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Minimum Wage Still Can’t Pay For A Two-Bedroom Apartment Anywhere
- OceanKing 7y agoIt seems that minimum wage is not, in fact, supposed to support a person 100%, not especially a family.
- ocdtrekkie 7y agoI am not sure why people think minimum wage must be enough to afford a two-bedroom home. Ideally minimum wage should comfortably allow one person to support... Themselves, minimally. Which means a studio or one bedroom. People should not aim to remain at minimum wage long, but use it as an entry point for somewhere better.
- overthemoon 7y agoWhy not? Why shouldn't it? Why is this the proper state of things?
- ocdtrekkie 7y agoBecause it in no way makes sense for someone to hire a first time employee who still lives with their parents for a zero skill job at the rate of "enough to afford a two-bedroom house".
- SketchySeaBeast 7y agoIsn't there a huge conceit that that's who earns minimum wage? Looking around my local wal-mart, it would appear many people first entered the job market at weird times in their lives.
- sct202 7y agoWalmart's starting pay is $11 now, so they aren't even at minimum wage anymore.
- leetcrew 7y agoWalmart actually pays considerably more than minimum wage, so I'm not sure what point you are making here.
- SketchySeaBeast 7y agoI see now that changed recently, though I didn't see any demographics shifts in who are being employed. And you know exactly the point I was trying to make.
- mlevental 7y ago> a first time employee who still lives with their parents what makes you think this is the typical minimum wage earner?
- maxlybbert 7y agoThe minimum wage is “the least you can pay anyone for any reason.” If you set it too high, then first time workers who still live with their parents won’t be able to get jobs. At all.
- mlevental 7y agothat has almost nothing to do with what i asked
- maxlybbert 7y agoYou asked “what makes you think this is the typical minimum wage earner?” I answered “if you don’t take that case into account when setting minimum wage, then that worker won’t be able to get a job.” Minimum wage is the least you can pay anyone for any reason. It is, by definition, an edge case.
- mlevental 7y agoagain - that has almost nothing to do with what i asked. bls: https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home.pdf https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home.... > Although workers under age 25 represented only about one-fifth of hourly paid workers, they made up just under half of those paid the federal minimum wage or less. that means just over 50% of minimum wage earners are older than 25 (well outside the typical age where you're still living with your parents or just entering the workforce) >It is, by definition, an edge case. it is de-facto not an edge case.
- maxlybbert 7y agoWhile I’m sure most people over 25 still making minimum wage would prefer a pay raise, and for the sake of argument, I’ll even accept that the world would be a better place if they got that pay raise, if you raise the minimum wage enough that it’s no longer profitable to hire inexperienced workers, then those potential workers will be locked out of the market. I acknowledge that there’s a serious problem if millions of experienced workers are unable to get more than minimum wage, but I would prefer we fix that by helping those workers become more valuable, not by putting a “you must be this tall to ride” sign on entry level jobs.
- NotAnEconomist 7y agoBecause "minimum wage" is the floor of the economic spectrum -- and basic economics dictates that if some people have more money, they'll drive their desires purchases above the price someone with less can afford. However, you need to pay more for some jobs, because they're harder or require more skill. Further, empirically, stratified-by-economics societies are more stable than forced-equal-by-government societies.
- pingpongchef 7y agoMinimum wage is an artificial value which is propped up by law, and can change without respect to an individual's situation. It would be better to aim for the highest wage an individual can get in exchange for labor.
- Johnny555 7y agoThat's fine in an area where these better paying jobs are available, but in many areas of the country, well paying jobs for unskilled workers are scarce, and support systems to help these unskilled workers improve their skills are nonexistent. It can be hard to a person to pull himself out of life-long poverty.
- Kalium 7y agoPeople are using a 1950s-era nuclear family model, with the idea that a minimum wage should support a family of at least two adults and one child. Preferably with a yard, lawn, dog, and white picket fence.
- true_religion 7y agoMinimum wage doesn’t track inflation. If it did, I would have no complaints. But it’s hard for me to understand people saying minimum wage should only be for one person eking out a bare existence, when it’s value in real money has fallen over the past 70 years.
- Kalium 7y agoWould you be happy if minimum wage was CPI-indexed to track the cost for one adult's bare-bones existence? Obviously this also requires defining what that minimum is, as social norms are also subject to inflation - when a US minimum wage was introduced boarding houses were common. Now they're unheard of.
- true_religion 7y agoThat would be fine, as it would mean that we as a society explicitly agree what minimum wage should be about. And we would probably have massive campaigns to get adults with families off the minimum wage, as well as ensure that adults never have to take a minimum wage job in the future. We could leave minimum wage to children, and charity workers. As it stands, it used to pay better but has slowly slid to being subsistence living.
- xienze 7y agoWhat everyone fails to realize is that every job has a maximum value associated with it, and therefore a maximum wage, assuming your employer isn’t in the business of losing money. When you raise the minimum wage to $X/hr, by necessity employers (again, in the interests of not losing money) will no longer be able to offer jobs that generate less than $X/hr in revenue. This becomes a problem for people who lack the skill to perform a job that generates at least $X/hr — they become unemployable, either through job elimination or automation.
- fuzz4lyfe 7y agoAt this point the federal minimum wage is a anachronism. Market forces have risen wages well past it. It doesn't really serve much of a purpose anymore. For example the average Walmart employee makes twice the federal minimum wage.
- djschnei 7y agoEh I'm not positive it should even be able to support a single person... Why do we insist on raising the bar for employment so high? If a 16 year old wants to get their first job, they shouldn't be required right of the bat have a productive output sufficient to support themselves. That's not the point of minimum wage jobs - or at least it never was until we started arbitrarily setting a minimum value.
- tcfunk 7y agoThat's all well and good if 16 year olds are the only ones making minimum wage. And if their parents haven't kicked them out of the house already because they got pregnant too early. Or have a sexual orientation that their parents don't agree with. Or..
- true_religion 7y agoIt would be easier and better to just help out edge cases directly. A 16 year old kicked out of their house for a pregnancy shouldn’t be forced to work minimum wage, but rather receive community support so they can finish schooling and rise to the point where they can prosper.
- imgabe 7y agoDo we need to handle those edge cases by mandating what employers have to pay ALL employees? Maybe there is a better way to help people in needy situations without distorting the labor market for everyone.
- suby 7y ago16 year olds working min wage is the edge case. The average retail worker for instance is 37. https://www.google.com/url?sa=t&source=web&rct=j&url=https://familiesandwork.org/downloads/TurnoverAndRetail.pdf&ved=2ahUKEwidpaCDl_biAhXGqlkKHUFuBjQQFjABegQIDxAG&usg=AOvVaw2QfCizk_emgU0YIDzaDwgO https://www.google.com/url?sa=t&source=web&rct=j&url=https:/...
- 7y ago
- ufo 7y agoSupporting only one person means that there is not enough left to support any children. Or a sick relative. Or to otherwise live a fulfilling life. Not everyone has the opportunity to move on to a better paying job.
- SomeOldThrow 7y ago> I am not sure why people think minimum wage must be enough to afford a two-bedroom home Disregarding the home part (cities are being ruined by single family deatched homes)--because if that's not true, then America has failed its citizens. Also, I hate to be the person to bring this up against my own post, but downvoting because you disagree with me is not good for productive conversation. Dogmatic belief in real-estate-as-investments is not going to solve anything—having this conversation isn’t going to destroy your investment as a homeowner or even landlord.
- shados 7y agoYeah this is a bit confusing. If minimum wage was enough to afford a 2 bedroom, why would we even bother building 1 bedroom and studios? So people who could otherwise afford 2 BR downgrade?
- willhk 7y agoNobody aims to remain at minimum wage... The problem is we've been doing a great job of hollowing out the middle of our economy and replacing it with a relatively small amount of upper middle-class tech jobs and massive VC backed profits. This often leaves minimum wage jobs the only option for people who used to make more but their career tanked for reasons outside their control
- zeendo 7y agoPeople probably think this because they've given it more than the 30 seconds of thought that you have.
- ustolemyname 7y agoDoes not. What it should and should not do is a subjective matter.
- titusjohnson 7y agoI can agree that the minimum wage was never intended to support a family 100%. However, stating that it was never intended to support a person 100% is just flat out ignorant. The history of minimum wage is easily read up on.
- anarchodev 7y agoExactly, it's meant for high school kids looking for pocket money! That's why McDonald's is always closed during school hours.
- zxcvvcxz 7y agoIf you want the better things in life, you should be able to do better than minimum wage. Life is a competition, you don't get to be here for free.
- chrisseaton 7y ago> And only in 28 of the country’s counties can a 40-hour-a-week minimum wage worker afford a one-bedroom [home] So where do they live?
- the_jeremy 7y agoWith roommates, mostly.
- opencl 7y agoApartments, with roommates, their parents' house, tents, etc.
- sdinsn 7y agoNot in a house. Apartments, either a studio or splitting a 2/3 BR with roommates.
- shados 7y agoStudios, or with multiple minimum wage salaries? Or a lower end one bedroom home (turns out there's a range). Other options include overtime or getting multiple jobs. And while it shouldn't be an option, unreported tips and under the table pay is also a thing and its likely impacting purchasing power of some of the people in the statistics. My parents were "minimum wage workers" for a really long time and made more than I made as a software engineer for the first half of my career in practice.
- temp-dude-87844 7y agoOne or more of the following: - Living in units where the rent is far below the median rent. - Working multiple jobs. - Living in a multiple-income family. - Living with roommates and pooling rent money. - Payday loans. - Behind on rent. - Living in a house and not directly responsible for mortgage payments. - Living with others in an informal arrangement and not legally responsible for payments. - Homeless
- hello_tyler 7y agoMinimum wage workers can't afford a 1 bedroom apartment or studio where I live.
- sdinsn 7y agoSo perhaps they should split a 2/3 bedroom with roommates? If someone makes the absolute legal minimum, why does every expect them to live alone?
- antidaily 7y agoWith kids, though?
- viklove 7y agoIf you're working a minimum wage job, maybe don't have kids?
- Broken_Hippo 7y agoSo, if you had kids while you had a decent job and the place closes, you should give away the kids because your replacement job is minimum wage? Is it the same if you wind up disabled and suddenly become a low earner? Or, I know, celibacy for everyone and hope you don't get raped? Free abortions when birth control fails, if you can afford birth control and aren't unlucky enough to have issues with it? Do you happen to know the income level when kids are affordable? Is this well above the average wage in the area (or in general)? Is this higher or lower than low-level military salary? Knowing this sort of number would really help folks out.
- leetcrew 7y ago> So, if you had kids while you had a decent job and the place closes, you should give away the kids because your replacement job is minimum wage? suddenly becoming unable to provide for your kids through no fault of your own is quite different from deciding to have children when you know (or should know) you already have no ability to support them. in both cases, we need to at least do something to help the children, but we have to structure it carefully to avoid encouraging the latter. > Do you happen to know the income level when kids are affordable? no, but I can look at what I spend to sustain myself every month. if I can't comfortably double that, I'm probably not ready to have my first child.
- throwaway98434 7y agoThis article like so many others makes a critical mistake in using a median price for minimum earners. A minimum wage earner is not and should not be in the market for a median priced home. A median wage earner would pursue a median priced home. A bottom quartile earner would pursue homes priced in the bottom quartile. Not the median. The title of this article is false. Minimum wage earners can often afford two bedroom homes priced at the lower end.
- SomeOldThrow 7y ago> Minimum wage earners can often afford two bedroom homes priced at the lower end. [citation needed] Looking around the bay they appear to simply become homeless, especially if there's any interruption in work, and if they're lucky they're able to move away before this happens.
- leereeves 7y agoObviously not in the Bay Area. People making six figures can't afford homes in the Bay Area. But homes are cheaper almost everywhere else in the US.
- SomeOldThrow 7y ago...and that's the economy working, where you can be run out of the city because a rich person wants your house?
- TylerE 7y agoYes? Supply and demand is basically the fundamental law of economics.
- SomeOldThrow 7y agoNo, it’s not. It’s the foundation of market economies, which are not the only way to distribute goods and services. There are many alternatives to this.
- mgraczyk 7y agoOn the other hand, if this weren't the case I think it would be even more strange. "Law requires companies to automate or illegally hire any job worth less than a 2-bedroom home"
- Damorian 7y agoIs there anything wrong with this? If a job can't provide for a person at some (philosophically debatable) level, it's not a job worth doing, free market be damned. We could take this to a logical extreme and think of all the jobs that could exist in the absence of a minimum wage and basic human necessity, but the reality is both of these exist. Either it's "worth" more for an employer to pay them more, or automating it becomes more competitive. Both of these drive innovation and advance society. This is why I've supported a higher minimum wage.
- mgraczyk 7y agoYes, there is plenty wrong with this. It is a strange economic intervention that distorts incentives and rarely helps low-wage populations or innovation. Unfortunately there are other options besides "automate" or "pay more". For example, you can pay people under the table, outsource, close down your business (as many restaurants do), change your business model to require less labor (many restaurants in the US are switching from full service to counter-serve). None of these are good for workers.
- dagw 7y agoNot everybody needs a two-bedroom apartment. I mean I was 30 and practically married before I ever had something that big. If you want to argue that every full time job should pay enough to afford a small 1 room apartment within a 30 minute commute, then perhaps I'd agree. But a two bedroom apartment is a straight up luxury in the grand scheme of things and a ridiculous minimum standard to set.
- kortilla 7y agoWhy should minimum wage be enough to support anything? It’s not like we have requirements that employers provide 40 hours of work.
- python_gt_r5 7y agoWell I am in the 98% percentile of income in London and I can't either.
- AdmiralAsshat 7y agoMm, yup. Solid navy within the DC Beltway area. That feels about right.
- dsfyu404ed 7y agoNew Hampshire is even worse since it doesn't even have many good paying jobs to drive that cost up. Any area that's within a reasonable one day drive with a family of the Boston area (i.e the max distance many people will consider for their "vacation cabin") is just solid navy. The people of NH and ME always complain about MA money driving up the cost of land. It looks like they're not wrong.
- sdinsn 7y agoWhy would a minimum wage worker be trying to buy a 2-bedroom home? Edit: Meant to say rent instead of buy
- alistairSH 7y agoThey aren't. The article is about renting a 2-bedroom home. And nowhere do they limit the definition of "home" to "free standing, detached dwelling" - I believe their figures include 2-bedroom apartments as well.
- deleted 7y ago[deleted]
- anbop 7y agoMinimum wage should provide a minimal lifestyle. Not penury, but perhaps a room in a shared accommodation. Why would the legally minimal wage support housing an entire family?
- lucaspm98 7y agoThe obvious response to this is that the minimum wage is simply not supposed to be a sole source of income for a person living on their own. The bigger problem with this particular article is qualifying affordable as less than 30 percent of income. That is a great rule in most situations. However, if you are on a limited income the percentage housing will be expected to be higher. It is one of the least elastic expenses, while things like a car or entertainment can be cut back or substituted for alternatives like public transportation. I don't know what the percentage should be, but 30% is unrealistic. If you think about it, the opposite will also be true in many situations. If my income doubled from 100k to 200k overnight, I would consider upgrading apartments but from 1k a month to 1.3k a month. My food and entertainment costs would scale much quicker as a percentage of income.
- merpnderp 7y agoI get roughly $1,500 for a couple per month, at 30 hours a week, post tax, but before government assistance programs. There's no place in Oklahoma where you can't find a 2 bedroom for $700/month. I'd bet that most of the surrounding states are similarly priced. In my city you can find single bedrooms, with all utilities plus washer and dryer included, for $350/month.
- DINKDINK 7y agoSeveral co-related factors affecting this: Worker productivity increases cannot be legislated. Such productivity increases can only come from workers improving their skills or technology that increases their productive output (as simple as an electric drill to as advanced as an exoskelleton with a HUD). Minimum wage laws are effectively bans on low-productivity workers. By making labor artificially expensive through legislation, demand for it drops, total economic output decreases, production costs increase. There's no reason to believe that the home-production industry would be able to reduce costs / increase output with minimum wage increases; in fact that opposite is the case. Legislation can only reduce the permitting costs of housing production IFF it becomes more permissive. In the regions of the US that I'm familiar with, all the areas that have high housing costs pass legislation that increases permitting costs or transactional costs to bring housing to market. This can only result in a price increase globally with some politically-connected group receiving a benefit. Legislation and corporate-bank policies artificially increase the money supply to the greatest degree with housing loans. Typically these workers are not minimum wage and in addition to the above effects, the Cantillon effect gives an undue subsidy to these higher wage workers https://www.aier.org/article/sound-money-project/cantillon-effects-and-money-neutrality https://www.aier.org/article/sound-money-project/cantillon-e...
- zuminator 7y agoI'm all for people earning a fair wage but I find reports like this a bit disingenuous. A minimum wage person can't afford a median apartment? Ok but you would expect that minimum wage workers would seek out bargain low-end units, and leave the median apartments to median income families. So while acknowledging that in many cities including my own there is an overall affordability issue, I have a problem with being presented with misleading statistics, even if for noble reasons. About 5 percent of workers make minimum wage or less. A straightforward and honest question would be to ask if they can they afford available apartments in the bottom 5-10% range of rents? Maybe they can't, and that would indeed be a problem. But in terms of this report, we have no way of knowing.
- gok 7y agoThe actual report: https://reports.nlihc.org/sites/default/files/oor/OOR_2019.pdf https://reports.nlihc.org/sites/default/files/oor/OOR_2019.p... Some notes: - Those earning minimum wage are unlikely to be in the median rental market - The report doesn't include the impact of any tax credits like child credits, EITC, LIHTC - They don't adjust minimum wage by local jurisdictions. For example, minimum wage in Chicago is $13/hour but they only list the Illinois minimum wage ($8.25/hour). This is particular distorting given that cities (with higher minimum wages) are home to most renters
- dragonwriter 7y ago> Minimum Wage Still Can’t Pay For A Two-Bedroom Apartment Anywhere Was it supposed to?
- segmondy 7y agoWhy should it pay for 2 bedroom? It should pay for the minimum shelter. Which I would say is a studio.