Labor panel weighs defining ‘livable wage’

AUGUSTA – The Legislature’s Labor Committee is considering defining the idea of a livable wage and writing the definition into state law.

Three bills deal with the issue, and all are built on a study two years ago by the Maine Center for Economic Policy, an Augusta-based think tank.

The study added up the estimated costs of food, housing, telephone, health care, transportation, child care, clothing, personal care and household goods, as well as taxes for families of various sizes, to arrive at a number.

That has some in the business community worried.

“When an employer is looking to come to this state, they look at a variety of different things,” said Peter Gore of the Maine State Chamber of Commerce.

“If you place this in the wage-and-hour laws, it is going to cause a lot of concern among employers. They will see it as a precursor of things to come, foreshadowing a requirement that employers pay a livable wage.”

The 2004 study by the Maine Center for Economic Policy was cited several times in testimony before the Labor Committee last week.

“It is important to note that these calculations represent a very Spartan existence and represent a bare-bones budget,” said Ed Cervone, a policy analyst with the policy center. “This is basic.”

The center’s calculations indicated that in 2004 a single person with one child would need to make $14.84 per hour, or $30,865 a year, to meet the livable-wage standard.

“This meant that over half of all workers would not have been able to meet this mark,” Cervone said.

In the report, the policy center acknowledged the statewide average numbers provide only a measure for comparison with other states.

And by region, the numbers vary widely.

In Cumberland County, including Greater Portland, the group calculated $16.02 an hour is needed, while in Penobscot County, just $11.90 an hour would meet the standard.

It is that disparity by region that Gore believes could make attracting businesses to Maine more difficult. He said if employers know a state-defined livable wage is on the books, they would conclude that the next step would be to make it the new minimum wage.

“That would be disastrous,” he said. “We would be totally out of line with the rest of the country.”

Jim McGregor, executive vice president of the Maine Merchants Association, has been watching the livable-wage issue develop over several years and shares Gore’s concerns.

“Our business climate has a lot of problems already,” he said. “This would not help us. It would hurt us.”

But the concept of defining a livable wage in law has the support of a number of organizations, including the state Department of Labor.

“The Maine Department of Labor’s Workforce Investment Act state plan promotes employment and skills training opportunities that provide a livable wage, leading to economic security,” said Vanessa Santarelli, assistant to the state labor commissioner. “Defining livable wage in statute moves this goal forward.”

Other supporters said the legislation is aimed at setting a “benchmark” and is not designed to replace the minimum wage.

Sarah Standiford, executive director of the Maine Women’s Lobby, said the measures could be crafted to provide useful data for setting policy.

“Defining a livable wage is critical if we are going to identify the appropriate policy interventions to increase wages, to ensure the self-sufficiency of Maine families and to build a strong economy for the future,” she said.

In its testimony, the Maine Education Association was clear its goal is to raise wages in Maine to the livable standard.

“All workers in Maine should be paid wages that allow their families to be economically self-sufficient,” said Joseph Stupak of the education association.

Gore said it is fine to determine a valid way to calculate a livable wage, but that it need not be put into law.

He said many in the business community see defining it in law as a first step to turning the minimum wage into a livable wage.