Ikea, the world’s largest furniture retailer, recently announced that the average minimum hourly wage in its 38 existing US stores will rise to $10.76, an increase of 17% and $3.51 above the federal minimum wage.
The hourly wage will vary according to the cost of living in each IKEA location. And the company will determine the rate using the MIT Living Wage Calculator, the creation of MIT professor Amy Glasmeier.
The federal minimum wage is $7.25. The living hourly wage for a family with two adults and one child in Ludlow Falls, Ohio? $15.98, according to the calculator. In Washington, DC? $23.54.
A professor of economic geography and regional planning, Glasmeier released the first version of the calculator in 2004. For counties, cities, and towns in all 50 states, the tool lists typical expenses, the living wage, and typical wages for a selected location.
Glasmeier told the radio program Marketplace that she is the kind of person who, “when she goes on a trip somewhere, is less likely to head to the tourist attractions and more likely to drive to a grocery store where she can squint at price tags to figure out what it costs to live there.”
Her obsession with the expenses of daily life has a serious purpose: establishing a living wage, an approximate income needed to meet a family’s basic needs, would enable the working poor to achieve financial independence while maintaining housing and food security, according to the Living Wage Calculator website.
In her interview with Marketplace, Glasmeier is careful to point out that living wages are not middle-class wages. “They wouldn’t cover a trip to Hawaii once a year or saving for retirement,” the story states. “The living wage is … just enough to pay bills for the necessities of life and not fall behind.”
Visit the Marketplace website to read the full story, or listen to the broadcast below.