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Paying Fair Wages (Part 2/2)

Yesterday we saw that the top wage for food service work in Hanover was about $12.00/hour: that amount might be paid in cash, or in combination of cash and vacation and health benefits. If you look at the average wage scale in the Upper Valley, the people at Penn State’s Poverty in America project don’t paint such a pretty picture. They pin wages for food service workers at $9.29/hours, and because we are looking at Dartmouth wages today, let’s note that in the Upper Valley janitorial work comes in at $11.29/hour.

Living Wage Local Wages.jpg

In my own experience, unlike the Dirt Cowboy, most of these jobs offer a couple of weeks of paid vacation and some contribution towards health insurance.

What does Dartmouth pay for similar work? Here is the fiscal 2013 SEIU wage scale. Food service workers fall into category A and custodians are in C:

SEIU 2013b.jpg

Yikes. We are paying food service workers and custodians — who don’t even require a high school diploma to get their jobs — $16.78/hour and $17.99/hour. To that you can add a shift differential: $0.85/hour for second shift and $1.15/hour for third shift.

But then the fun really begins. All SEIU workers at Dartmouth get a pension contribution on top of their salary. The amount varies by age:

Age 21 through age 29 - 3% of salary
Age 30 through age 34 - 5% of salary
Age 35 through age 39 - 7% of salary
Age 40 and older - 9% of salary

After that, all workers get paid holidays and personal time. Starting workers get approximately five weeks of paid time off in their first year (including the Christmas-New Year’s break), and that amount rises progressively to eight weeks for employees with more than twenty years on the job.

And then there’s Dartmouth health insurance, and what insurance it is! Eight personal counseling sessions per year, fertility treatments, and on and on. This type of plan has been given a generic name by the Obama administration: Cadillac heath care. We can call it something else: very, very expensive.

And what do Dartmouth’s workers contribute to it? In short, not a lot: for a health plan with a high deductible, a Dartmouth Category A cook helper contributes $10.91/month, and custodians contribute $24.58:

Dartmouth Healthcare Calculator.jpg

Recall that Starbucks employees contribute $140/month for a, um, non-Caddy plan. Dartmouth’s plan for a single worker could require a contribution from the College of as much as a $6-8,000/year.

When you sum this all up: high base wages, long vacations, generous pensions contributions and Cadillac health care, it’s not hard to conclude that our cook helpers and custodians cost the College twice as much workers doing the same job on Main Street in Hanover. Multiply that out by 520 SEIU workers, and extrapolate to Dartmouth’s remaining 2,500+ full-time, non-faculty workers, and you can come to understand why our tuition, room and board, and fees is the second highest in the Ivies at $60,201.

Now don’t get me wrong. It’s nice that people get paid good salaries. But this kind of generosity has led directly to the high cost of a Dartmouth education, the awful performance of our endowment since 2000, and the cash-strapped state of the College (ask any professor you happen to see how easy it is to unlock some money for a new project).

To put it another way, this kind of generosity explains why Dartmouth needs $105,491,000 more each year to meet its expenses than Brown, even though Brown has 36% more students than the College and it does business in high-cost Providence, Rhode Island.

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