10 ms·

Minimum wage workers cannot afford rent in any U.S. state

82 points by MindGods 6y ago

apsec112 6y ago
SlateStarCodex on why this is deceptive: https://web.archive.org/web/20200303232829/https://slatestarcodex.com/2013/04/04/lies-damned-lies-and-facebook-part-1-of-%E2%88%9E/ https://web.archive.org/web/20200303232829/https://slatestar...
- Havoc 6y ago
  That appears to be debunking an entirely separate graph with different numbers and likely different flaws.
  - ikeboy 6y ago
    The source of the data is ultimately calculated using similar methodology. The flaws described generally apply here as well.
- vangelis 6y ago
  You get better results if you redefine "unaffordable". Also, the report did specify that 1BRs were also not affordable in 95% of counties going this metric. That's not to say some metrics aren't representative, rent in rural areas and cities in the same states may vary widely. They have it down by county in this report. "Out of Reach is consistent with federal housing policy in the assumption that no more than 30% of a household’s gross income should be consumed by gross housing costs. Spending more than 30% of income on housing is considered “unaffordable."[1] [1] https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2020.pdf https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2...
NovemberWhiskey 6y ago
Am I misreading this: the conclusion is that the lowest earners cannot afford 40th percentile rents?
- deathanatos 6y ago
  Yes, and no. Directly yes. But no, because the numbers are so insanely over I question whether they can afford 30th or 20th percentile too. It smells like the 40th-%tile is the number that the data exists for. I would welcome graphs showing this data at other %-tiles, and whether that changes the outlook significantly. But the report puts ~50% of the workforce below the national housing wage for a 1-bed. 50% of the workforce cannot all obtain better than 40th %-tile rents.
  - NovemberWhiskey 6y ago
    N.B. that the "fair market rent" also excludes public housing rents. Would it be reasonable to suggest that we could expect people earning only minimum wage to be consumers of public housing?
falcolas 6y ago
There's an important caveat, before everyone jumps on the title by itself: > The report, released Tuesday, defines “affordable” as spending no more than 30% of monthly income on rent, in line with what most budgeting experts recommend. The second caveat is this is rent for a 2 bedroom apartment; though they do say that it's also ~95% of 1 bedroom apartments. No comment is made on studio apartments or having roommates. EDIT: The full report this article is based upon: https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2020.pdf https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2...
- eikenberry 6y ago
  > No comment is made on studio apartments or having roommates. To me this is the most telling part. When you are poor you need to have one or more roommates to afford housing and this is not new. What is wrong with roommates? I do think the US could use more small/studio apartment options for those who have a bit more money and prefer to live alone. I lived in a small studio once and enjoyed it, though I usually had roommates.
  - dumbfoundded 6y ago
    It depends on what the goal should be. Having roommates is fun when you're 20 something. Not when you're trying to support a family.
    - eikenberry 6y ago
      Minimum wage is not designed to provide enough income to support a family. It it intended to prevent labor abuse.
      - worik 6y ago
        It really should be. Single people on the minimum wage would do very well. Maybe save? What is wrong with that?
        6y ago
tathougies 6y ago
Minimum wage workers should mainly be teenagers, young single people, and other dependents who don't need to live alone or for a family, and for whom minimum wage makes sense while they advance in careers. I honestly don't care if minimum wage means you can afford rent. I'm most interested in what percentage of those with dependents are working minimum wage jobs and what percentage of those that started out with minimum wage jobs have been unable to increase their earnings. MY guess is that these numbers are also terrible, but this is the thing to get down. We need to remove minimum wage laws and instead focus on making sure those with dependents and a need to live by themselves have wage growth through their lifetimes. It is no scandal if a young person makes little money at a time in their life when it is okay to live with family or with roommates.
- standardUser 6y ago
  "Minimum wage workers should mainly be..." Because you say so? Or do you have thoughts on specific policies that will make this true? Because currently, many people who need to support a household rely on minimum wage jobs (or close to it), and often without guaranteed full time hours and no health insurance.
  - apsec112 6y ago
    Minimum wage workers are only a few percent of the American labor force, and about half of them are under 25. Only about 20% were between 35 and 55. https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home.pdf https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home....
    - vangelis 6y ago
      The more interesting data is low-wage workers. Making 10c over the minimum wage would pull you out of that report.
    - standardUser 6y ago
      I'd say 20% is not a small number! I'd also point out that "just above minimum wage" isn't much better than minimum wage. For example, if you work for many large chains that pay minimum wage you're likely to get a raise at some point. That raise may take you from, say, $10.00/hr to $10.50/hr. Hurrah! I think a better metric might be (minimum wage + (20% * minimum wage)). That snags all those people who work at "minimum wage jobs" but have stuck around for a few years and gotten a few small pay increases, but are still being paid a wage that is a function of minimum wage. Just riffing here to be honest, but I do get a little uppity when people claim minimum wage jobs are just for teenagers or other "less important" wage earners. Part of this was from working in retail and food service when I was much younger and knowing a lot of adults, many single parents, working for close to minimum wage. Anecdotal, I know.
rayiner 6y ago
Is minimum wage workers affording an average 1-2 bedroom apartment with no other householders a goal we have set? The French minimum wage is 1,521 euro per month. 30% of that is 456 euros, or about $513. According to the underlying study, the average 1BR in Alabama is $665. Is housing in France, on average, really that much cheaper than Alabama? I don’t think these abstract targets are very helpful. According to the OECD, the US has some of the most affordable housing in the world: https://read.oecd-ilibrary.org/economics/the-average-oecd-household-has-79-of-disposable-income-left-after-housing-costs_21f178bd-en https://read.oecd-ilibrary.org/economics/the-average-oecd-ho... (showing percentage of disposable income left after housing costs). Also, the demand for a “federal affordable housing policy” is pretty breathtaking. Look at the list of states that have the least affordable housing: New York, Massachusetts, etc. A federal program would basically mean bureaucrats from these states would be imposing housing policy on the whole country. That sounds like a great idea!
- standardUser 6y ago
  Look at it from the other direction. Is working 40 hours per week but not being able to afford a 1 or 2 bedroom apartment a goal we want to set? If so, we have achieved it! I think most of us like the idea that if you put in 40 hours of work every week, regardless of the specific job, you are able to afford a basic standard of living.
  - rayiner 6y ago
    You’re begging the question. Is having your own 1BR apartment a “basic standard of living”? When did we decide that? Is that a goal other developed countries have set and achieved? Those are the pertinent questions, not what ideas “we like.” According to the study, that standard would require a $30-40 minimum wage in places like New York. Is that something any country has done?
    - brewdad 6y ago
      Ah yes, the attitude that put a man on the moon. "Nobody else in the world has accomplished this, so why should we even bother trying?"
js2 6y ago
A backgrounder on minimum wage, citing several studies, giving pros and cons, along with a mention of the EITC: https://old.reddit.com/r/Economics/wiki/faq_minwage https://old.reddit.com/r/Economics/wiki/faq_minwage
mjevans 6y ago
Due to how much it cost and also a glut of Federally insured mortgages, housing became a defacto investment for baby boomers. Housing should be a liability, owning land should be a liability. Neither of these should be investments. That's the true solution to spiraling prices.
- autokad 6y ago
  No. Housing should be an asset. If all housing and land were liabilities, then they would all be owned by the government (we tried that, most people didn't like it). The fact that homes are assets are not stopping people from owning homes (and why the f would someone want to own one if they were a liability in the first place?!?!). the median income in the US is about 60k and median home price is about 200k. you only need 3.5% to qualify for a FHA loan. I managed to save that when I was making less than half of the median income. We dont have a problem of people investing in homes, we have a problem of people not having good financial health (do to their own bad financial decisions). in 2013, home prices were falling and interest rates were at a then all time low of 3.25%. I told people 'go buy a home, any home!' people were like 'but home prices are going down' 'interest rates may drop further'. or people were proud and smug that they didnt own a home, as if they achieved something because of the 'losers' that bought homes had their home values go down. but they didnt buy, now those same people are complaining that prices are too high, yet they dont have 7k saved for a down payment.
  - mjevans 6y ago
    You're using averages from a statistically highly invariant sample range. If a mean average is taken of everyone in society and all of the places in society, some fit that might sound reasonable is very likely. However like the article what matters are prices within actual places that people want to live. Like a city they grew up in, a city that actually has jobs, a place with a functional educational system for their children. I assume you and everyone else would like to have service workers inside of big cities? Where should they live? Where should everyone else that isn't in the top 10% of income earners live? How can owning a home close to a job, and actually being able to put down roots and build a community be incentivized? In my mind that is logically divorced from renting and serfdom, and thus housing should be a liability rather than an asset.
DeonPenny 6y ago
Minimum wage workers shouldn't be able to afford rent unless you think every job should automatically align with the ability to be able to rent an apartment minimum. That would necessitate the fact that a medium wage worker would have the ability to rent multiple places. We'd need to build infrastructure and housing so that those medium range workers would and could rent multiple places. Because right now the idea is if you have a medium income you can afford to rent and maybe own a place. Theres not much waste in terms of each medium wage person be allowed a home.
roenxi 6y ago
The capitalist strategy is generally to have so much wealth sloshing around that nobody is paid the minimum wage anyway. Fixating on the situation of minimum wage workers is ok and we don't want anyone to be structurally suffering - but a far better strategy than "affordable rental housing and emergency rental assistance" is to work on increasing the economic prosperity of workers so that the legal minimum wage is just a theoretical thing for underpaid children. If only 2% of people are paid the minimum wage it doesn't matter that only 5% of the housing is available to them. It has been something like 50 years since workers say a real improvement in their wage position. The system keeps encouraging people to play shell games with debt and that really hurts over the long term. Less mortgages. More savings. Cheaper houses. Shorter slogans.
centimeter 6y ago
More accurate: “Minimum wage workers can’t rent a two bedroom and have 70% of their income left over.” Ok; rent a one-bedroom, have a roommate, whatever. Having your own apartment with a guest room isn’t a reasonable thing to expect on the lowest tier of work available. The lowest-value labor in the market being able to support a middle-class lifestyle isn’t a sane thing to expect, by definition. It’s tautologically impossible, unless you collapse middle-class and low-class lifestyle into the same thing.
- anm89 6y ago
  This is not true. There is no law of physics guaranteeing some standard income distribution over a society. There at least hypothetically exists societies with very minimal or no income inequality although in practice this is extremely unlikely. The idea however that the bottom n% of some society have to skew with x deviation from the mean or median is not exactly correct. And the idea that some segment of society will always not be able to afford some amount nominally denominated in that society's currency is explicitly wrong.
  - centimeter 6y ago
    A power law distribution is the expected organic distribution of income and wealth, due to the nature of scale free networks. Only in the presence of massive distortion is that distribution likely to collapse at current technology levels.
scarface74 6y ago
I’ve got a better idea than worrying about the minimum wage. At least for people who are working - get rid of food stamps, get rid of housing subsidies and don’t raise the minimum wage to make it a “Livable wage”. What a livable wage is to my teenage son staying at home is not a livable wage for a single mother of two. It’s no more should be the private sectors responsible to provide a wage that is far beyond market value than it should be the private sector’s responsibility to provide health insurance. Just like we should have universal healthcare to take that responsibility out of the hands of private industry, we should also expand the Earned Income Tax Credit to provide a “livable wage” because it already makes a distinction between my son staying at home and the single mother of two. If we just gave people cash through the EITC and expanded it to encompass food stamps and housing subsidies, it would both ease the administrative burdens on the government and get rid of the nanny state that tells recipients who can live with them and what type of food they should buy. Of course business taxes would have to be raised to support it - maybe. It might be the case where demand side economics would make the entire pie bigger.
warmfuzzykitten 6y ago
And yet, almost all workers live somewhere. Common strategies not mentioned in the article: 1. They live in areas with below average rents. 2. They allocate more than 30% of income to rent. 3. They find other workers to share rent with. 4. They live in studio apartments instead of 1-2 bedroom. 5. They live in rooms instead of whole apartments. 6. They live with family. 7. They live in an inherited home.
anm89 6y ago
The imprecision in the title here is insane. This is is a fully formed sentence which makes an unambiguous claim which is obviously not true, the implicit assumption apparently being that all readers in all cases will be able to properly read between the lines to reparse the title into not being a lie. Minimum wage workers cannot afford some qualified subjective standard rent in any US state. I don't understand how people don't have a major problem with a large news source making blatantly untrue claims.
kingrazor 6y ago
Just doing some napkin calculations, the cheapest apartment I can find right now online in my city is $900 per month. This is including studios. The minimum wage in my state is $11.25 per hour. So working full time at minimum wage, that apartment would be over 46% of your gross income.
ponker 6y ago
Yet, the vast majority of minimum wage workers have found somewhere to live.
- wasdfff 6y ago
  Sometimes in their cars.
deleted 6y ago
[deleted]
albatross 6y ago
I feel like a lot of the debates going on in the comments here are missing the forest for the trees here: Those with much money have too much of it, and those with little have too little. The issue here isn't "the poor need more handouts," but rather, "the richer need fewer." And on that note, I have heard the arguments "hard work will take you far" and "startup CEOs are the hardest working people I know" too many times to count, almost always from people in tech. Single parents working two or more minimum wage (or potentially less if you happen to be undocumented) jobs to feed their children work as hard or harder than any CEO just to get by with the bare minimum. I don't disagree that those who work harder should be rewarded more than those who choose not to, but in what world is the system we all exist in an actual meritocracy?
harryh 6y ago
The title for this post is misleading and should be changed. Minimum wage works can afford rent, just not at the (quite high) standards set in this study: - no more than 30% of income on rent - 40th percentile for rental prices in the location (a mere 10% away from the lake wobegon standard of making everyone above average)

82 points by MindGods 6y ago

SlateStarCodex on why this is deceptive: https://web.archive.org/web/20200303232829/https://slatestarcodex.com/2013/04/04/lies-damned-lies-and-facebook-part-1-of-%E2%88%9E/ https://web.archive.org/web/20200303232829/https://slatestar...

Havoc 6y ago
That appears to be debunking an entirely separate graph with different numbers and likely different flaws.
- ikeboy 6y ago
  The source of the data is ultimately calculated using similar methodology. The flaws described generally apply here as well.
vangelis 6y ago
You get better results if you redefine "unaffordable". Also, the report did specify that 1BRs were also not affordable in 95% of counties going this metric. That's not to say some metrics aren't representative, rent in rural areas and cities in the same states may vary widely. They have it down by county in this report. "Out of Reach is consistent with federal housing policy in the assumption that no more than 30% of a household’s gross income should be consumed by gross housing costs. Spending more than 30% of income on housing is considered “unaffordable."[1] [1] https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2020.pdf https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2...

NovemberWhiskey 6y ago

Am I misreading this: the conclusion is that the lowest earners cannot afford 40th percentile rents?

deathanatos 6y ago
Yes, and no. Directly yes. But no, because the numbers are so insanely over I question whether they can afford 30th or 20th percentile too. It smells like the 40th-%tile is the number that the data exists for. I would welcome graphs showing this data at other %-tiles, and whether that changes the outlook significantly. But the report puts ~50% of the workforce below the national housing wage for a 1-bed. 50% of the workforce cannot all obtain better than 40th %-tile rents.
- NovemberWhiskey 6y ago
  N.B. that the "fair market rent" also excludes public housing rents. Would it be reasonable to suggest that we could expect people earning only minimum wage to be consumers of public housing?

falcolas 6y ago

There's an important caveat, before everyone jumps on the title by itself: > The report, released Tuesday, defines “affordable” as spending no more than 30% of monthly income on rent, in line with what most budgeting experts recommend. The second caveat is this is rent for a 2 bedroom apartment; though they do say that it's also ~95% of 1 bedroom apartments. No comment is made on studio apartments or having roommates. EDIT: The full report this article is based upon: https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2020.pdf https://reports.nlihc.org/sites/default/files/oor/OOR_BOOK_2...

eikenberry 6y ago
> No comment is made on studio apartments or having roommates. To me this is the most telling part. When you are poor you need to have one or more roommates to afford housing and this is not new. What is wrong with roommates? I do think the US could use more small/studio apartment options for those who have a bit more money and prefer to live alone. I lived in a small studio once and enjoyed it, though I usually had roommates.
- dumbfoundded 6y ago
  It depends on what the goal should be. Having roommates is fun when you're 20 something. Not when you're trying to support a family.
  - eikenberry 6y ago
    Minimum wage is not designed to provide enough income to support a family. It it intended to prevent labor abuse.
    - worik 6y ago
      It really should be. Single people on the minimum wage would do very well. Maybe save? What is wrong with that?
      - 6y ago

tathougies 6y ago

Minimum wage workers should mainly be teenagers, young single people, and other dependents who don't need to live alone or for a family, and for whom minimum wage makes sense while they advance in careers. I honestly don't care if minimum wage means you can afford rent. I'm most interested in what percentage of those with dependents are working minimum wage jobs and what percentage of those that started out with minimum wage jobs have been unable to increase their earnings. MY guess is that these numbers are also terrible, but this is the thing to get down. We need to remove minimum wage laws and instead focus on making sure those with dependents and a need to live by themselves have wage growth through their lifetimes. It is no scandal if a young person makes little money at a time in their life when it is okay to live with family or with roommates.

standardUser 6y ago
"Minimum wage workers should mainly be..." Because you say so? Or do you have thoughts on specific policies that will make this true? Because currently, many people who need to support a household rely on minimum wage jobs (or close to it), and often without guaranteed full time hours and no health insurance.
- apsec112 6y ago
  Minimum wage workers are only a few percent of the American labor force, and about half of them are under 25. Only about 20% were between 35 and 55. https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home.pdf https://www.bls.gov/opub/reports/minimum-wage/2018/pdf/home....
  - vangelis 6y ago
    The more interesting data is low-wage workers. Making 10c over the minimum wage would pull you out of that report.
  - standardUser 6y ago
    I'd say 20% is not a small number! I'd also point out that "just above minimum wage" isn't much better than minimum wage. For example, if you work for many large chains that pay minimum wage you're likely to get a raise at some point. That raise may take you from, say, $10.00/hr to $10.50/hr. Hurrah! I think a better metric might be (minimum wage + (20% * minimum wage)). That snags all those people who work at "minimum wage jobs" but have stuck around for a few years and gotten a few small pay increases, but are still being paid a wage that is a function of minimum wage. Just riffing here to be honest, but I do get a little uppity when people claim minimum wage jobs are just for teenagers or other "less important" wage earners. Part of this was from working in retail and food service when I was much younger and knowing a lot of adults, many single parents, working for close to minimum wage. Anecdotal, I know.

rayiner 6y ago

Is minimum wage workers affording an average 1-2 bedroom apartment with no other householders a goal we have set? The French minimum wage is 1,521 euro per month. 30% of that is 456 euros, or about $513. According to the underlying study, the average 1BR in Alabama is $665. Is housing in France, on average, really that much cheaper than Alabama? I don’t think these abstract targets are very helpful. According to the OECD, the US has some of the most affordable housing in the world: https://read.oecd-ilibrary.org/economics/the-average-oecd-household-has-79-of-disposable-income-left-after-housing-costs_21f178bd-en https://read.oecd-ilibrary.org/economics/the-average-oecd-ho... (showing percentage of disposable income left after housing costs). Also, the demand for a “federal affordable housing policy” is pretty breathtaking. Look at the list of states that have the least affordable housing: New York, Massachusetts, etc. A federal program would basically mean bureaucrats from these states would be imposing housing policy on the whole country. That sounds like a great idea!

standardUser 6y ago
Look at it from the other direction. Is working 40 hours per week but not being able to afford a 1 or 2 bedroom apartment a goal we want to set? If so, we have achieved it! I think most of us like the idea that if you put in 40 hours of work every week, regardless of the specific job, you are able to afford a basic standard of living.
- rayiner 6y ago
  You’re begging the question. Is having your own 1BR apartment a “basic standard of living”? When did we decide that? Is that a goal other developed countries have set and achieved? Those are the pertinent questions, not what ideas “we like.” According to the study, that standard would require a $30-40 minimum wage in places like New York. Is that something any country has done?
  - brewdad 6y ago
    Ah yes, the attitude that put a man on the moon. "Nobody else in the world has accomplished this, so why should we even bother trying?"

js2 6y ago

A backgrounder on minimum wage, citing several studies, giving pros and cons, along with a mention of the EITC: https://old.reddit.com/r/Economics/wiki/faq_minwage https://old.reddit.com/r/Economics/wiki/faq_minwage

mjevans 6y ago

Due to how much it cost and also a glut of Federally insured mortgages, housing became a defacto investment for baby boomers. Housing should be a liability, owning land should be a liability. Neither of these should be investments. That's the true solution to spiraling prices.

autokad 6y ago
No. Housing should be an asset. If all housing and land were liabilities, then they would all be owned by the government (we tried that, most people didn't like it). The fact that homes are assets are not stopping people from owning homes (and why the f would someone want to own one if they were a liability in the first place?!?!). the median income in the US is about 60k and median home price is about 200k. you only need 3.5% to qualify for a FHA loan. I managed to save that when I was making less than half of the median income. We dont have a problem of people investing in homes, we have a problem of people not having good financial health (do to their own bad financial decisions). in 2013, home prices were falling and interest rates were at a then all time low of 3.25%. I told people 'go buy a home, any home!' people were like 'but home prices are going down' 'interest rates may drop further'. or people were proud and smug that they didnt own a home, as if they achieved something because of the 'losers' that bought homes had their home values go down. but they didnt buy, now those same people are complaining that prices are too high, yet they dont have 7k saved for a down payment.
- mjevans 6y ago
  You're using averages from a statistically highly invariant sample range. If a mean average is taken of everyone in society and all of the places in society, some fit that might sound reasonable is very likely. However like the article what matters are prices within actual places that people want to live. Like a city they grew up in, a city that actually has jobs, a place with a functional educational system for their children. I assume you and everyone else would like to have service workers inside of big cities? Where should they live? Where should everyone else that isn't in the top 10% of income earners live? How can owning a home close to a job, and actually being able to put down roots and build a community be incentivized? In my mind that is logically divorced from renting and serfdom, and thus housing should be a liability rather than an asset.

DeonPenny 6y ago

Minimum wage workers shouldn't be able to afford rent unless you think every job should automatically align with the ability to be able to rent an apartment minimum. That would necessitate the fact that a medium wage worker would have the ability to rent multiple places. We'd need to build infrastructure and housing so that those medium range workers would and could rent multiple places. Because right now the idea is if you have a medium income you can afford to rent and maybe own a place. Theres not much waste in terms of each medium wage person be allowed a home.

roenxi 6y ago

The capitalist strategy is generally to have so much wealth sloshing around that nobody is paid the minimum wage anyway. Fixating on the situation of minimum wage workers is ok and we don't want anyone to be structurally suffering - but a far better strategy than "affordable rental housing and emergency rental assistance" is to work on increasing the economic prosperity of workers so that the legal minimum wage is just a theoretical thing for underpaid children. If only 2% of people are paid the minimum wage it doesn't matter that only 5% of the housing is available to them. It has been something like 50 years since workers say a real improvement in their wage position. The system keeps encouraging people to play shell games with debt and that really hurts over the long term. Less mortgages. More savings. Cheaper houses. Shorter slogans.

centimeter 6y ago

More accurate: “Minimum wage workers can’t rent a two bedroom and have 70% of their income left over.” Ok; rent a one-bedroom, have a roommate, whatever. Having your own apartment with a guest room isn’t a reasonable thing to expect on the lowest tier of work available. The lowest-value labor in the market being able to support a middle-class lifestyle isn’t a sane thing to expect, by definition. It’s tautologically impossible, unless you collapse middle-class and low-class lifestyle into the same thing.

anm89 6y ago
This is not true. There is no law of physics guaranteeing some standard income distribution over a society. There at least hypothetically exists societies with very minimal or no income inequality although in practice this is extremely unlikely. The idea however that the bottom n% of some society have to skew with x deviation from the mean or median is not exactly correct. And the idea that some segment of society will always not be able to afford some amount nominally denominated in that society's currency is explicitly wrong.
- centimeter 6y ago
  A power law distribution is the expected organic distribution of income and wealth, due to the nature of scale free networks. Only in the presence of massive distortion is that distribution likely to collapse at current technology levels.

scarface74 6y ago

I’ve got a better idea than worrying about the minimum wage. At least for people who are working - get rid of food stamps, get rid of housing subsidies and don’t raise the minimum wage to make it a “Livable wage”. What a livable wage is to my teenage son staying at home is not a livable wage for a single mother of two. It’s no more should be the private sectors responsible to provide a wage that is far beyond market value than it should be the private sector’s responsibility to provide health insurance. Just like we should have universal healthcare to take that responsibility out of the hands of private industry, we should also expand the Earned Income Tax Credit to provide a “livable wage” because it already makes a distinction between my son staying at home and the single mother of two. If we just gave people cash through the EITC and expanded it to encompass food stamps and housing subsidies, it would both ease the administrative burdens on the government and get rid of the nanny state that tells recipients who can live with them and what type of food they should buy. Of course business taxes would have to be raised to support it - maybe. It might be the case where demand side economics would make the entire pie bigger.

warmfuzzykitten 6y ago

And yet, almost all workers live somewhere. Common strategies not mentioned in the article: 1. They live in areas with below average rents. 2. They allocate more than 30% of income to rent. 3. They find other workers to share rent with. 4. They live in studio apartments instead of 1-2 bedroom. 5. They live in rooms instead of whole apartments. 6. They live with family. 7. They live in an inherited home.

anm89 6y ago

The imprecision in the title here is insane. This is is a fully formed sentence which makes an unambiguous claim which is obviously not true, the implicit assumption apparently being that all readers in all cases will be able to properly read between the lines to reparse the title into not being a lie. Minimum wage workers cannot afford some qualified subjective standard rent in any US state. I don't understand how people don't have a major problem with a large news source making blatantly untrue claims.

kingrazor 6y ago

Just doing some napkin calculations, the cheapest apartment I can find right now online in my city is $900 per month. This is including studios. The minimum wage in my state is $11.25 per hour. So working full time at minimum wage, that apartment would be over 46% of your gross income.

ponker 6y ago

Yet, the vast majority of minimum wage workers have found somewhere to live.

wasdfff 6y ago
Sometimes in their cars.

deleted 6y ago

[deleted]

albatross 6y ago

I feel like a lot of the debates going on in the comments here are missing the forest for the trees here: Those with much money have too much of it, and those with little have too little. The issue here isn't "the poor need more handouts," but rather, "the richer need fewer." And on that note, I have heard the arguments "hard work will take you far" and "startup CEOs are the hardest working people I know" too many times to count, almost always from people in tech. Single parents working two or more minimum wage (or potentially less if you happen to be undocumented) jobs to feed their children work as hard or harder than any CEO just to get by with the bare minimum. I don't disagree that those who work harder should be rewarded more than those who choose not to, but in what world is the system we all exist in an actual meritocracy?

harryh 6y ago

The title for this post is misleading and should be changed. Minimum wage works can afford rent, just not at the (quite high) standards set in this study: - no more than 30% of income on rent - 40th percentile for rental prices in the location (a mere 10% away from the lake wobegon standard of making everyone above average)