Doing it tough?


The other night I was watching  "Foreign Correspondent " on the ABC TV on employment and wages in the USA.  The reported said the following. "The federal minimum wage in the US is $7.25 an hour but for restaurant and bar staff it’s much lower - $2.13.  . It’s tips or starve”.  I thought I had mis-heard the dollars - $7.25 per hour with restaurant workers earning $2.13 per hour. No, I hadn't, this was how much many American workers are earning per hour.  I almost fell of my chair. 


No wonder so many are living in poverty and are unable to rise up and get ahead.  The USA is called the wealthiest country in the world, but for many it its only a dream that is out of their reach.

“Close to 50% of Americans are working and are economically insecure. And that means they can’t afford their housing, their healthcare, their childcare, their transportation. They can do no saving for an emergency or their own retirement. Half of the country lives in economic insecurity”.


Australians have no idea how fortunate they are.  No only are we paid well in comparison, our working entitlements are very good and we have a generous welfare system and a health system that (even with its problems) is accessible to all.  

"Most Americans have seen their incomes stagnate or fall since 2008. In fact, if you look in the middle, the average typical American income today is lower than it was say 15 years ago. Median income of a full-time male worker today is lower than it was 40 years ago." (Professor Josepeh Stiglitz Economist, Columbia university)

I thought I would check the figures for Australia and do a comparison.  Whilst the USA minimum wage is $7.25 an hour and even less for those in the restaurants, in Australia the full-time minimum wage is $16.37 per hour or $622.20 per week. Casual workers covered by the national minimum wage get an extra 24%  with a per hour rate of $20.30, this increase is because they do not receive holiday or sick pay.  This means that most employees in the national system should not get less than the minimum wage.  Employers can pay the award rate or far more if they wish.  Many people get paid much higher wages e.g. office workers, this would be typical for those in retail and restaurant/café type industries.

Another way of looking at income is "average weekly ordinary time earnings" - weekly earnings excluding overtime.  In Australia the average weekly ordinary time earnings as at May 2013:
  • $1,516.40 (males)
  • $1,250.50 (female)
  • $1,420.90 (persons)
Female earnings are lower than males due to the amount of part-time work Australian women do (more than American women) and women tend to be employed in lower skilled lower paid employment such as retail, childcare, factory workers etc.. However when compared to the USA - the average weekly earning for a person is $831 (or $419 per week for someone in retail). 

Australian's need to wake and realise we are doing ok and have very little to complain about. 

As to working entitlements - for example I receive 4 weeks holidays every year plus 19 days sick/carers leave (to use if I am sick or my husband or parents need care). This is generous, not all workplaces are as good, but we are doing so much better than elsewhere. We also get something called  long-service leave  which gives workers 3 month leave after being employed with the same company for 10 years. I have 3 months stored up that I can use whenever I want.  

The one differences that I think is important to note - our employers do not pay for our health insurances, we pay this ourselves. It is considerably cheaper than the USA and we also have a public Medicare system that generally works well as is assessable to everyone. 

The other point of differences is tipping - we don't tip, perhaps occasionally in restaurants but never very much. 

Sometimes we don''t appreciate or understand how much better off we are when compared to others.After watching this 1/2 hour documentary I walked away very thankful for what I receive but sadden that others are struggling so badly with no easy way out of their situation. 


 In every thing give thanks: 
for this is the will of God in 
Christ Jesus concerning you.
Thessalonians 5:18



Comments

  1. I have always been horrified by the American system because I thought it discriminated against the poor. Your statistics just confirm that. We are indeed still *The Lucky Country.*

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    1. I was amazed at the wage differences after watching this , it really was depressing. I watched a documentary last year about poverty in the USA and by the end of the hour I was fuming!! The wealth of the USA is in the hands of something like 1% of America and so many think that is ok.

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  2. The minimum wage is pitiful here. But, the worst ones off are not the waiters and waitresses. I'm not saying that they have it easy, but suppose they wait 3 tables an hour and each table spends, let's say a very conservative $50, with tips running between 15% and 20%, that comes out to be more than $22 per hour. Keep in mind you tip in the USA -- it's not an option -- some people still think it has to do with service, and yes there can/should be a discretionary aspect to a tip, but you're a miser if you tip less than 15%. Don't worry, in Australia you 'tip' but it's built into the wage -- and mind you, that's the way it should be perceived here.

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    1. Youngest son works in a restaurant as a cook - he said that whilst the waiters get tips (nothing like you are talking about), those in the kitchen never get anything. I wonder what happens in the USA - are the tips shared or do kitchen staff miss out. The story also looked at a man who worked in retail and the wage he was bringing home was more than pitiful and he had a wife (with an injury who couldn't work) and 3 young children to support. It such a depressing story. We really are doing ok in Australia - however as a result of our high wagers much of our manufacturing and car industry has gone or going off shore. They simply can't compete with the rest of the world.

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  3. I am super thankful for our income. If you look at other countries too (not just USA), I think it makes you even MORE thankful for what we have. And the thing is that in Australia we not only have reasonable or good incomes, but the government social system is good, and we get good medical care. We are very blessed indeed. I have no complaints. :)

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    1. We have lots of good things going for us including no shortage of fresh products as well and a growing amount of organic foods that aren't too expensive. We are very blessed.

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  4. I watched this too and was amazed. My son whinges about his apprenticeship wage of $9.00/hr. I told him about what some Americans are earning and he was shocked too, think he might appreciate is wage a little more now :)

    Glad we live in the lucky country, and I hope it continues to be this way :)

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    1. I am so glad I watched the documentary as it put things in perspective for sure and made me think about our own situation how how thankful I should be.

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  5. As a US citizen I'd like to make a few comments.

    First, I think the stats about $2.13 minimum is for tipped restaurant employees, not all restaurant workers (cooks, clean-up, fast food places, etc.) We don't tip at fast food places generally. And, the stats they give seem to misrepresent the situation. You can read more about it here: http://www.dol.gov/whd/state/tipped.htm
    And here: http://www.dol.gov/whd/regs/compliance/whdfs15.htm
    It seems pretty clear to me that the tips have to add up to the national minimum wage ($7.25) in order for the employee to reduce the wages to $2.13. In other words, they are still making $7.25 *total* earnings including both the tips and wages. And the employees are not allowed to withhold more and drop that below $7.25. Since most people pay by credit and add the tip to the credit card bill, it is easy for the employer to track the tips these days.

    Whether $7.25 is enough for minimum wage in our inflationary economy is another story altogether. I'm just saying that the stats they gave on the documentary were apparently misleading.

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    1. Secondly, this statement is not as clear as it sounds from our perspective, "Close to 50% of Americans are working and are economically insecure. And that means they can’t afford their housing, their healthcare, their childcare, their transportation."

      The financial situation here is bad. No doubt about that. People are struggling. We know some who are. _But_, there are many Americans who have bought housing well beyond their means (big houses have been a real "fashionable" trend among the middle class). With rising costs and lower wages they are having trouble making ends meet. And, too many are not willing to give up their privileges and luxuries and live more within their means. Although, I think it is improving.

      Added to that, our healthcare is unneedfully costly due to a lot of complications in the system. It needs to be redone, but the solution we're supposed to be getting is only making it much, much worse and more costly. Also, we're encouraged to have a lot of healthcare type "check-ups" and procedures that are not entirely necessary.

      Childcare is a dilemma. Grandmothers who provided lower cost childcare in the past are often out working now, either because they desire the income for their lifestyle, or they really need it.

      And, Americans are not particularly good at carpooling. Also, the idea that "we need a new car" every couple years has been drummed into the population by the auto industry. Plus, many people (including us) don't want to live in the city near their jobs. Housing is cheaper outside the cities and suburbs.

      So, these are just some observations from inside this culture. The situation is bad enough, but somehow it doesn't seem as bad as that program made it sound in light of what we know to be true from our perspective.

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    2. In the first comment I meant to say - And the _employers_ are not allowed to withhold more and drop that below $7.25.

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    3. Similar to the USA, people often buy houses they shouldn't and then struggle to pay leading to mortgage stress which is what some of those 50% would be suffering from. As to childcare, families do get assistances up to around $11,000 per year to help with the costs.

      I think though when we compare the USA to Australia we are far better off, even whilst we have expensive childcare, our petrol is more expensive and housing is more expensive - but we earn far more and have far better conditions in the workplace. Whilst some are over their heads in mortgages and other costs - I do think many more Americans are struggling and are already living in very poor conditions.

      Interestedly, many double income families are not rolling in cash or take big expensive holidays (some are of course) - but most are just keeping their heads above water and have very little savings in the bank.

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    4. There is certainly no doubt that the U.S. is in serious trouble in the financial realm - both as a nation and many families and individuals. It's extremely sad and discouraging. I hope that some of the families and individuals are waking up.

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    5. So many young people want to walk into a house full of new furniture and technology and not willing to work hard and take their time. Credit and debt has to be paid back at some point - it isn't free money like some people treat it. It took us years to get a new kitchen and its only now that we are able to buy the more expensive things for the house. I think we appreciate these things more as its taken much longer to get to this point.

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