Crea Purchasing Power Index Methodology &
Standards for Determining a Sustainable Living Wage / Income

"Everyone who works has the right to just and favorable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection." Universal Declaration of Human Rights. United Nations. 1948. Article 23

I. Introduction

SUSTAINABLE LIVING WAGES AND INCOME

Oftentimes discussions and deliberations regarding wages revolve around raising the minimum wage. In a globalized economy where the race to the bottom oftentimes seems to be gaining speed and momentum, CREA believes that it is critical that we raise the questions of social and economic sustainability and of human rights as we see the effects of wages and income on the lives of workers, their families and their communities. Often concealed within the data of globalization, profit and growth are the faces (and hearts and hands and minds and lives) of the workers on whom this globalized economy depends.

THE PURCHASING POWER INDEX (PPI)

As we shall see, the Purchasing Power Index (PPI) methodology allows us, as researchers, to enter into the very intimate aspects of human life: the kind of homes one lives in, the food one eats, the clothing one wears, the education of one's children, the hopes and dreams for the futures…and the planning and saving that makes those dreams possible. The PPI is grounded in reality, in multiple realities in many parts of the world. Whether we are in Haiti or Mexico, in El Salvador or the US, in Kenya or China, human needs are the same. What differs are the culturally determined ways in which those needs are met.

The PPI looks at the costs of what is needed and the income that is needed to generate the purchasing power required to buy those items. It then examines the wages (when a person works for someone else) or income (when a person is self employed) that are needed to earn sufficient purchasing power. At any wage or income level, with benefits subtracted and bonuses added, any worker, anywhere in the world, earns just so many minutes of purchasing power. Those minutes of purchasing power are what any worker has to pay the costs of meeting his/her own needs and those of her/his family.

When purchasing power is not sufficient, something has to give. Needs are not met. The family does without. Without a decent house to live in or nutritious food. Without the kinds of clothes that symbolize a decent life. Without decent health care or transportation or so many things that provide for health and security. What they don't give up is their dream of a better life.

A job that provides a sustainable living wage or sustainable living income would make that dream possible. Why is it so elusive? Why is it not the standard upon which economic systems are built in any country, any place around the world? To work for economic justice as we do at CREA requires that we believe that change is possible. Changing hearts, changing minds leads to ideas and the collective will to change systems.

Ruth Rosenbaum, TC, PhD

II. Purchasing Power Index Methodology

The creation of the Purchasing Power Index for a particular community or country starts with a standard market basket survey similar to the standard tool used in the formation of the Consumer Price Index (CPI) each month, quarter and year in the United States by the Department of Labor or the Market Basket that s used in many other countries. The CPI (or its parallel in other countries) is calculated after the prices for a given set of items (the "market basket") are researched throughout set locations in a country on a regular basis. The increase/decrease in the price of the items in the market basket is what determines the CPI amount.

Taking the market basket survey concept a few steps further, the Purchasing Power Index calculates the intersection of wages and prices documented through actual pricing and interviews, while evidencing the effects of inflation as experienced in different geographic areas within a country. It calculates the cost of items in terms of the minutes of work at specific wage levels that are required to purchase a specific item. This is called minutes of purchasing power, or minPP.

The actual pricing lists contain extensive lists of commodities, both consumable and non-consumable. The lists go beyond the contained lists of the "market basket". The specific country or community lists are created in collaboration with individual workers and their organizations, and with other NGOs working with them. The lists are not minimalist in that they do not contain the bare minimum that a worker might need in order to survive. The Purchasing Power Index is based upon the belief that all workers, along with their families and dependents, are entitled to a living standard that reflects the basic dignity accorded to all human beings.

The standards set forth in the Purchasing Power Index incorporate the following:

1. Nutrition rather than mere calories

2. Social, cultural and religious norms appropriate to a given country, region and group of people

3. Educational needs

The PPI methodology assists those who use it to move beyond the questions of "Isn't any job better than no job?" and/or "Isn't this living standard better than what workers had before?" Neither question should be used as an excuse to make acceptable low wage standards and/or the exploitation of workers. While it is true that any job (with some notable exceptions) is better than no job, that should not be used as a reason to dignify low wage levels as appropriate, acceptable or just. Those who work expect that one of the results of that work should be the ability to better one's own standard of living and those of one's family and dependents.

ADVANTAGES OF THE PURCHASING POWER INDEX (continued)

The PPI...

  • allows for specificity and comparison over time.

Future studies can provide data in the same form: minutes of purchasing power required (minPP.) The minPP reveal the progress or decline of workers in their struggle to meet basic needs.

The PPI...

  • is inclusive of foods and other items particular to any group within any local population, because it is based on actual pricing/shopping
  • allows for the cost of community or cultural demands in a worker’s life to which s/he is required to contribute.

The PPI...

  • is based on affordability, not what is chosen for purchase. It states what is possible in terms of the purchasing power accruing as the result of a normal workweek.
  • removes the question of judgment of values involved in decisions as to how one spends one's money.

The PPI...

  • creates a means of comparing the purchasing power earned by workers/employees at different wage levels, including management wage levels.
  • allows comparison of the effects of wages paid by different employers whose workers do the same work.

The calculations of the PPI start with the current minimum wage. The calculations can be done for increasing wage levels. For each item priced, the cost in currency is translated into the cost in minutes of Purchasing Power (minPP) required for the purchase. Since each week contains a limited amount of minutes, the calculations reveal both the type and quantity of items that are affordable for a worker. In this way the purchasing power generated by actual wage levels can be determined. In addition, the effects of any specific wage scale upon the life of the worker, his/her family unit as well as the community can be clarified in an objective manner. The emphasis is on affordability with choice left to the worker.

The next stage calculates what would be a sustainable living wage in a specific geographic area. CREA does not use the expression "living wage" since a corporate official in one country stated that the wage paid was a "living wage" because the worker was living. We then used the expression "sustainable wage." This we amended to "sustainable living wage and/or sustainable living income" to signify a wage or income standard that reflects the needs and tights of workers to a dignified living standard, and the ability to move beyond only immediate necessity to planning for the future.

The PPI changes the context of the expression "minimum wage." These questions can then be raised.

  • Minimum in terms of what context?
  • Is a minimum wage the minimum amount that a person needs to survive?
  • Is it the minimum established by the local governing power as the least amount that the employer is obliged to pay the employee?

The Purchasing Power Index provides precise calculations accepted by corporations, non-governmental organizations, religious investors and other members of the socially responsible investing community as well as by the workers themselves. It is accepted as a tool that enables them to accomplish something else: to illustrate the reality of workers and their families anywhere in the world. The data that the PPI provides is an objective foundation for negotiations to adjust workers' wages or income to the sustainable living wage or sustainable living income (SLW/I) level.

EARNING PURCHASING POWER

One of the great limitations that affect all human beings is that of time. We cannot earn, buy, or make more time, no matter the wage or salary scale upon which one's income is based. That is as true for us as it is for factory workers, for coffee cooperative members or crafts makers. Time is the true limitation of all human beings.

Purchasing power is based on the concept of time. The Purchasing Power Index (PPI) translates costs into units called minPP or minutes of purchasing power. The minPP unit is based on the 60 minute per hour standard.

Any worker paid for working a:

  • 40-hour week - earns 2400 minPP per week
  • 45-hour week - earns 2700 minPP per week
  • 48-hour week - earns 2880 minPP per week

The earning of purchasing power can be calculated for any number of hours per week, as long as there is payment for the hours. Therefore when salaried workers work overtime and do not receive extra compensation they do not earn additional purchasing power. What varies as wages, prices and/or inflation increase or decrease is the cost in minPP for any item that needs to be purchased.

Therefore, to determine a Sustainable Living Wage or a Sustainable Living Income, each and all of the necessities of a worker and his/her family must be obtainable through the purchasing power that the worker's wage provides.

  • meets present basic needs, including health care and education
  • provides ability to participate in culturally required activities such as births, weddings, and funerals.
  • allows for savings for future needs

The Purchasing Power Index (PPI)

  • calculates the minutes of work at a specific wage that are required to purchase a specific item
  • is expressed in minutes of purchasing power, or minPP

The 40-hour work week results in 2400 minutes of purchasing power (minPP) earned in a given week.

The 50-hour work week results in 3000 minutes of purchasing power (minPP) earned in a given week.

Any change in wages and/or prices and/or inflation changes the number of minutes of purchasing power required for any item.

III. STANDARDS FOR A SUSTAINABLE LIVING WAGE/INCOME

The Purchasing Power Index uses set standards for determining the Sustainable Living Wage or Sustainable Living Income in each country and community where the standards are applied. The standards have been set for the following categories:

  • Housing and related costs
  • Non-Consumables
  • Clothing
  • Nutrition
  • Education
  • Water - Potable and Non-Potable
  • Personal hygiene and basic health care
  • Transportation

Housing and Related Costs

Housing and related costs are often the highest costs to the worker and the worker's family. These are costs that MUST be paid if the family, no matter how large or small, is going to live and function as a unit. There are numerous dimensions to consider when evaluating housing costs. These must be examined carefully in order to arrive at a fair understanding of their relationship to a Sustainable Living Wage/Income housing standard.

It is necessary to set the context for the reality in which many workers live. Words or expressions such as "apartment", "owning one's home", "home under construction", or "living rent-free" convey to the average person in the US a sense of living in well constructed housing units. For workers in many countries a different understanding of homes and houses is needed. The poorest urban dwellers often live in shacks made of tin or cardboard. Other families rent one-room apartments in buildings with communal facilities. Common rural homes are simple one-or two-room houses made of branches woven together and covered with mud, with dirt floor and thatched or tile roof. Sturdier homes may be made of materials such as cement blocks.

The underlying questions in establishing standards are the following: What should housing provide? For whom? Often there is an underlying assumption that as long as people are living in a situation that is better than what they had before OR allows them to be in a process of bettering conditions for themselves and their families, this is sufficient. Why should that be? Does not every worker, in return for a decent week's work, have the right to a decent standard of living?

Whether the homes are located, the standards that a home should provide are the same. They include many of the ordinary requirements for housing that are taken for granted in other parts of the world. While many workers live in homes that do not provide all of these items, that is from financial necessity, not from a free choice. Therefore, the Purchasing Power Index studies use the following housing standards.

PURCHASING POWER INDEX STANDARDS FOR HOUSING AND HOUSING RELATED COSTS

HOUSING

The house should provide:

1. Shelter from the elements. This includes walls, roof and a floor.

2. Protection from public exposure. This includes a door that locks as well as solid walls.

3. Ventilation. This includes windows that can open and shut.

4. Running water for laundry, sanitary needs and general washing of household items.

5. Adequate space to provide sleeping spaces for all members of the family as well as

6. Sufficient living space to be sheltered from rain and/or extreme heat when necessary.

7. Space for cooking.

8. Space for bathing.

9. Space for meeting sanitary needs so that there is no risk of contamination.

Housing-related Costs

Lighting

Depending on where one lives, what one is doing, the time of day, etc., lighting may come from electricity, kerosene lamps, candles or other sources. Because electricity is the preferred form of lighting, the cost of electricity will be used for the PPI standard.

Cooking fuel and stoves

Different homes have different types of fuel. Propane gas, wood and charcoal are some of the fuels used for cooking. Use of propane gas requires the purchase of propane tanks to be hooked to the stove. Each of these has costs. Some are on-going and some are a single time expense. Repair or replacement expenses are not usually part of the weekly expenses that must be met, but funds must be set aside to pay for these expenses as they become necessary. Such set-aside money is included as part of the SLW/I standard.

Water: potable and non-potable

Two forms of water are necessities: potable (safe drinking water) and non-potable. In many countries and/or communities, water that may be piped into dwellings is non-potable. Potable water must be purchased separately. It is a cost that many cannot afford. Regular piped water, provided as part of municipal services, must also be paid for unless another water source is available. Water needs to be sufficient for personal hygiene, for laundry, for household cleaning. Without sufficient water, a healthy standard of living is not possible.

Transportation

Transportation is required for several aspects of every day life. Bus transportation is often the norm in many countries, with the cost dependent on where one is going. Transportation may be required for work, for shopping, for health care. In some cases, workers receive subsidized transportation provided by the specific employers or by a specific free trade zone. However transportation for shopping and for meeting other needs still remains a cost for which sufficient purchasing power is required.

Since the normal workweek is 5-6 days, money to pay for round trip bus trips must be part of the Sustainable Living Wage Income. (SLW/I)

NON-CONSUMABLES

The transformation of a house into a home requires more than just walls, floor and roof. There are basic articles needed for bedding, personal cleanliness, cooking, eating, cleaning and laundry that transform any space into a home. These are not items that are purchased all at once. However, anyone who has set up an apartment for the first time knows the myriad items that are needed to be "at home" in a given space. We also recognize that these items, once bought, do not have to be replaced on a frequent basis. However, this list is presented as a relatively minimal list of items needed.

Bedding

For the purpose of this study, the following assumptions have been made.

1. Sleeping should not normally be done on the floor or the ground.

2. Sleeping requires some sort of bed and bedding. The bedding includes the following: pillow, sheets, pillowcase and blankets. Weather can vary, thereby requiring different types of bedding to respond to the weather. Even within a specific country, weather can vary greatly.

3. When houses lack insulation or protection from the cold, additional blankets or other items are required to provide warmth.

4. A bed requires more than one set of sheets to allow for washing. If there is more than one bed in a home, the extra set of sheets can be rotated as each bed's sheets are washed, but the extra set is necessary.

5. Children should sleep separately from their parents. This requires separate bed(s) for children.

Personal Cleanliness .

Towels are necessary for bathing. As a standard, one towel and washcloth (or other parallel item such as a sponge) should be available for each person in the family.

Cooking.

Basic cooking items include the following: large cooking pot, clay pot, frying pan, large knife, spatula and cooking spoon. In addition, bowls to mix and prepare foods are necessary. There are other items of varying sizes that families use, but the items listed are basic necessities. For each person in the family, there should be a plate, bowl, cup or glass, as well as eating utensils, including knives, forks, small and large spoons. In addition, a large bowl for setting out food is helpful.

Other Items

There are many other items that, when funds are available, help to enrich the lives of workers and their families. These include simple tools such as hammers, screwdrivers, nails, etc. that assist the worker and the worker's family in the gradual transformation of the house into a home

 

CLOTHING STANDARDS

Clothing and shoes are available in two general forms, new and used. New clothing is available from a variety of stores, both small and large. New clothing is also sold from vendors at the various markets. As would be expected, new clothing prices are many multiples of used clothing prices. Many stalls at open-air markets carry a broad variety of used clothing.

New clothing prices are collected from as many sites as possible. The new clothing items priced are for standard articles for men, women and children as well as babies. School uniform prices were also collected where the norm is for students to wear uniforms.

Clothing Standard: Each member of the family has sufficient clothing to be appropriately dressed for school, work and

social occasions.

CLOTHING NEEDS

Everyday clothing is needed as well as something reserved for church, social occasions, etc. Depending on the specific work a person does, there is a definite need for some articles of clothing reserved for "dirty work" such as construction, cleaning, etc.

Since much laundry is still done by hand in poor countries, and many women are part of the workforce, especially in the assembly plants, it is logical to say that a person, whether child or adult, needs to have sufficient clothing to get through the work or school week without laundry needing to be done. The doing of laundry requires time, good drying weather, and access to sufficient water for washing and rinsing.

The amount of clothing needed by adults is different from that needed by children. Adults do not grow while children grow continuously. In addition, children of school age need school clothes and non-school clothes as well as something reserved for special occasions. Babies and small children exhibit other needs, especially for diapers. The use of disposable diapers is commonplace. Based on these requirements, the listing of clothing below is the minimum for a Sustainable Living Wage and/or Sustainable Living Income standard.

Purchasing Power Index Standards For Clothing For Adults

For adults, the following standard is used for amounts of clothing:

  • 1 set of clothing for good wear
  • 7 shirts or blouses
  • 3 pairs of pants or skirts
  • 7 sets of underwear
  • 1 pair of everyday shoes
  • 1 pair of dress shoes
  • 1 jacket
  • 2 sweaters, sweatshirts or other light over garment.
  • 7 sets of socks

The following is used as a yearly replacement standard. To be replaced every year:

  • Underwear
  • Everyday shoes
  • Two blouses or shirts
  • One pair of pants
  • Set of clothing for "good wear" which then moves to everyday wear.

For children, the following basic clothing standards are used:

  • 1 set of clothing for good wear 1 pair of shoes
  • 7 sets of everyday clothing 1 pair of sneakers
  • 7 sets of underwear
  • 2 sweaters, sweatshirts or other light over-garment
  • 7 pairs of socks

Because children grow so fast and continually, and because they are much harder on clothes than adults, all of the above items for children need to be replaced each year, although not necessarily at the same time. In addition, school age children need school uniforms. A minimum of 2 uniform skirts or pairs of pants needs to be paired with 3 school shirts or blouses to allow for the soiling of clothes through normal child behavior.

For small children and babies, there are other needs in addition to clothing. Diapers are an on-going cost. If a child needs, on average, 6 diapers per day, the weekly requirement is a minimum of 42 diapers. (Cloth diapers for purchase could not be located.) The rapid growth of babies means that baby clothes are quickly outgrown and have to be replaced. Our standard is a minimum of 7 sets of baby clothes, even though it is possible to argue that this is a lower amount than is practical simply because of the number of times that a baby's diapers need to be changed.

The balance between buying new and used clothing seems to be determined by a number of factors:

1. Price. For the most part, prices for used clothing items are approximately 10% of the prices of new clothing items. Many families are forced to buy used clothing because of the low purchasing power accruing from he present minimum wage.

2. Condition of the clothing. The used clothing is sold with equal dignity and care accorded new clothing. In small stands in the open-air market, the used clothing has been washed, ironed and folded or hung on hangers with care so the articles are neat and attractive. Clothing with rips or damage is rarely seen. To purchase the used clothing is not seen as anything undignified or lacking in respect. More often, the attitude accorded the process and articles is that of finding a bargain.

Again, it is important to keep in mind that we are not listing what someone or some family can "get by on." The standard of the Sustainable Living Wage of the Sustainable Living Income is not one of mere survival or getting by.

THE RIGHT TO ADEQUATE NUTRITIOUS FOOD

The issue of food is perhaps the most complicated of the elements within the PPI, because it is here that we come face to face with areas that touch on how one group of people perceives other groups. To set the foundation for this discussion, we need to first decide what is the purpose of food. For the PPI, the purposes of food are as follows:

  • To provide good nutrition that allows for the development of the person, physically, mentally and emotionally.
  • To provide the nutrients necessary for good health so as to prevent nutritionally associated diseases as well as to allow for resistance necessary to combat disease.
  • To prevent malnutrition
  • To allow for the "attainment by all peoples of the highest possible level of health."

To support these statements of purpose regarding food, we turned to two types of international human rights documents. In the first group are the conventions and covenants that are legally binding on those accepting them. In the second group are the declarations that, though non-binding, provide a level of moral persuasion on governments and, by extension, on corporations. The World Health Organization (WHO) has assembled a set of statements from various international instruments that both individually and collectively provide the foundation for and the recognition of the human right to adequate food and nutrition. (www.who.int/nut/human_rights.htm)

Text Box: “Everyone has the right to a standard of living adequate for health and well-being of himself and his family, including food…” 
         Universal Declaration of Human Rights, Article 25(1)

“Promoting the improvement of nutrition (article 2) is among the highest ways that WHO can achieve its objective, “the attainment by all peoples of the highest possible level of health.”
 			                   Constitution of the World Health Organization, Article 1

“The States Parties to the present covenant recognize the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing…” 
 	                International Covenant on Economic, Social and Cultural Rights, Article 11

“Access to nutritionally adequate and safe food is a right of each individual.”
						 World Declaration on Food, Rome, 1992

“The right of everyone to have access to safe and nutritious food is consistent with the right to adequate food and the fundamental right of everyone to be free from hunger.”
			                    Rome Declaration on Food Security, World Food Summit, 1996

PURCHASING POWER INDEX STANDARDS FOR FOOD

It is therefore appropriate within the context of the PPI to work from a standard that will look at the cost of food from the perspective of meeting the nutritional needs of workers and their families within particular cultural settings. In order to do this, it is necessary to distinguish the roles that food plays in preventing hunger, in providing adequate calories and/or in providing good nutrition. To prevent hunger is relatively easy. For example, sugar water, taken at intervals, will calm the appetite and prevent the sensation of hunger. What is really happening is that the person will not have the sensation of being hungry. In poor families in many parts of the world, including the United States, it is not uncommon to see bottles of sugar water being fed to infants to still their hunger pangs and get them to sleep. (Giving Kool-Aid to children is another example of this approach to hunger.)

While this provides momentary relief from the sensation of hunger, it does nothing to assist the body in attaining the calories it needs for survival for the day. (The exception being the few calories provided by the sugar in the sugar water.) Caloric intake necessary for growth is a well-documented concept with standards existing for caloric need for all age groups, according to gender. The caloric intake standards used for the PPI are taken from the standards created by the US Department of Agriculture's Center for Nutrition and Promotion in their Dietary Guidelines for Americans

The PPI uses the standard of nutrition rather than calories. This is an important distinction. A person can achieve appropriate caloric intake through the consumption of carbohydrates. This food group is usually the cheapest form of food, it is usually the most readily available anywhere, and oftentimes what is termed "junk food" or "quick food" is high in carbohydrate content. To meet caloric needs in this way is not a health appropriate form of consumption and does not meet the nutritional standards described by the WHO or the other international covenants and agreements set forth above. The standard of nutrition assumes an appropriate balance of protein, fruits and vegetables, carbohydrates, potable water as well as sources of vitamins and minerals necessary for good health for anyone, anywhere.

Some might raise the question of the appropriateness of using nutrition standards from the US for persons and families from another country. Let us be very clear that what we are saying is that healthy nutrition standards are just that, healthy nutrition standards, and that the same standards of health need to be applied to all peoples. What will differ are the foods that are used to meet those standards. Those foods will be culturally appropriate both in terms of form and content. But the need for adequate protein, fruits and vegetables, carbohydrates, unsaturated fats, etc. remains the same for all.

Some might argue that this will require a change in eating patterns on the part of workers and their families. The only appropriate response is that much of what is seen as eating patterns is determined by access to food and the monies to purchase that food. The purpose of the PPI is to determine what income is necessary to allow for the purchasing of foods that provide adequate nutrition. How that food is prepared and served is up to the workers and their families.

 

PURCHASING POWER INDEX STANDARDS FOR NUTRITION AND CALORIC INTAKE

Using the nutritional standards established by the US Department of Health and Human Services and the US Department of Agriculture, the following energy (through calories) intake is the standard for the PPI:

Category

Age

Calories per day for moderate activity

Calories per day for heavy activity

Children

2-6

7-10

1600

2200

 

Males

11-14

15-18

19-24

25-50

2500

2800

2800

2800

3600

3600

3600

Females

11-18

19-24

25-50

2200

2200

2200

2600

2600

2800

The majority of the work in the factories would be termed heavy activity; therefore for the workdays, 6 per week, the standard for caloric intake will be 2600 for women and 3600 for men. On the remaining day that is filled with the many activities that comprise taking care of a household, the caloric intake would most probably be termed moderate. Although there are other levels of activity, the life style of the workers mandate that moderate be used to describe life without the work-saving devices that are common in the USA.

Moving from caloric needs to nutrition needs, and using the Dietary Guidelines for supplied by the US Department of Agriculture (USDA), the PPI standards use the following guidelines for servings for older children, teen girls, active women and most men on a daily basis. [Note: These nutritional guidelines are in the process of being revised according to the new 2005 USDA Nutritional Guidelines. This revision will be completed by December 2005]

NUTRITION AND SERVINGS GUIDELINES

A. 2-3 servings of milk and milk products

Serving = 1 cup of milk or yogurt, or 1.5 ounces of natural cheese

In the case of lactose intolerance, calcium rich substitutes are chosen.

B. 3-5 servings of vegetables

Serving = 1 cup raw, leafy vegetables, ½ cup other vegetables (raw or cooked)

C. 2-3 servings of meat, poultry, beans or other high protein sources

Serving = 2-3 ounces cooked meat, poultry, fish or ½ cup cooked dry beans,

1 egg or 2 tablespoons peanut butter or 1/3 cup nuts = 1 ounce of meat

D. 2-4 servings from the fruit group

Serving = 1 medium apple, banana, orange or pear

½ cup cooked, canned or chopped fruit

¾ cup fruit juice

E. 6-11 servings from the bread, cereal, rice, pasta group.

Serving = 1 slice bread or 1 tortilla or ½ cup cooked rice or pasta


To explain the servings described above, the following chart is provided from the same sources:

How Many Servings Are Needed Each Day:

FOOD GROUP

Children ages 2-6, Women,

Some Older Adults

(about 1,600 calories)

Older children, Teen Girls, Active Women, Most Men

(about 2,200 calories)

Teen Boys,

Active Men

(about 2,800 calories)

Grains Group

6 servings

9 servings

11 servings

Vegetable Group

3 servings

4 servings

5 servings

Fruit Group

2 servings

3 servings

4 servings

Milk Group

3 servings

3 servings

3 servings

Meat & Beans Group

2 servings = 5 ounces

2 servings = 6ounces

3 servings = 7 ounces

For the purposes of establishing sustainable living wage standard, we use a balance of items from each of these food groups.

Foods are purchased from a variety of places. Each of these provides a range of prices. Where someone will shop for food depends on several factors:

1. How much money does the shopper have to spend at a given time?

2. What items need to be purchased?

3. How much time is available for the shopping?

Each of these factors needs to be considered individually and in combination with the others.

 

When a shopper has easy access to transportation, it is easy to choose the best place from which to purchase food and other items sold. Without easy access to transportation, choice of food purchase site is related to proximity to place of work and to one's home. For many workers, the closest place for shopping is often one of the smaller stores. These are usually located in the area and are easily accessible by workers and their family members. At these smaller stores, the choices are limited but the basic items tend to be available.

The place with the best prices often tends to be the open-air markets that can be found in many countries. Fresh fruits and vegetables, meats, household items, paper products and some clothing and footwear are usually sold at these markets. Shoppers can travel from table to table looking for the best products and the best prices. It is here that shoppers find the best value for their money.

Bulk pricing when items are on sale is generally not an option for workers for the following reasons:

- Extra money to "buy ahead" is generally not available.

- Storage space is extremely limited.

- Items needing refrigeration cannot be stored since most homes lack refrigerators.

Transportation is another factor that must be taken into consideration when examining choices for shopping. Most workers do not own cars. Therefore to shop at a supermarket that may be at a distance requires one of the following:

1. Knowing someone with a car. Workers will usually share the cost of the gasoline for the shopping.

2. Taking a bus to the supermarket and a bus or taxi home after the shopping is completed. The cost of each of these needs to be included in the shopping cost.

3. Walking home from the supermarket with the bags filled with groceries.

No matter which of these a worker has available, each transportation choice will be limited by the number of plastic shopping bags (or other carrying container) that can be carried at one time.

In an ideal world, the place with the best prices would be the site for shopping. However, the ability to do comparison shopping is beyond the daily reality of most workers. These factors all affect the ability of workers to provide adequate nutrition for themselves and their families. To determine the purchasing power needed to attain nutrition-oriented diets at the lowest prices, they must all be taken into consideration.

 

PURCHASING POWER INDEX STANDARDS FOR WATER AND SANITATION

Text Box: The Global Burden of Disease from Insufficient Water for Drinking, Sanitation and Hygiene:

•	3.4 million people, mostly children, die annually from                  water-related diseases. 
•	2.4 billion people lack access 
      to basic sanitation.  
•	1.1 billion people lack access to even improved water sources. 
•	Access to safe water supply and sanitation is fundamental for better health, poverty alleviation and development.

Water Supply and Diarrhea
•	2.1 million people die every year from diarrheal diseases (including cholera) associated with inadequate water supply, sanitation and hygiene. The majority are children in developing countries.
•	Water, hygiene and sanitation interventions reduce diarrhea incidence by 26% and mortality by 65%.

Source: World Health Organization http://www.who.int/water_sanitation_ health/policy/en/

 

Developing a standard for water requires an integrated understanding of the reality in which water can be accessible, acceptable and affordable anywhere in the world. A water standard requires attention to the needs and requirements associated with adequate and clean drinking water as well as sufficient water to meet the hygiene and sanitation needs of a person and a family.

In the 1990's, during the International Decade for Water and Sanitation for Health, the WHO determined that sufficient water for sanitation and hygiene was more important than the overall purity of the water in preventing disease.

In addition to the amount of water that needs to be available, the water has to be accessible within a reasonable amount of time. It has to be relatively close to where workers and their families live, for the time used to bring water is time that cannot be used for work, study or other activities. This factor must also be considered when examining the PPI standards for water written below.

Realistically, in any countries, simply assuring adequate potable water is an enormous task. Water may have to be carried in containers from far distances. Or water may have to be purchased from trucks that deliver the jugs of water…with the buyers at the mercy of the water sellers. Having continuous access to water via pipe and tap when one needs the water is almost unheard of in many parts of the world. The question is how to address a water standard realistically. Added to the issue of physical access is the growing move to privatize water as well as its delivery, often putting it out of the financial as well as physical reach of many who need it.

The components of a water standard are simple: potable water, that is, water that is healthy for drinking and non-potable water that is used for hygiene. Hygiene activities include bathing, washing of clothes, eating and cooking utensils, sanitation and other similar activities.

In 2002, the United Nations adopted water as a human right. This adoption committed the 145 countries that have ratified the International Covenant on Economic, Social and Cultural Rights to work to ensure fair and non-discriminatory access to safe drinking water. The UN Committee on Economic, Social and Cultural Rights declared: "The right to water clearly falls within the category of guarantees essential for securing an adequate standard of living, particularly since it is one of the most fundamental conditions for survival."

 

According to the World Health Organization (WHO), 45 liters per capita per day is the break point where insufficient water will result in a significant and noticeable decrease in infectious disease. Of that amount, approximately 2-4.5 liters per day needs to be potable or drinkable water, with the amount varying according to the person's activities.

Therefore, CREA has divided the water standard into two sections.

Section 1: Standard for the Sustainable Living Wage or the Sustainable Living Income

Section 2: Standard for the Sustainable Community Wage or Sustainable Living Community Income

 
 

SUSTAINABLE LIVING WAGE and SUSTAINABLE LIVING INCOME STANDARD FOR WATER:

Non-Potable - 30 liters per person

Potable - 2.0 liters per day per person in temperate climates

4.5 liters per day per person in hot climates

SUSTAINABLE COMMUNITY LEVEL WAGE and SUSTAINABLE COMMUNITY INCOME STANDARD FOR WATER:

Non-Potable - 50 liters per day per person

Potable - 2.0 liters per day per person in temperate climates

4.5 liters per day per person in hot climates

 

STANDARDS FOR EDUCATION NEEDS

Education is a basic need within any community. Formal schooling provides the students with the skills they need to communicate, to calculate and to create. Access to education has several components. First, a school must be physically accessible. Second, the family needs to be able to pay any required school fees. Even when school is free, there are often school fees that are required. Third, the money to pay for uniforms and school supplies has to be available when these also are required. Fourth, the children, especially the older children, need to be free to attend school. That is, their labor should not be required to meet the struggle for a decent standard of living for the family.

SUSTAINABLE LIVING WAGE and/or SUSTAINABLE LIVING INCOME STANDARDS FOR EDUCATION

For each of the years of compulsory schooling for each school age child, money needs to be available for school fees, school uniforms, school supplies, and transportation to/from school if necessary.

STANDARDS FOR HEALTH and HEALTHCARE

Defining healthcare standard is a complicated task. In any country, it must start with the most basic requirements of water and food. In previous sections, the standard for food provides for the nutrition that is the foundation for health.

In the water standard, the twin components of potable and non-potable water provide the basic standard for health. The health effects related to sufficient water are numerous. Sufficient water is necessary to prevent dehydration and death. Potable water is necessary to avoid the numerous diseases associated with water contamination. Having sufficient water to wash one's hands is critical whether after defecating or before preparing food or eating. Accessibility of water supply and the effective use of water for cleanliness are essential for hygiene. Each leads to significant improvements in health even when water is limited.

PURCHASING POWER INDEX STANDARDS FOR HEALTHCARE

Coupled with effects of nutrition and the availability of sufficient and appropriate water, there are a group of everyday items which need to be available. These include common medicines such as aspirin, acetaminophen, ibuprophen and other similar products. These should be available along with common antiseptic and bandages for cuts and other wounds to protect against infection.

Costs associated with vaccinations that provide immunity to common diseases must be possible. These include whatever fees are necessary at the doctor or clinic as well as transportation costs. Additionally, members of the family need to be able to go to the doctor and dentist when necessary. This requires some savings that make these visits possible. Again, transportation must be included. Since it is impossible to know when someone will need to go to the doctor, savings for these times must be possible.

There are traditional treatments for illness in many countries. Markets often include stands or stalls where traditional medicines and pills of many types are available for purchase. Traditional medicine is to be honored for the healing and health purpose it serves. Costs of these treatments must be included.