Here is an article that I read yesterday: “Why Do The Middle Classes In South Africa Pay Their Domestic Workers Such Low Wages?

It’s written by a Human Rights graduate student at Columbia University in New York, with interests in women’s rights, youth and gender in Southern Africa.

I don’t really want to turn this into a public naming-and-shaming – but I get seriously annoyed by this kind of article.

Here is an approximate summary of the key points:

  1. We recently watched the Hewitt family give up their middle class Pretorian lifestyle for a month to live in Mamelodi and blog about it, and nothing changed.
  2. #GeneralDisgust
  3. Shame on the middle class that can afford to pay their domestic workers more but don’t.
  4. An introduction to basic math: R150 per day – R20 per day transport = R130 per day ≠ a living wage.
  5. Even if the Department of Labour says it is, it obviously isn’t.
  6. True, the unemployment rate is 25.5% – but actually, forget that. Those kids that can pay more refuse to pay more, which is totes shocking!
  7. #GeneralDisgust

It actually makes me angry. Mainly because the main outcome of moralistic argument is passionate opposition from the people that you’re addressing.

And when the main conclusion to your own question is “because the middle class can”, then you’ve not done the basic economics.

So here are the basic economic questions:

  1. Who sets the wages of domestic workers?
  2. Do domestic workers earn a fair wage?
  3. What, if anything, could make the system fairer?

How Wages Are Set

Well. This:

Here are some market factors to bear in mind in relation to demand:

  1. Domestic workers are a luxury good for the middle class.
  2. When the price goes up, that does not necessarily mean that there are fewer “jobs” available – it just means that the average household may reduce the number of times that the domestic worker comes in every week.
  3. When it comes to price negotiations, the middle class housewives probably do discuss it with each other. Likely in much the same way as the domestic workers discuss their daily rates amongst themselves.
  4. But “price” is more than just the daily wage. I mean, this is somewhat anecdotal (my sample size is the middle-class homes that I’ve spent time in), but the ladies that come in to clean usually get food provided for them on the days that they work, as well as first pick of all secondhand clothes, shoes, linen, appliances and furniture.
  5. The middle class also take on the risk of having someone in their homes. It may sound counter-intuitive, but I’d be willing to bet that this acts as a deterrent to hiring a domestic worker – unless it seems like a really good deal.
  6. Finally, labour laws make it very difficult to fire a live-in domestic worker. When it comes to having an unwanted worker around – being forced to keep them in your home feels like a violation of privacy. I think it explains why South African practice is to ask a char lady to come in once or twice a week, rather than hiring a permanent maid.

Some market factors to bear in mind in relation to supply:

  1. The unemployment rate is 25.5%.
  2. As recent outbreaks of xenophobic violence have demonstrated, there is also large competition from foreign immigrants into South Africa.
  3. If the market practice is to hire char ladies on a day-by-day basis, then that doesn’t really allow for wage negotiation from a position of strength*.
    *Yes, I realise that’s probably why the practice is to hire on a day-by-day basis. 

Agreed: the situation seems “biased” against the domestic worker. But that’s like saying that the dating process is biased in favour of the beautiful. It’s not so much a societal injustice as an environmental one.

The real risk is that this bias gets abused. I realise that the Human Rights graduate and I may differ on the term “abuse” here. For me, “abuse” implies the type of practice that is generally found in the Middle East; where domestic servants have their passports confiscated, and are generally enslaved in all but name. For the Human Rights graduate, perhaps the term “abuse” would also include wages of $15 per day.

Is a wage of $15 per day a fair one?

Assuming that a char lady elects to work 6 days a week, at $15 per day, she’ll earn around $360 (or R3,600) per month in direct cash salary.

If we’re going to be fair about this, we should probably include the value of the meal that she gets each day that she works. Even if it’s nothing more than a loaf of bread, some jam, and a cup of tea (it’s rarely more than that), then we’re still talking in the region of around $1.50 (or R15) per day. Which works out to an extra $36 (or R360) every month.

But putting that to the side for the moment, earning $15 per day is meaningless unless we know something about her expenses. I mean, we know that absolute poverty is generally measured by living on less than $1 per day, so she’s clearly living above that. But absolute poverty measures are a bit ridiculous: everything is relative after all.

Fortunately, we have the experience of the Hewitts to draw on (the family mentioned above that moved to the Mamelodi township for a month). Here’s a link to their blog post on expenses.

And here are the two graphical summaries of their spending (for a family of four):

As Ena Hewitt points out, the above budget does not include the costs of:

  1. school fees
  2. school uniforms
  3. furniture and fittings
  4. cellphone airtime
  5. travel to and from funerals
  6. sending money home to families

However, that budget did come in at less than what our char lady would spend. And as I’ve pointed out in two previous posts (Poor People Think Differently and Susus and Stokvels), and as demonstrated by the research in that awesome book “Poor Economics“, the poor have their own financial savings mechanisms for coping with the bigger expenses.

The point is: $15 per day is not an “immoral” wage. People can and do live on it. And here is why that makes sense:

  1. The demand for basic items is going to be driven by the budget lines of the people that demand them.
  2. $15 per day is in line with what non-domestic workers are earning. Like taxi drivers (minimum wage of between R1,700 and R2,500 per month). And waiters (minimum wage of between R2,200 and R2,500 per month).
  3. So domestic workers are not necessarily disadvantaged in their home markets where they are part of the demand curve.
  4. And sure – taxi drivers also earn commissions, and waiters earn tips.
  5. But domestic workers usually have access to the secondhand clothing and furniture. And given that charladies usually work in two to three homes at a time, their chances of monthly income-supplements-in-kind are high.

The Glaring Problem

47% of the Hewitts’ budget was spent on transport.

That is the part that should demand our attention.

Because the South African middle class will spend a lot of time bemoaning the increase in fuel prices, and the imposition of eTolls on the highways – but they will never feel the impact like the charlady that needs to pay for a taxi ride to her place of work.

Can I make a suggestion (this is the point where it can get ethical)? Perhaps the middle class should strip out the transport from the daily wages that they pay their domestic workers.

This is a cost that is not related to the service that they receive. That is a cost worth covering.

Even if all that one does is say “Let’s take out the $2 per day that you currently spend on transport, we’ll cover that, and we’ll guarantee you $13 per day.” Because that way, when transport costs increase, they don’t impact her actual take-home.