNOW that was an assumption built into this specific budget? Isn't it possible that this is a budget based off a two-income family and the "2nd job" represents a spouse's income contributing to the total?

Bang, what do you believe would be a suitable minimum wage to fix the issues that you describe? It would have to be significant, wouldn't it? Another couple bucks per hour doesn't seem like it would change the situation.  

[Springfield]

Double the minimum wage. That will fix a lot.

[TD_washingtonredskins]

Double the minimum wage. That will fix a lot.

As I said earlier, I don't really care if that happens but I also don't know enough to know the risks (inflation, etc.).

[Bang]

Some keep saying this assumes 70 hours per week for one individual. Do we KNOW that was an assumption built into this specific budget? Isn't it possible that this is a budget based off a two-income family and the "2nd job" represents a spouse's income contributing to the total?

Bang, what do you believe would be a suitable minimum wage to fix the issues that you describe? It would have to be significant, wouldn't it? Another couple bucks per hour doesn't seem like it would change the situation.  

I don't know the answers.

I just know there's a hell of a problem.

 

People absolutely need to live withuin their means, so the first step is to change people's mindset of entitlement, but at the same time, even someone who scrimps and pinches every penny is failing.

I don't advocate turning McD's into a job that will raise a family, but if it's to be a springboard-job into that American-dream life, you have to be able to begin to get on that road..  but it just puts you further behind.

 

~Bang

[Springfield]

Double the minimum wage. That will fix a lot.

As I said earlier, I don't really care if that happens but I also don't know enough to know the risks (inflation, etc.).

Nor do I. Maybe we should triple it just in case.

[The Evil Genius]

I think one of the articles on the previous pages mentioned that the average US rent is over $1k now.

 

Additionally, the $1100 monthly take home pay from the first job was assuming a 40 hour work week at $7.72 an hour (higher than minimum wage), I think.

 

Of course, I think the original budget did a disservice in assuming low healthcare costs and rent and not lumping the cable and phone charges into the monthly spending money category.  

[pjfootballer]

I kind of have a problem with both ends of the spectrum.  I think corporations have too large a profit margin as others have suggested in here.  The greed at the top is terrible, when looking back on companies like Enron and such.

 

But at the other end, if you end up working at minimum wage jobs in your mid 30s or into your 40s, who do you have to blame but yourself?  There are plenty of other avenues through education, trades, military and such.  I mean, don't take my post as saying all poor people are lazy, as that's not what I think.  I know some people have been hit with hard times and that's understandable.  But somewhere along the line you have to rethink your position.  I also see a cycle of poverty in some families.  I've worked at DSS before and I saw one generation come in for benefits and then the next generation coming in the door behind them.  The hardest part is breaking that cycle.

 

We weren't rich or upper middle class growing up.  We were working class, did ok for ourselves and could always pay our bills.  Myself, I'm 45 and it took me 23 years to get to a job paying over 60K.  I had to earn my way up.  My first full time job out of college payed $6.60 an hour in an office (1991).  I had to live with roomates, had to scrimp and save and had to eat alot of Ramen.  It can be done, but you have to be patient.  This generation wants to come out of college making 60-100K and aren't willing to work their way up the ladder.

 

I would like to see minimum wage go up at the expense of profits, but isn't the cost of paying a factory worker to screw in a bolt for $30+/an hour what got the auto industry in trouble?  There has to be limits, but I would like to see it go up.

[elkabong82]

You can't raise a family on single income from lowest paid jobs in the country.  Unless they raise MW to $15+/hour.  As previously stated, those jobs were not intended, nor should they be, to raise a family on.

 

And...$100 for cable?  I don't even pay that. IMO if you're really scrimping for $, you don't have cable and your phone is the cheapest cell you can buy.

 

Look at the budget again. It shows 1 person working 2 jobs that can barely support themselves. Even if it is low wage, a person working 2 jobs should be able to support at least themselves at a decent, comfortable level.

 

The cable thing included phone, which is necessary for employers to contact you if you want to improve your job status. There are cheaper cable packages, but everyone needs some form of entertainment and it usually costs money. So if you don't have cable then you are just going to spend that money on other forms of entertainment. But hey, at least the extra savings means they could then afford to heat and cool their living space on that budget.

 

I think it's time society started changing its view on the value of low wage jobs. Most of them require labor and/or putting up with a lot of BS from customers and management that treat you like crap because your job is low wage. As I pointed out earlier in this thread, a lot of office jobs where a person does make a decent living, the tasks are not challenging and don't require a lot more out of a person than a McDonald's shift does and those companies don't post near the profits that McDonald's does. 

 

I also think that people's views on minimum wage is antiquated. Many think $10/hr is too much "just to flip burgers" but ignore the rising costs all around them. We are in an age now where minimum wage does need to be higher than $7.25, and the 2 income budget that 1 person can't really live off of is proof. Even a small increase up to $10 would be enough. The top keeps increasing, so there's no reason the bottom shouldn't rise as well. 

[endzone_dave]

One of the problems with raising the minimum wage is the strain on small businesses.  When I go to the local hardware store, there is always a teenage kid there to greet me and take me to where I need to go in the store.  If you raise minimum wage too high, the store can't afford the kid and then I might as well wander the aisles lost in Home Depot.

[elkabong82]

I just went back and looked at the OP.

 

That budget has a monthly spending line of 800 dollars!

 

That's alot of money to spend on food/gas and fun every month.

 

It also doesn't include heating and has health insurance listed at $20, problems that were brought up in the article if you read all of it. 

 

2 jobs, that's a lot of gas. Let's say 1 tank a week, on a small car, so $50 a week, $200 month. Health insurance at the lowest is $100 month, so there's 300. Groceries, eating healthy but not luxuriously, $50 week, so 200 month. That is 500 now. Rent at $600? Not if you live in the city or in NoVA. I say rent because you aren't getting a mortgage working 2 low wage jobs. Hope you don't mind having at least 2 roommates. I hope you don't ever have to go to the doctor or dentist, or have any car repairs or maintenance. God forbid you want to enroll in some night classes to improve your education and get a better job. You won't have the time and certainly not the money. God forbid you want to to go out 1 or 2 nights out of the month and have fun, nope a person working 2 low wage jobs certainly doesn't DESERVE that as an option.

 

And in order for the budget to work as is, you have to be making above minimum wage. If you are making minimum wage then you need to work a total of 74 hours a week in order to even have that budget be possible. You have to work 74 HOURS A WEEK just to make that bare minimum budget feasible. 

 

.... or the minimum wage could be raised to $10 and then low wage workers could afford education and improve their job statues, and the country would improve as well. Which is better, companies setting record profits and that money staying at the top, widening the income disparity to levels not seen since some of the worst economic times in our country's history, OR marginally improving minimum wage so people working 2 jobs can make a decent living, get an education if they want, and increasing the purchasing power of the majority population thus strengthening the economy? Tough choice.

[TD_washingtonredskins]

You can't raise a family on single income from lowest paid jobs in the country.  Unless they raise MW to $15+/hour.  As previously stated, those jobs were not intended, nor should they be, to raise a family on.

 

And...$100 for cable?  I don't even pay that. IMO if you're really scrimping for $, you don't have cable and your phone is the cheapest cell you can buy.

 

Look at the budget again. It shows 1 person working 2 jobs that can barely support themselves. Even if it is low wage, a person working 2 jobs should be able to support at least themselves at a decent, comfortable level.

 

The cable thing included phone, which is necessary for employers to contact you if you want to improve your job status. There are cheaper cable packages, but everyone needs some form of entertainment and it usually costs money. So if you don't have cable then you are just going to spend that money on other forms of entertainment. But hey, at least the extra savings means they could then afford to heat and cool their living space on that budget.

 

I think it's time society started changing its view on the value of low wage jobs. Most of them require labor and/or putting up with a lot of BS from customers and management that treat you like crap because your job is low wage. As I pointed out earlier in this thread, a lot of office jobs where a person does make a decent living, the tasks are not challenging and don't require a lot more out of a person than a McDonald's shift does and those companies don't post near the profits that McDonald's does. 

 

I also think that people's views on minimum wage is antiquated. Many think $10/hr is too much "just to flip burgers" but ignore the rising costs all around them. We are in an age now where minimum wage does need to be higher than $7.25, and the 2 income budget that 1 person can't really live off of is proof. Even a small increase up to $10 would be enough. The top keeps increasing, so there's no reason the bottom shouldn't rise as well. 

 

Nice post.

 

I don't have any issue with raising minimum wage if it's deemed unfair. I do have a bit of an issue with the assumption that any human deserves to afford current luxuries (well, they have to do SOMETHING at night) just because they are ambitious enough to work. Maybe these jobs are undervalued and could demand a few more dollars per hour. But I don't think that fixes too much.

 

Also, if there are all of these office jobs that are not nearly as challenging as a minimum wage job, then they should be considered an option for the people working minimum wage jobs. If you are telling me that someone making minimum wage right now could meet all the requirements and perform all the duties of a salaried staff worker at an office, then by all means they should apply.