Minimum wage workers can't afford rent anywhere in America
cnn.com
cnn.com
The study found that the minimum wage isn't enough to afford the average fair market rent for a two-bedroom rental.
Trying to compare average rents to minimum wages doesn't make sense, as anyone earning minimum wage wouldn't be in the market for an average-price two-bedroom rental. It would have been more useful if they had studied something like bottom decile wages compared to bottom decile rents.
Also, compare rents and minimum wage in say, 1979-1982 to now.
Yes, the study would have been more useful if they examined whether or not minimum wage could afford any two-bedroom, not the average two-bedroom.
It's the mixing of minimum wages and average rents that is misleading. We need to look at minimum wages compared to minimum rents, not average rents.
The current title is misleading as it's not true that minimum wage cannot afford renting at all. They can, for example, afford cheaper-than-average two bedroom apartments.
It's just arguing about the misleading title...
There are another 3000 hunter-gatherers who have hoarded 90% of the resources. If we split up the resources more equally we could support everyone easily.
We have more empty houses than homeless in the US. We should be able to guarantee food, water, and shelter to every citizen, even if we don’t necessarily guarantee it’s in a place someone desires.
We aren’t productive enough as a society to be able to give everyone pleasure constantly but we are certainly productive enough to guarantee basic physical needs for survival
How many people experiencing houselessness are you willing to ship off to rural Nebraska where they know nobody, have no support system, no supportive services, and probably are grossly unfamiliar with the local culture?
Is your answer "all of them"? Perhaps with some qualifier about how they'll receive food, water, and free transportation to this location?
You're absolutely right. Our society is unquestionably wealthy enough to provide for the basic needs of all. You are experiencing a beautiful blossoming of genuine human compassion. It's just perhaps possible that this might be a chance to think more precisely about how to translate that into policy.
We're not shuffling people around for the sake of getting them out of the area. we're shuffling people around so they can move to an area that has a better job market relative to local rents. This is supposed to address the "they can't move to find a better job because they can't afford the cost of moving" objection a few comments up.
>We have more empty houses than homeless in the US.
A sibling comment has addressed this so I won't go into this further.
>We aren’t productive enough as a society to be able to give everyone pleasure constantly but we are certainly productive enough to guarantee basic physical needs for survival
Because it's a political problem (ie. NIMBY), not a economic one.
The solution clearly involves building sufficient housing and/or raising the minimum wage.
Making the numbers more right doesn’t make the reality any less cruel, and more accurate numbers don’t seem to help persuade anyone to care. So it’s legitimate to say “could be better!”, but that’s often viewed as important relative to the issue itself: people can’t afford a home in America.
As, per that definition, wages are now not normally distributed anymore it (statistically) does not even make sense to talk about average (i.e. mean) wages anymore.
More anecdotally: I recently looked up mean and median wages in Germany. And what I found is that the median netto income (per employer) does not really differ from the netto income per household. I guess that means that the average German household only has one person working (while the other is probably taking care of potential kids).
...and that's how you end up with polarization with media. Neutral/objective reporting gets dropped because it "seem to help persuade anyone to care". It's replaced with misleading reporting optimized for shock value which gets a pass from one side because it fits in with their narrative, but is rejected by the other because of how biased it is.
Should everyone be able to afford the average rent?
It is a moral failure of our society - where there IS so much wealth - that so many struggle so hard just to put a roof of their heads. It's a worse failure still that anyone goes homeless.
The reason you can't afford rent is because our housing policies make home ownership a highly-leveraged, government-backed investment that's guaranteed to appreciate exponentially forever
It's not appreciating, it's pacing real inflation, if you're lucky.
You can tell by comparing it to other significant $USD priced items over decades: gold, oil, healthcare, education, cost of a new car.
Housing isn't even outrunning the price inflation on new cars (a purely capital eating monster). In 2000 the average price of a new car was $21,000; today it's $41,000 (no joke). In 2000 the average home sale price (not new homes, any homes), was ~$205,000; today it's a bit over $400,000.
Most people get their asses handed to them in real terms on their home 'investments.' Inflation alone is enough to ensure they don't earn a real return. And then once you add in maintenance, repairs, interest, insurance and property taxes, forget about it. Housing as a good investment is one of the greatest financial frauds ever sold to the masses. It only works on average in fantasy if someone drops context of the total cost across 30 or 50 years. For the average person it becomes a very mediocre form of savings.
China's cheap manufacturing spared the US a significant cost of living beating over the past 20 years, by supplying a vast deflationary push down on US consumer prices. That shielded households from some of the currency destruction (inflationary) hit that is more widely reflected in the prior mentioned USD priced items.
Most homelessness is temporary, and there is a lot of assistance in a variety of programs to help people in that situation. Most chronic homelessness is tied to mental health issues and / or drug abuse among people who refuse treatment, and would exist independent of minimum wage and rent levels.
Source: an ex and relatives who work with the homeless community.
Handwavy nonsense. There are lots of places in the world where three or more people live in the space of a studio apartment.
The point being not that this is a reasonable standard of living, but that what can be asserted without support can be dismissed without support.
In the US, some CPS will require kids to have their own bedrooms. Certain states also have housing laws requiring kids of certain ages to have their own bedrooms, as well. Property owners who take government housing benefits are also required to make sure children have their own bedrooms.
AFAIK, rules of that type in state law, regulation, or child services practice generally apply strictly to substitute placements like foster and prospective or probationary adoptive homes, not regular custodial family settings, and even then usually allow room sharing for all of infants with parents, with children under a threshold age (commonly 5 or a little older), and children of the same gender regardless of age, though there may be numerical limits to each.
If you can cite a specific rule or supportive case that not having their own room alone can be a basis for CPS action anywhere in the US against a parent with permanent custody, please share.
> Property owners who take government housing benefits are also required to make sure children have their own bedrooms.
No, they aren't. In fact, subsidy programs often set a maximum number of bedrooms of a subsidized unit as number of people/2, rounded up to a whole number [0], absolutely preventing each child from having a bedroom unless there is exactly one child. Which is one reason the earlier claim about CPS is not true.
[0] for an example, see https://www.scchousingauthority.org/section-8-current-partic... — note that the 2 occupants per bedroom standard is a national HUD standard (stemming from the 1991 Keating memo, subsequently mandated for adoption as HUD policy by the Quality Housing and Work Responsibility Act of 1998.)
In a single-parent family, one child wouldn't even qualify for a second bedroom under HUD guidelines. Now, its true that many child welfare rules wouldn't allow a placement to a foster or adoptive home that would force parent/child bedroom sharing, but neither would they prohibit it for an existing permanent family.
> The kids need another bedroom.
Again, if you have evidence such a rule exists, please present it.
This is changing the goalposts. It's no longer "Minimum wage workers can't afford rent anywhere in America" but rather "Minimum wage workers can't afford rent anywhere in America if they're single parents". Just for kicks you can extend this arbitrarily. Why stop at kids? What about your mom and dad too, for a multigenerational household?
By design and intent, it's supposed to be enough to raise a family on one income.
What’s wrong with there being a system in place that ensures that everybody, irrespective of having gone through divorce, or death, medical issues etc, has a chance to survive with a roof about their head and some food on the table?
A lot has changed since when it was first enacted. Most notably, families switched from single earner to dual earner.
No disrespect is intended to anyone, but by definition a person making minimum wage is poor and why can’t they live in a single bedroom apartment or even a studio. Where does it say that minimum wage = every occupant gets their own bedroom?
In large parts of the world families share bedrooms.
Please note I’m not saying these people should not try to better their lives, but people making minimum wage need to compromise.
I simply was trying to say that minimum wage has a definition, and I’m assuming that definition is safe housing and sufficient food and other necessities. I’m assuming that it does not mean a certain size of housing, designer clothes, eating out a certain times a week and so on, since after all by definition it is minimum.
2) Having children while on minimum wage is child abuse. Similarly, nobody owes them the right to have children, and nobody should be obliged to pay for such profligate hobbies. Perhaps they should devote the time and resources otherwise spent on child-rearing to create more value for others first.
Isn't that what the article is saying?
If you listened to the propaganda, you'd think it were 20% of the laborforce.
Which warrants a few other questions, including how many of those minimum wage workers are living with their parents rent free, what the average age of those workers is, and so on.
This study instantly becomes that much more absurd if you actually analyze the minimum wage worker segment. It ends up you're talking about 1/20th of 1% of the laborforce that it reasonably applies to.
This excludes 865,000 who reported making less. And a probably much larger number making local minimum wages. And any self employed or salaried workers who make minimum wage or less effectively. And anyone making the slightest amount more.
It's easy click-bait, but maybe a news organization and do some reporting on the actual living conditions for minimum wage workers since they're clearly living somewhere.
The article really means a minimum wage worker cannot afford a 2-bedroom place. The larger problem is that in 93 percent of the US, they cannot even afford a 1-bedroom place.
It can be hard to find something smaller than a 2-bedroom place. We have torn down a million SROs and largely zoned out of existence the ability to create new Missing Middle Housing.
https://en.m.wikipedia.org/wiki/Single_room_occupancy
https://missingmiddlehousing.com/
The real problem here is a general lack of housing stock of a certain kind: Smaller homes in walkable neighborhoods that remain affordable and haven't become crazy expensive due to being part of an older vibrant area in very high demand.
I used to think that rents are simply a function of supply and demand, but recently I realized that there's also a floor for rental prices regardless of the demand. That floor is a function of the cost of buying a house, property tax, and the opportunity cost (eg: stock market will give me an ROI of X, so real estate has to be within that range or I'll just move my assets accordingly).
I am only familiar with the SF market so the rest of the country might be totally different, but having looked into buying a house there I can totally understand why the floor for rental prices is as high as it is. The property tax is 1.2%, and good luck with buying something under a million dollars where you can expect to attract people with steady income. Last but not least, if we're really going to compare this investment with the stock market, then I shouldn't be expected to worry about water leaks and clogged toilets, so we should also include the cost of a property manager. In short, no thank you.
Raising the minimum wage would lead to higher prices, lower sales volume and lower sales tax. Is it possible to take that same budget and instead make more land available for development, lower the property tax, and make other moves to make home ownership more attractive? That should also lower the cost of rents.
It’s almost like the middle class feels threatened like they’re being devalued or something.
I wonder who takes minimum wage jobs, even in 2016. There were plenty of 10$/hr jobs. You'd almost have to look for them.
While Texas and San Antonio don't have higher legal minimum wages than the federal minimum, effectively nobody is earning the federal minimum because nobody will work for the federal minimum. Even gas station clerks and grocery store shelf stockers in San Antonio make at least $12/hr. The "nice" gas stations pay $14/hr /starting/ and up to $18/hr. This is in one of the lowest cost of living and lowest median earning major cities in the US.
It's simply not helpful to compare the bottom legal possible wage to average costs for a two-bedroom rental, when the typical bottom wage is much higher and most individuals earning these wages don't rent a two-bedroom apartment by themselves, they have room-mates or are part of a family unit where the cost of rent is shared.
Why punish the businesses specifically? If society wants to provide a minimum standard of living to its members, then the burden should be borne by everyone. Goldman Sacs certainly isn't paying the cost of this program, for instance.
Which is why rising energy prices and increased taxation are bad for the same classes of people. Both contribute to raised prices, which puts people without equity investments at a disadvantage.
We need sensible economic policies. Without them, the wage / class gaps will continue to widen.
Get a roommate. Horrible, I know.
[0] https://www.bls.gov/ect/compensation-percentile-estimates.ht...
If 10th percentile earners are renting 50th percentile housing, who exactly are the folks who are going to be renting say the 10th percentile housing?
Personally the entire concept of "I own one of the basic pillars of your survival, pay me for shelter" never really sat well with me.
But if we're just making a value judgement on "deserved" I'd think the people who keep society together for the rest of us should get a pretty big seat at the table
It's not even positive to me that any specific group of non-minimum-wage earners are holding society together either.
Or the endless snarky remarks plastered on restaurants about "nobody wants to work!"
Napkin math shows that, to afford a $13.5k tuition bill, one must work 1564 hours for the university. They cap you at 20hrs/wk so as not to overburden you, so you can pay off your tuition bill in a mere 78 weeks. I go to one of the least expensive state universities.
A minimum wage raise would not be merely symbolic, at least not in Texas. If my university paid $12/hr, it would take 55 weeks to pay off tuition and at $15 it would take 44 weeks.
I don't know what the deal is with your university in particular, but your local Amazon warehouse is paying $15 an hour as that is their national minimum. Walmart just recently announced they are moving to $15 nationally as well I believe.
Tipped server jobs are actually in somewhat high demand around here since people generally tip well, especially with restaurants moving to those Toast PoS systems that prompt customers to tip.
I do wonder why that town has wages so far below what I'm seeing around. Perhaps this has something to do with it being a university town and having lots of unskilled labor? I also do wonder if it being a self fulfilling prophecy is also a possibility, if you get a bunch of people together who belive that wages are lower then they are, a savvy busineessman might make that belief a reality. Either way it's a interesting case study, thanks for sharing your experience and I will consider it further as I continue to look into this topic.
I personally have a remote sde job, so all of this is anecdata I've collected from those around me, alongside seeing job postings out and about.
Social housing is a different story. Where I live, it's notoriously hard to get into (waitlists of 8 years or more), has strict income requirements (get a raise? lose your home!) and is often poorly maintained because anti-poor city politicians wont make the investments necessary to improve and expand it.
Most other programs that we're told exist to help the poor are similar. They're limited, means-tested, complex to apply for, and often still short of what's needed.
Minimum wage is a ridiculous concept. Why make it illegal to accept wages below certain levels? The only thing it does is increase unemployment.
I'm not very strong on economics so mine is likely a foolish perspective, but I always thought minimum wage existed to prevent a race to the bottom where the bottom is asymptotic? Since there are companies getting away with paying minimum wage now, doesn't this indicate that they're fine paying as little as possible but also aren't lacking in employees? Corporations already have such one-sided power over job seekers (I know that I as a dev am guilty of forgetting this from time to time), I find it very difficult to believe that without a mandated minimum, there would be no shortage of companies eager to get away with paying even less. They're doing it now and being successful, why wouldn't they do it then and be successful?
And we can say all day and all night how "the market will correct this, no one will work for them!" but clearly since there are people working for the absolute minimum right now, there would be people working for the absolute minimum then too; the only difference is that the current minimum is set by the government and this theoretical minimum would be set by each individual corporation. I may not have a lot of faith in the government, but I sure know which of those two I'd rather rely on in this case.
But again, I have no formal econ education, so I'll confess I don't know anything about anything. Genuine question: how does minimum wage increase unemployment? Sure, if Alice was earning minimum wage, her boss could hire Bob at half minimum wage if Alice took a 50% pay cut, but how does that actually help Alice or Bob? Yeah, unemployment drops, but welfare claims and poverty levels skyrocket as Alice joins Bob in the welfare system. I just don't see it, but I'm clearly missing something.
I could somewhat agree with this argument if we had better sex ed, better access to contraceptives, and better access to abortions. All three are clearly getting worse in Texas.
I've removed it from my vocabulary hoping to do a better job asking myself "why do I expect that?" and "why would that be good?"