Philanthropy New York Supports a True Cost of Living Standard and Wage Equity
Statement:
Philanthropy New York advocates for a “true cost of living” standard in New York City and believes that this standard should inform wages for all New York City workers, especially those employed in the nonprofit sector and those whose work is funded by government contracts.
Background and Current State:
In 2016, New York City increased the minimum wage to $15 an hour. Since that time, the cost of living has continued to sharply rise in the second most expensive city in the United States. According to the Living Wage Calculator, current living wage calculations in New York City for a single adult start at $25.42 an hour. Therefore, workers employed full-time at $15 an hour earn insufficient income to meet minimum standards for food, housing, medical care, clothing, and transportation.
According to the New York City Comptroller, nonprofits employ 18% of the New York City workforce. Yet, the Human Services Council notes that nonprofit health and human service workers, whose salaries are often set by City contracts, earn 29% less than government workers and 18% less than private-sector employees in similar roles. As a result, almost 25% of all human services employees qualify for SNAP benefits. An analysis by the Center for New York City Affairs found that the human services contract workforce is staffed predominately by workers of color (75 percent) and women (70 percent). Therefore, the current wage floor not only limits these workers’ access to basic needs such as housing and healthcare, it also perpetuates and exacerbates a stark racial and gender wealth gap in New York.
Justification:
Philanthropy New York’s public policy work intends to create a stronger operating environment for nonprofit grantee partners and a more racially equitable, democratic, and sustainable New York. A living wage standard and equitable pay for nonprofit workers are critical to addressing the gendered and racialized pay and wealth gap in New York City and ameliorating many of the poverty-driven issues that Philanthropy New York members address in their grant-making. A “true cost of living” measure that tracks the actual cost in New York City of meeting essential needs, including housing, food, childcare, transportation, and other necessary costs, without consideration of public, private, or informal assistance could inform critical programmatic, policy and contracting decisions. Using this measure to guide contracting for all City services, including health and human services, would ameliorate the racial and gender wealth gap experienced by many New York City workers. Ensuring that employed individuals are able to maintain a basic standard of living would significantly increase the impact of Philanthropy New York members’ grant-making strategies.
Action:
Philanthropy New York supports the creation of a living wage standard and believes that it is critical to take incremental steps by advocating for policies that increase the wages of nonprofit workers.
Affirming this Public Policy Statement will potentially allow Philanthropy New York to support issues such as:
- The New York City Racial Justice Commission’s Proposed Charter Amendment to the City Charter requiring the City to create a True Cost of Living measure to track the actual cost in New York City of meeting essential needs. This proposal will require City government to develop and report, beginning in 2024, an annual “true cost of living” measurement of what it costs to live in New York City without consideration of public, private, or informal assistance. The “true cost of living” measurement would be reported in addition to standards that are used to measure poverty or set eligibility for public benefits. It would not create a direct or indirect right of action.
- The passage of New York State bill A07503B which will increase the minimum wage to $20.45 by 2025.
- The Just Pay Campaign’s proposals of a $21 an hour floor for health and human services contracts and an automatic annual cost-of-living adjustment (COLA) on human service contracts.
- Other measures introduced at the City, State, and Federal levels that address the need for a “true cost of living” standard and equitable wages for workers.
Approved by the Public Policy Committee: September 9, 2022
Approved by the Board of Directors: September 27, 2022