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The University of Michigan Exploits Graduate Workers, Refuses to Pay a Living Wage

Graduate student workers at the University of Michigan are fighting exploitation by university administrators, and trying to win a living wage.

Ryan McCarty

July 11, 2023
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Striking University of Michigan graduate employees rally on the Ann Arbor campus after walking off the job

Graduate student instructors at the University of Michigan — like so many other grad student workers across the country — have been on strike for a living wage and better workplace conditions. The grad student union, the Graduate Employee Organization (GEO), has been struggling against the university and its slate of million and billionaire administrators since last winter, arguing for a raise to meet the annual $38,000 basic cost of living in Ann Arbor, Michigan.

Graduate instructors currently earn about $25,000, and GEO reports that 80 percent of its members are rent burdened (meaning they pay more than a third of their wages in rent), and one in five has delayed medical treatment because of cost. Given today’s skyrocketing food and energy costs, these workers simply don’t make enough to live.

In response to these dire material conditions, graduate student workers, like many other groups of underpaid workers, have frequently drawn on the concept of a living wage when making demands for pay increases. This frames the GEO’s demands for higher wages as a reasonable request of the university administration and the publicly elected Board of Regents, with whom GEO is negotiating — a reasoned argument that couldn’t be dismissed. Still, these calls for a living wage have been grossly manipulated by university bosses, illustrating the need for working people to take more and different approaches to struggles for higher wages.

The phrase “living wage” has been thrown around with increasing frequency in cases like the national Fight for 15. The most common measure of a living wage is the MIT Living Wage Calculator, which averages costs of basic necessities in a given area and tallies up what a worker would have to make to pay for such costs of living. These calculations offer important reality checks when considering if workers are actually paid enough to cover housing, food, medicine, child care, and all the other daily costs that individuals and families accrue, or if low wages are subsidized by social safety net programs, as Government Accountability Office reports have found.

But just focusing on an hourly living wage can be limiting if we ignore the fact that a living wage is calculated for full-time employment only. If an employer pays $15 an hour, but offers workers only 20 hours of work per week, then those workers still aren’t earning enough to live on. Since lower-wage workers are much more likely to be denied full-time employment by bosses, simply fighting for a higher hourly wage is insufficient.

This is the case for University of Michigan students, who are paid about $18 an hour but for only 20 hours a week (they are not paid for their second job as researchers and are generally forbidden from taking on outside work). They often go without pay over the summer as well, leaving them far below the yearly $38,000 minimum that it costs for a single person without children to live in Ann Arbor ($88,000 for a single person with one child). So, essentially, graduate student instructors do make a living wage in hourly terms, but with too-few paid hours, which doesn’t provide them enough to cover the bills.

These contradictions have been cynically manipulated by the University of Michigan administration and the Board of Regents, all of whom have spent most of the last 10 months presenting numbers to show that grad students make a high hourly wage, ignoring that they aren’t paid for enough hours to make up for the rising cost of living.

The contempt for graduate workers’ experiences has been clear in these exchanges. In a May meeting of the University Regents (beginning at about 1:15:00), Amir Fleishmann, GEO’s contract committee chair, was mocked by Regents chair Paul Brown (Democrat), who suggested that graduate student instructors are only part-time workers, so they do not deserve a living wage of $38,000 a year, going on to ask if Fleishmann and the union thought that someone working only one hour a semester should still receive a living wage. In the July Regents meeting, Regent Michael Behm (Democrat) fell into an absurd kind of solipsistic idealism, explaining to GEO president Jared Eno that “it’s what you believe in your mind that causes the reality you have in front of you,” suggesting that graduate students just need to look at the university’s offers in a different way, regardless of the material facts that a raise of $100 a month does not cover rent increases of up to $300 a month, which are common. 

The regents were largely silent on questions of rent increases, perhaps at least partially because a large percentage of Ann Arbor rental units are owned by Regent Ron Weisser (Republican), a billionaire Trump donor and former Michigan GOP party chair. In response to an email, Regent Jordan Acker (Democrat) described himself as “a lifetime supporter of organized labor,” even as he denied workers substantial wage increases. He said he was mainly interested in balancing “our values as an institution and my fiduciary duties as a trustee,” referencing the regents’ role in overseeing the university’s more than $17 billion endowment.

In sum, the university and its administration claim to pay a living wage while workers do not, in fact, receive a living wage. On one hand, this is just capitalist exploitation at work. It’s never a surprise when bosses — including self-styled labor-ally Democrats on the Board of Regents — are willing to throw workers under the bus in a mad rush to talk about great progressive institutions. Reasoned arguments about living wages weren’t enough to change their minds, because these regents are acting in their position as bosses, whose interests directly oppose those of the workers who cannot pay their bills. Even worse, perhaps, is the way these bosses have portrayed GEO’s demands to other working people. Because of discrepancies between an hourly living wage and a wage that actually allows workers to cover all their living expenses, the university has publicly claimed to be paying higher-than-average wages, even as workers struggle to make ends meet.

These cynical games about what “living wage” actually means are emblematic of the callous disregard capitalists have for workers’ living conditions. And we should point out this disregard whenever possible. Like many living-wage advocates, we can call out the sheer inhumanity of denying working people their everyday means to exist.

But, on the other hand, the responses to calls for living wages that we see from the University of Michigan suggest that additional tactics might be necessary. At its heart, the living-wage argument is based on an ethics that capitalists simply do not live up to. So it will also be important for workers and their allies to loudly point out who is creating the value in the workplace, then demand that they are paid for that value. Graduate instructors don’t deserve more money because it’s the right thing for benevolent bosses to do. They deserve more money because undergraduates are paying a lot to take classes taught by those graduate instructors.

So, if we wanted to figure out how much the university is exploiting the labor of its graduate workers, we would start by figuring out how much value graduate workers are creating and how much surplus value the university is taking instead of paying the producers of that value.

It’s a pretty simple bit of math, really. The university charges $16,736 for up to 18 credits a semester over two semesters for in-state students. That’s $464.89 per credit hour if the student takes all the credits they can in a semester, and a four-credit class costs the student $1,859.50. For out-of-state and international students, the yearly $55,334 tuition means they pay $6,148.22 per class. So, for an 18-student class, the university gets between $33,471 and $110,667.96, depending on the ratio of in- and out-of-state students.

Taking that a step further, we can see that a graduate worker who teaches in the fall and winter semesters brings in between $66,942 and $221,335.92 per academic year. In 2022, the university reported that 52 percent of students were in-state. So, we can say that, if a graduate worker teaches roughly half in-state ($16,735.50) and half out-of-state students ($55,334), then one course earns the university $72,069.48. An instructor teaching fall and winter, earns the university $144,138.96

That means, even if the university paid a grad instructor the $38,000 a year, which is what the union is asking for, it would still bring in about $106,138.96 in extra cash per graduate student worker over the course of the academic year. In the English Department Writing Program alone, the 55 graduate student workers who teach first-year writing in the fall and winter would collectively bring in $5,837,642.80 after the increases GEO is demanding. Without the increases, though, the university keeps $6,552,642.80. Clearly, underpaying the workers who are creating the value in the first place is a profitable endeavor.

When faced with such hard facts, the university administrators and their apologists would certainly argue that there are a lot of other costs that go into running a school: libraries, maintenance, utilities, administrative staff, additional programs, etc. And it is true that a detailed accounting would be necessary to further develop arguments about the rate of exploitation of graduate workers. But if graduate student instructors are providing this much surplus value, it seems likely that those costs might be covered fairly quickly. And, of course, a large part of the money for running the publicly funded university comes from governmental sources, as the 2022–23 budget reports, including $386,019,800 from the state of Michigan and $1,180,000,000 from federal government programs. With these facts in mind, it rings rather hollow when bosses claim that the university needs to underpay its employees so it can make up for other expenses.

Because the scale of the difference between tuition dollars and teacher pay is so striking, putting that wide divide right in the public eye might create greater support for GEO and undermine the disingenuous responses the university has made to calls for a living wage. And, more broadly, modeling this kind of value analysis might be useful for connecting GEO’s struggles for a living wage with similar struggles across the working class. All workers deserve a living wage, but when making that argument, it is important to emphasize our human needs as working people and the ethics of providing us with the resources to maintain a decent standard of life. But we can also look to concrete ways to point out that we are the ones producing the wealth of society, and it’s high time that we are paid accordingly.

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