November 21, 2008

In Trying Times, Employees Struggle to Make Ends Meet

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This is the first part of a four-part series analyzing socioeconomic issues at Cornell and in the surrounding community.

According to the Alternatives Federal Credit Union in 2007, a single person with no dependants would need to make $20,450 a year or roughly $9.83 per hour for a 40-hour work week to fulfill most of his or her needs. Factoring in housing, transportation, health care, recreation and other necessities, the AFCU conducts the Living Wage Study bi-yearly to keep up with current trends in the economy and the cost of living. This figure represents a 7-percent increase over the estimate of $19,102 reported in 2005.
These figures represent a “living wage,” or the minimum wage for a worker to meet basic needs to live a comfortable and healthy life. The figure varies by location and family size. While it seems that $20,450 would be enough for a person to live off on his or her own, a family of one child and one adult would require $26,400 to meet its basic needs.
Of course, these figures were calculated before the recent financial crisis gripped the nation.
As the largest employer in Ithaca, Cornell employs 11,504 people including regular full-time and part-time non-professional-faculty academic employees, according to its website. Currently, the University has approximately 3,000 faculty members.
Thus, many employers in Ithaca look to Cornell as model of how to compensate em­ployees, acknowledging that University pay affects the greater well-being of the community.

A History Remembered
Cornell has come a long way from the wages it paid in the early 1990s. In 1992, new custodial workers earned a mere $6.50 per hour.
Flash-forward to 2008 — new hires receive a starting wage of $12.49 per hour. Efforts to raise wages have been an ongoing struggle that most recently came to a head in 2001.
At the time, there was a movement to raise wages for janitors working at universities around the country, most notably at peer institution Harvard University. Though Harvard is known as “the world’s richest university,” a Harvard committee found that many of the university’s low wage employees, mainly janitors and dining employees, were paid less than a living wage.
The committee was formed in response to one of the largest sit-ins in Harvard’s history, staged by a group of 40 students to protest the low wage paid to these groups of workers.
Cornell was swept up in the movement with the inception of the Cornell Living Wage Coalition, which included the Cornell Organization for Labor Action and the Center for Religion, Ethics and Social Policy, among others.
As a result of nationwide efforts, there was significant progress made in securing a living wage for the lowest-paid workers around the country. However, many University employees have indicated that Cornell can do more to help low-wage employees make their paycheck stretch farther.

The Way They Get By
Though $12.49 per hour may seem like a lot of money for a low-wage job, many employees do not have the option of working a full 40-hour work and instead work 30 or 35-hour work weeks. Though some employees actively choose to not work a full work week and appreciate the flexibility of the work hours, many workers explained the difficulty of making ends meet in these unstable economic times.
Carl Feuer Ph.D ’83, a member of the Workers’ Center Steering Committee, indicated that a worker who makes $12.49 an hour and works a 30-hour week would earn about $19,400 for the entire year, not factoring in money that is that goes to taxes — a wage almost $1,000 below the living wage for a single person.
Last year, UAW Local 2300, the main union in Ithaca that represents Cornell’s service and maintenance workers, issued a report that stated, “Four of every ten dining workers at Cornell — almost half — receive less than the Tompkins County Living Wage for a single person of $20,450.”
UAW is the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America. UAW, one of the largest and most diverse unions in North America, represents workers from a range of sectors, including small manufacturers, state and local governments and colleges and universities.
One worker explained that even though she makes a little over $13 per hour, it was very difficult to meet all of her financial needs as a single person.
“Before I got engaged, I had a lot of trouble making ends meet,” she said. “I had to work two jobs to cover all of my costs. It’s easier when there is another person to help you.”
Even more startling is that the UAW reported that 75 percent of low-wage workers do no make enough money to meet the basic family living wage of $26,400.
One dining worker commented, “If you live very meagerly and not too high, then you can make it as a single person.”
Terry Sharpe, president of UAW Local 2300, believes Cornell can afford to pay its workers more, but that C.U. is currently doing an adequate job of paying a living wage for the area.
“I think for the most part they do [pay a living wage] for this area. It is a place people really want to work,” she said.
One University employee remarked, “I don’t think Cornell will ever consider paying a full living wage.”
Some were surprised that wages at Cornell were not significantly higher due to the amount of money the University generates annually from its endowment.
One worker who has been with Cornell for 10 years said, “I make the same amount here [at the University] as I did at the Ithaca School District. I was really surprised by that given the size of Cornell.”
Feuer, who also works at UAW Local 230, elaborated that Cornell sees itself as a business and must try to keep labor costs low.
Wages for workers do increase the longer somebody works at Cornell. Currently, in the 2008-2009 year, employees who started working at Cornell prior to June 30, 1994 and are in the highest pay scale, can make up to $23.30 per hour.
Peter Tufford, director of staff and labor relations, said that the minimum average salary is $24,000 based upon a $12 per hour wage. Yet Tufford explained that not all employees work year-round due to seasonal needs.
“I don’t know how any employer could control the number of hours that one is paid based on need,” he said. “All of our employees are based on need. Service employees are dependant on students being [at the University]. There are times when we need people in full strength and times we don’t.”
For many workers who already have reduced-hour work weeks, this can be problematic because they are forced to look elsewhere for work. However, Tufford indicated that the University does try to keep employees during the summer months. Using the example of dining hall workers, he explained they may not be able to keep people in the fields they normally work in, but they will try to move them around to an area that does need help.
“What happens during the summer is that there may not be work in dining, but they’d be working in a different operations through Campus Life,” Tufford said.
But many workers are starting to struggle in light of the economic crisis that has caused gas prices to rise as well as the cost of other consumer goods. Sharpe predicts the situation will get worse before it gets better.
For many workers who live outside of the Ithaca area, it is difficult to find money to commute to work when gas is so expensive. One worker stressed the need to put aside at least $100 every week for gas in order to get to work. Many employees cannot rely on the bus system to transport them because it does not run at the times they start or end their shifts. Some workers’ shifts start at 5 a.m., when there are no buses running. Likewise, most bus stop running after 2 a.m., when some workers are just getting off their shift.
With the current state of the economy, workers are also worried about layoffs though Tufford said layoffs would be a last resort. The University has investments in the stock market and relies on funding from the state, both of which pose a number of budgetary challenges.
Nevertheless, many University employees recognize Cornell as a decent employer that provides a generous health insurance plan and other benefits.
Prof. Lance Compa, collective bargaining, labor law and history, believes that Cornell, for the most part, is a good employer.
Tufford said, “From Cornell’s perspective, we pay very fair wages and benefits. For comparable work, there is no other employer [in the area] who is going to come close to paying the same.”
“They are a good employer. I see myself retiring here. The only way I’d ever leave is if I moved out of state,” one worker said.

Where Do They Go From Here
UAW Local 2300’s collective bargaining agreement with Cornell expires at the start of summer 2009, so the University and the union will begin renegotiating terms sometime in the spring.
Sharpe expects that Cornell will take the approach that the University cannot afford to raise wages because of the economic crisis. She believes that Cornell will ask workers to do more with less.
From his viewpoint, Compa said that Cornell is not facing any imminent dangers due to the crisis. Instead, he expects hard bargaining from both the union and management, which is ultimately the ideal situation because it ensures a balanced result if both sides are strong.
“While no employers have unlimited funds, it will be a question of give-and-take that both parties can live with. The economic crisis will shape the bargaining, but not the result of it,” he said.
Tufford said it is still too early to tell how the economic crisis will impact negotiations come springtime, but he assures that the workers will be treated like any other employee.
“From the union relationship, we’ve had some challenges. We’ve worked through them over the years. The way things are now are as much of an unknown for us as they for them. [The union] represents our employees and we respect them. I’m confident we’ll find answers to whatever the issues might be,” he said.