Letter to the Editor: Lakewood Salaries and Employment Economics

I know that when I fall into a bit of a blogging funk, I can always count on the Yated to print something interesting. This week is no different.

Here's a letter to the editor titled "What A Joke." Any spelling errors or typos are my own.

Dear Editor,

I must say that the salaries that women receive in the city where I live - Lakewood, New Jersey - are pitiful. It is a disgrace that they get little more than $10 an hour. I am not sure what the situation is like in other places such as Brooklyn, Monsey and the Five Towns, but in this city, where so many upstanding people are struggling financially, it is simply disgraceful that our wives can't find jobs that pay decently.

Some people now highly regret that their wives, when they were single, didn't get some sort of degree to enable them to get jobs that pay decently. I don't want to get into a whole discussion about whether a girl should or shouldn't get a degree, because that really isn't the point here. The point is that, in a city where the concept of "hashkafaToraso umnaso" can be applied to so many people, the fact that wives can't earn a half-decent salary to keep their families afloat is a serious problem that has not been discussed sufficiently. In most cases, even where the husband is the primary breadwinner, the family needs the mother to earn a decent salary to help cover ever-growing expenses.

In Lakewood, apparently, $10 an hour is supposed to cut it.

$10 an hour is what you give the guy off the street who you hire to clean your backyard.

$10 an hour is what you give Maria, your cleaning lady, for scrubbing your floors.

Because of the large number of young (and not-so-young) married wives who need jobs, storeowners and business owners can - and do - dictate how much they will pay their employees. And let me tell you, they are taking full advantage of the situtation. I know of two companies that are seriously contemplating moving to Lakewood for one reason only - cheap labor.

Not Mexican cheap labor.

The cheap labor of our neshei chayil, who can be hired for "bubkis."

It's a shandeh.

Eli Parkowitz

Here's my response:

Dear Mr. Parkowitz,

I can certainly understand the frustration that you and other people in the Lakewood community are going through in your efforts to raise your families. Gas prices have shot through the roof, food prices are up, and it seems that even the basic necessities are now more expensive than they've ever been. While this is certainly true in most places, it must be impacting the Lakewood communtiy all the more, considering how many of the residents are involved in full-time Torah study. I wish you and all the Lakewood families much hatzlacha in being able to support your families.

Now then, however, I do feel that there are several things that need to be pointed out about your letter. You don't state in your letter what type of work the wives in Lakewood are looking for, but my guess is that it is largely unskilled labor. The wages for unskilled workers will, of course, usually be lower than that of skilled workers. I highly doubt the doctors, medical technicians and computer programmers in Lakewood are earning only $10 an hour.

You have to understand that companies do not exist in a vacuum. Companies that employ workers usually have to compete with other companies who provide similar or identical products or services. In order for a company to exist, it must remain competative with others in their field. If I produce widgets at $10 each and my competitor comes along and is able to produce them at $8 each, I will have to do one of two things -- a. find a way to produce my widgets at a similar cost or b. go out of the widget business.

As such, if the women in Lakewood earn $10 an hour, it is because that is what the market will bear. Employers have to find people that will do the job properly at the lowest cost. If I need a secretary (a common example of an unskilled laborer) I will find one that can do the job at the lowest cost. If your wife doesn't want to work for $10 an hour, but I know that there are ten other candidates who will, then there is no reason for me to hire your wife.

In short, if I'm paying $10 an hour for a secretary, it is because of the following two reasons:

1. There are enough candidates who are capable of and willing to do the job properly for $10 an hour.

2. If I only offered $9 an hour, the candidate pool would shrink to the point where it would be too difficult to find someone who can or will do the job properly.

Now, don't get me wrong, I'd love to hire your wife at $20 an hour and help support your Torah lifestyle. But (and forgive me for saying so) the marketplace doesn't care about your Torah lifestyle. My competitors (many of whom are not Jewish) don't care about your Torah lifestyle either. They're not going to raise thier prices to match mine because I have the extra cost of hiring a Lakewood wife. Since they're not going to raise their prices, I can't afford to pay extra to hire your wife. To do so would make my company uncompetative.

Now then, is there any solution? Of course there is. While we all recognize that our parnassah comes from HaKadosh Baruch Hu, we also all recognize the fact that we have to put in the proper hishtadlus. And that doesn't just mean showing up in the morning, doing the job and going home in the evening. It goes far beyond that.

You write in your letter that you don't want to get into a whole hashkafa debate about whether or not a girl should get a degree. But, in reality, this isn't about degrees... it's about job skills. If your wife (or anyone else, for that matter) has a valuable skill that they can bring to the marketplace, then they can command a higher salaray. The general rule is that the rarer the skill (and the more in demand that it is), then the higher the salary the person can command. In many cases this means a college degree, but it does not necessarily have to be so. Allow me to give you an example:

When I started out in the workforce, I was earning only $10 an hour. I was young and newly-married. While I had some skill at using computers, it wasn't anything terribly specialized. I knew how to use WordPerfect, Lotus 1-2-3 (am I dating myself?) and some other basic computer programs. In short, while I had some marginal computer skills that placed me higher than a "shlub off the street," I was still certainly in the category of unskilled labor. As such, I earned a meager salary for a few years.

It was only later on that I began to realize that if I wanted to earn a higher salary, I would have to make myself more desirable to employers. So, I went out and learned some computer skills that are more uncommon. I went to an adult education center and, for the next year, took eight courses in computers covering programming and databases. As a result, because I invested in my human capital, my value in the market place went up and I was able to command a much higher salary.

Human capital is basically what you have if you were dropped off on a street corner with nothing more than the clothes on your back. Just to give you an example (albeit an extreme one), consider what would happen if two people were put in that situation. Let's suppose that Bill Gates and I were both stripped of all our possessions. He loses his billions, his mansion, his Microsoft stock -- everything. Me -- well, I lose my house, whatever savings I have in the bank, my 401(k), etc. We're both dropped off on a street corner with nothing more than the clothing we're wearing. Which one of us will be better able to provide for our families? The answer is Bill Gates, because he has more human capital than I do. He has skills and contacts that I don't have. He has years of experience in running a multi-billion dollar corporation. I don't. The combination of skills, contacts, experience that he has is worth far, far more on the labor market than mine. As a result, he will (in all likelihood) find a job faster than I and earn a higher salary than I.

The best way to improve your earnings for the long term is to invest in your own human capital. Tell your wife to go out and learn a skill that will make her more valuable to employers in the Lakewood area. That's the *best* way to ensure that she will be able to command a higher salary. Is it a quick fix? No, of course not. It takes time and money. It took me over $5,000 and a year to take the computer courses I mentioned above. It was very difficult -- my family had to make significant sacrifices for me to be able to scrape together the money for those courses. However, with the higher salary I was able to command when I finished, I earned the money back within a year. I'm now further investing in my human capital in two ways: a. I'm always looking to improve my skills at a database administrator/programmer and b. I'm going back to school for an advanced degree. You can rarely go wrong by investing in your human capital.

If you want your wife to earn more than "bubkis" then she has to be able to bring valuable skills to her employers. However, if she is indistinguishable (in a professional sense) from thousands of other women in Lakewood, then no employer can pay her more. She has to work on setting herself apart from the crowd. There's a reason that Maria only earns $10 an hour -- because anyone can learn very quickly how to scrub floors. Likewise, almost anyone can learn very easily how to answer phones. It's only when the skills become rarer and more valuable that the salaries start to rise.

Wishing you much hatzlacha,

The Wolf