Thousands of low-wage health-care workers in the Philly region got a raise in January, and more will follow next month.
Employees such as food-service staffers, custodians, and patient service reps at five area hospitals will be making at least $15 an hour.
It started in November with Cooper University Hospital in Camden. The news came as New Jersey lawmakers considered raising the hourly minimum wage to $15 statewide (which they did this month). This would amount to $31,200 for a full-time worker.
At the time, Cooper chairman and power broker George E. Norcross III asked his fellow hospital executives across the region to follow suit.
“It is inconceivable to us that we would continue to promote the health of our patients, but neglect the health of our own staff," read Norcross' letter to hospital CEOs, which was sent with Cooper’s news release.
It’s unclear whether it was because of Norcross, but several of the region’s biggest health systems started making announcements of their own. Jefferson in Philly, Virtua in South Jersey, and Christiana Care Health System in Delaware all announced minimum-wage increases by the end of 2018. Last week, Main Line Health jumped on board. (Christiana’s wage increase goes into effect Feb. 1; the rest started in January.)
These are some of the largest employers in the region. Christiana, which employs 12,000, is Delaware’s biggest private employer, while Jefferson, which has grown to 30,000 employees in a series of acquisitions in the last few years, is among the largest in Philly.
Health systems around the country — in such states as North Carolina, Ohio, and Illinois — are raising their minimum wage, too, though not all of them are hitting the $15 mark and some will make the change over the course of a few years.
But how does $15 really compare in today’s economy? It’s more than twice the federal hourly minimum wage of $7.25, which is also Pennsylvania’s minimum wage. (New Jersey’s law will get workers there by 2021.) And although labor advocates and Democrats have championed this hourly rate for years — most prominently in the “Fight for $15″ — more recent studies have shown it still doesn’t keep up with the cost of living. It’s not enough, for example, to afford a two-bedroom apartment in Pennsylvania, New Jersey, or Delaware, according to a report last year by the National Low-Income Housing Coalition.
Here’s what else you need to know about the trend.
These wage increases will likely affect black and Latina women more than any other group
Nearly 50 percent of black or Latina female health-care workers earned less than $15 an hour in 2017, according to a new study by Kathryn Himmelstein and Atheendar Venkataramani of Penn. They also found that 1.7 million female health-care workers and their children lived in poverty in 2017, which includes those who work for largely low-wage employers such as home health care, nursing homes, and residential care facilities.
This is about hiring
In his letter to health system executives, Norcross wrote that raising the minimum wage for 750 workers, or about 10 percent of its staff, would save Cooper money in the end by helping attract workers and reducing turnover. At any given time, Cooper has 600 full-time, part-time, and per diem positions open, said spokesperson Wendy Marano.
Now, while unemployment is low and the health-care industry continues to grow, $15/hour might be the necessary rate to get workers in the door and keep them, said New Hope-based health-care consultant Joshua Nemzoff. Everybody is important in a hospital — not just the physicians and the nurses — so it’s a business move to prioritize retention. One union official put it this way: Do you really want someone who’s getting paid $8 an hour to clean the room where you’ll be getting an operation?
And yet, not all workers have seen these market forces reflected in their pay
Although most members of District 1199c of the National Union of Hospital and Health Care Employees, which represents thousands of service workers at such hospitals as Temple, Children’s Hospital of Philadelphia, and Hahnemann, have been making more than $15 for years, many non-unionized workers — some who have been working more than a decade at hospitals — are still getting paid less than $15/hour, said Chris Woods, vice president of District 1199c.
It’s one of the reasons his union has seen lots of interest from healthcare service workers hoping to organize. For example, more than 200 workers — housekeepers, certified nursing assistants, dietary workers — at Frankford Hospital, now owned by Jefferson, voted to unionize with 1199c on Dec. 5.
At Chestnut Hill Hospital, which is owned by Tower Health, the subcontracted dietary and housekeeping workers represented by SEIU Healthcare PA make between $10 and $11 an hour.
Tower Health, CHOP, and Temple are among the major health-care employers that have not raised their minimum wage. Penn Medicine instituted a $15 minimum wage in 2016, said Patrick Norton, vice president of public affairs.
It’s not a huge financial lift for health systems
For most of the health systems, raising wages for 10 percent or less of their staff is a small part of the budget, Nemzoff said. Most Virtua staffers who got a raise to $15.15 were making $10.61 before, said spokesperson Daniel Moise. At Jefferson, workers were previously making $10.50 to $14, spokesperson Jessica Lopez said.
Plus, Nemzoff said, it’s more expensive to pay temp workers from a staffing agency to fill open positions.
Nemzoff, who specializes in mergers and acquisitions, said that a $15 minimum wage would not affect a buyer’s decision to acquire.
So what about unions?
Raising wages is one way to keep workers from wanting to unionize. If they’re happy, they’re not going to call a union. “You’re going to see employers try more tactics to keep [unions] out," Woods said.
And what about subcontractors?
None of the health systems that raised their minimum wage extended the benefit to subcontractors, who are among the lowest paid at hospitals at $8 to $10 an hour. (This also could mean employers push more workers into contract positions to avoid paying minimum wage.) The health systems declined to share how many subcontractors they employed.
Philadelphia Media Network is one of 21 news organizations producing Broke in Philly, a collaborative reporting project on solutions to poverty and the city’s push toward economic justice. See all of our reporting at brokeinphilly.org.