Jonathan M. Ruga and Scott F. Young: Pandemic the perfect time to increase wages

(Antonio Perez | Chicago Tribune via AP) Protesters rally outside a McDonald's in Chicago to demand $15 per hour pay, Wednesday, May 25, 2016 in Chicago.

At the end of this month, thousands of Utah workers will have to choose between their health and their livelihoods as the $600 boost to unemployment benefits instituted by the CARES Act are set to expire. For many out-of-work Utahns, the bonus unemployment checks made the difference between affording basic necessities and being destitute.

With no indication from Senate Majority Leader Mitch McConnell that he will let the Senate vote on whether to renew the legislation, families across Utah are facing the prospect of having to live off poverty level wages that will leave them even more vulnerable and ill-equipped to handle the pandemic than they already are.

Returning to work before the number of COVID-19 cases starts to meaningfully drop comes with a much higher risk of getting infected and bringing the disease home to your loved ones, and far too many will be forced to make this devastating choice. Until now, the unemployment benefits that McConnell is likely to let lapse are what have enabled millions of Americans to avoid making that choice. Thanks to the additional benefits, two-thirds of those on unemployment are now earning more than they made while working; in some cases it’s up to two to three times more. While every state offers a different amount of unemployment benefits, here in Utah, the federal boost has increased wages to a little over one and a half times the average wage prior to the pandemic.

Some businesses have complained that their employees are delaying their return to work because their unemployment benefits exceed their wages at work. While that may be true in the short term, it is also true that this crisis – and the government’s response to it – has illuminated the fact that many employers are simply not paying their employees a livable wage.

Unfortunately, being underpaid isn’t anything new to countless workers here in Utah. For decades, the average compensation a worker receives has drastically fallen short of the actual productivity of their work, and their lived economic experiences reflect this. Nearly half of all Utahns currently make less than $15 an hour and 26 percent of working families live in or near poverty conditions. But it’s not just here, across the nation 78 percent of workers are living paycheck-to-paycheck and one in four adults has foregone medical care because of the inability to pay for it. Millions of Americans have attempted to subsist on poverty-level wages amid continuously rising costs of living. The current crisis has only exacerbated their daily challenges.

Essential workers who are putting their lives on the line during the pandemic are not benefiting from expanded unemployment benefits and many are earning ‘normal’ grossly inadequate wages. Some grocery stores have offered their employees a hazard pay bonus, but many of them have subsequently withdrawn that increase, even though the crisis rages on. This is precisely why the Senate should pass Sen. Sherrod Brown’s plan to give essential workers an extra $13 dollars for each hour they work through the end of 2020. Paying those who do the work that keeps our nation running is not only the right thing to do, it’s also how we create a more prosperous economy.

It will take years for the U.S. economy to recover to pre-pandemic levels, and the best way to quicken the pace of recovery is by paying low-income workers more than minimum wage. Unlike wealthy people like us, most people who work for a living spend their extra cash rather than investing it. Higher wages won’t be buried in the backyard or stashed under the mattress; rather, they will quickly be spent on food, clothing, rent, medical care and other bills. Consumer spending accounts for about two-thirds of our economy, and if a large swath of our population struggles to make ends meet, our economy falls flat. So rather than hiding tax cuts in relief bills that will help the rich get richer, Congress should focus on passing the $15 dollar an hour national minimum wage bill that’s currently gathering dust on the desks of Sens. Lamar Alexander and Mitch McConnell, so we can put cash in the hands of those who need it the most.

How quickly our economy will recover cannot be precisely forecasted. But we can say with certainty that if millions of workers are in or on the brink of poverty, our economic woes will be dragged out. We need solutions like Brown’s essential worker pay and a continuation of the federal unemployment bonus to ensure that no one falls through the cracks during this crisis. And we also need a permanent $15 dollar per hour minimum wage to give American workers the opportunity to make ends meet and, perhaps, to have a realistic chance at living the American dream.

Workers in Utah and throughout the country realize how distressingly low their wages are compared to the cost of living. It is high time that employers and legislators recognize it too. Utah Senators Mitt Romney and Mike Lee can start by taking the lead in the Senate to pass the Raise the Wage Act and to address Americans’ wages in the upcoming COVID-19 relief legislation. Let’s finally give Utahns and hardworking Americans across the country the wages they have earned and deserve.

Jonathan Ruga

Scott Young

Jonathan M. Ruga and Scott F. Young are members of the Patriotic Millionaires, a nonprofit group which promotes, among other fair policies, providing a sustaining wage for working Americans. They are co-founders of Sentry Financial Corporation, Salt Lake City, Utah, and allocate significant time and resources to addressing the needs of vulnerable populations in our communities.