MIT Living Wage Calculator
livingwage.mit.edu
livingwage.mit.edu
Through mid life, your financial health is not as determined by wages, but by your family/connections. Do you have access to a grandmother who can babysit? A decent second-hand car? A good roommate situation? Just look at the expense table - any one of these things could be worth up to 20% of your income!
And you see that literally right here - are any of us actually comfortable with the idea that the value of your labor should be determined by your marriage status and number of children?
It's kind of telling that countries with "successful" minimum wages either don't have one and just institutionalize collective bargaining, or they do some fancy calculations that start with prevailing median wages and welfare eligibility. The idea of trying to get this number from the bottom up by building expenses just doesn't seem very robust.
Same when I help my siblings. If they pay me back, now I'm taking away from my nieces and nephews. Within friends/family, I think it's completely reasonably if the money flows "downhill".
This is the fundamental concept of the vast majority of taxes, including those that feed the poor/unemployed: that money is gone, somewhere between little and no personal return, but that usually makes sense, increasingly so with income.
It's kind of like the physics joke about assuming a spherical cow in a vacuum.
Private industry should concentrate on paying people their market wages. Government should tax industries and individuals and provide a safety net.
Let me tell you from first hand experience what happens when unions get involved with manufacturing industries where they can pick up and go elsewhere - they do. Growing up, the city I lived in had 5 factories - all but one left because of fights with unions.
Where I use to live in the burbs of Atlanta, according to the website, the living wage is $45 an hour. Should we have a minimum wage there of $45 an hour?
This has literally happened even in Big Tech, leading to lawsuits within the last decade.
If a business can't pay a person working full time to satisfy their basic needs, their business model is not viable. If they can and don't pay so, it's plain exploitation. Ex. Walmart employees can't support themselves and rely on social services despite having a full time job.
While the first generation American has to scrounge up for a franchise that only nets $70K a year?
Bobs uncle doesn’t have the kind of money that YC has. It’s the ultimate hypocrisy and “let them eat cake” kind of talk.
Because if they don't, they are externalising the true costs of labour to the government, or the community.
Which is fine, by the way, but they cannot then turn around and oppose the cost of taxation needed for gov programs which support people who aren't receiving that living wage. Nor, and worse still, oppose a living wage and then force work people to work such long hours that they cannot sustain a community that can provide the extra support needed to maintain a decent life.
Does this mean anything or is it a circular definition?
If we decide we'd like people to have at least the standard of living of a single person earning $40/hour, does that make $40/hour the "true cost of labor"? Could we just as easily raise our standards and say $50/hour is the true cost?
The living wage is higher than what you would often have with no government intervention or safety net, so it's not a natural cost of labor in that sense.
You can change the set of stuff, but it's much harder to cheat if you actually have to say what a living wage should be spent on.
I'm asking about the sentence I quoted. What makes the living wage the "true cost" of labor? Why consider it to be a cost that private industry should rightfully pay, and if they don't, they're "externalising" it to the government?
By the same logic, isn't nearly all government spending just externalized costs? When the government pays for roads or police, are these also externalized costs that private industry should pay for?
It sounds like a minarchist viewpoint, where government spending is kept to a minimum and services are privatized.
> “It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living.”
> FDR
It was supposed to be a "living wage".
Letting companies pay less than a living wage and providing a robust government safety net just subsidizes businesses using government tax money. The biggest beneficiaries of this are companies like Wal Mart, who gets effectively subsidized to the tune of $6B+ a year because so many of its employees are on SNAP and similar low income programs[1].
[1] https://www.ufcw.org/press-releases/wal-mart-has-highest-num...
Everyone loves bringing up Walmart. But should that franchiser who is only netting $70k a year now also be paying $35 an hour?
And again, I find it rich that tech workers living off the tits of VC funding can tsk tsk about companies that need to actually have a profitable business model can’t pay their workers $75k a year (the living wage for Forsyth county, GA) no matter what their job is.
But nobody is advocating for setting the minimum wage equal to what it would cost to comfortably live in the wealthiest part of a state.
I didn’t randomly choose Forsyth County. I use to live there.
Or should they have to do an hour commute from a lower cost of living area in metro Atlanta?
What is living wage based on single? Head of household with kids?
Many young people I know live on much less than this.
This is more like “optimal wage to live alone in my own apartment with a car.” Which of course, people would like to have but certainly isn’t required to be comfortable.
For example, transportation costs are $9000/year and housing is $20000/year. These are both way more than is necessary.
They need better branding because calling this a living wage is a misnomer and harming their cause.
The minimum wage is far below what it takes to actually 'live', like have a place to live and a car.
Edit: also the housing cost is probably factoring in a studio or maybe a 1bd for a single person. That may seem luxurious to you, but for many that is the only real option they have (roommates are hard to come by and can hurt you physically and fiscally).
In my 20s everyone I knew had roommates. And it was a good life.
Saying a studio or 1 bedroom is required makes this metric pretty ambiguous.
Thus my point, that this isn’t what’s required to just live. But to live comfortably.
After looking at the method, I think the calculator probably has some bias towards “what society has convinced us we need”. To a certain extent that is a relative and subjective perception problem, and one exacerbated when you live in a society with a lot of consumer debt.
6-8 servings of fruits and vegetables a day, fairly liberal amounts of dairy and lean protein, lesser amounts of red meat. Grains like breads/rice for additional carbohydrates.
Admittedly, avoiding eating out regularly is the #1 way I keep food costs down, though.
Behold, "averages" are not perfect.
But we stick to the essentials, utilize different stores for the lowest prices we can get, and don't purchase nonsense.
Ie “averages” with large variances are not often very informative
The average wealth between me and Elon is several hundred billion dollars. That gives you very little information about me. Which is why people can hang too much inference on a simple average. Like Nate Silver said in The Signal and The Noise, the real discussion for the data literate is about uncertainty in models, not just drawing conclusions from “averages”
You're able to purchase groceries for your family, for your diet, in your locality, from your available stores, for less than the stated average.
You think the diet should be different, and blame "society!" for the nutrition goals not resulting in a lower budget.
This is not a serious criticism. It is an unverifiable anecdote coupled with generic contrarianism.
The fact some people spend more or less on groceries is already factored into the data, as it's an average of prices. Averages are imperfect. The fact it's an average of prices (instead of spending) makes it slightly better, but anecdotal data doesn't meaningfully contribute to a discussion about it.
The diet, too, is probably imperfect, but the tool needed to normalize costs, not assemble a Costco rice-and-beans nutritionally complete diet to minimize costs.
So I have absolutely no idea what point you're trying to make beyond "I like to sound smart."
And that doesn’t mean the method has to be perfect. But if it doesn’t reflect the true problem, or if is too weak to drawn conclusions from, it’s just story-telling.
The point I’m making is we should acknowledge the model assumptions. If we’re saying, for example, a living wage is expected to provide the average car, we need to acknowledge it now becomes the floor and is no longer the “average”. That’s a fine point to debate, but it requires some data literacy that is absent in this discussion.
And, as an aside, if you think snark is somehow justified because someone is criticizing a tool or method in legitimate way that you don’t like, you need to revisit the HN guidelines.
All you have said is "the average doesn't match my experience" and "diet bad."
Neither of those are methodological criticisms.
They're just saying things.
Significant parts of the method are built on surveys. Surveys are often a poor measure because they tend to be more subjective and biased. That’s why nutrition surveys of dietitians have significant amounts of error. In addition, the surveyed data isn’t normalized for socio-economic class; that is, it sets the expected value at the “averages”. The implication is the living wage should provide the average level of subjective consumption. That, in turn, means the current average is now the lowest we are willing to accept as a society. That’s all well and good to discuss, but that’s more nuanced than anything you’ve brought up. And that’s doesn’t scratch the surface of the flawed reporting, where uncertainty isn’t part of the main discussion.
It’s clear the site is for laity but the problem (as we’ve seen) is that it just feeds people’s confirmation bias when they are more interested in being right than in understanding.
I don’t consider daily or even weekly restaurants part of a necessity for life.
Not everybody is like you.
Restaurants have never been a necessity for life, but I guess that for a lot of people you should be upper class to eat out once a week.
You don’t need to buy food in bulk. Just buy regular food, cook it, and take it to work.
Either take stuff that doesn’t need refridge (pb&j, hummus, etc), or insulated lunchbox, or thermos.
This is not a complicated problem to solve. Ride the bus sometime and look at the lunches people bring long distances.
Eating out isn’t a necessity. But at $12/day food budget you definitely have money left over to eat out every once in a while. And that if you cook only for yourself. If you’re part of a household who can share food, it’s even easier.
A 10 oz ham sandwich will probably cost you more than 2 dollars even if you buy everything at the supermarket. I don't know why people are so reluctant to admit that 12 dollars a day is not much for groceries.
There is no getting around the fact that $12/day buys a lot of good groceries even in expensive cities. Cooking is trivially learned, especially these days with the Internet. The people claiming that eating on $12/day is challenging are really saying that they can't support their affluent lifestyle on $12/day. Which is true! But it reeks of learned helplessness.
As someone who lived decades of their life in real poverty, I find most of the discourse around a "living wage" to be deeply unserious. Things that are completely normal and healthy in low-income communities across the US are presented as unachievable despite millions of examples to the contrary. Living well as a low-income person is a skill. It is obvious that many people with strong opinions on the matter don't have any expertise at it.
The only reason I still regularly eat the same kind of food as when I was poor is that it is objectively delicious and healthy, cost doesn't factor into it. I can afford to eat whatever I desire.
>The people claiming that eating on $12/day is challenging are really saying that they can't support their affluent lifestyle on $12/day. Which is true! But it reeks of learned helplessness.
I guess I was affluent and didn't know it.
Honestly, the worst part by far was transportation. Everything else kind of worked.
Are you aware that many people do this every day? This is a solved problem.
1/5 lb of ham @$2.5lb is $0.50. A slice of cheese @ $2.50/lb is about $0.20. Two slices of homemade bread is about $0.20. I don’t know how much you’d add for vegetables or condiments but it ain’t much.
I would expect living wage to mean the amount one needs to be able to live out your life fairly decently and with dignity. I think many do so without having pay this high.
Needless to say; only old people have homes and only those who have sufficient help get a nice appt.
This is a debatable goalpost. It seems more reasonable to me to assume that meeting basic shelter needs includes having a private room to oneself. The only reason to argue otherwise is to try to drive down the wage further, and is that at all necessary? Renting a private room was possible on nearly any wage 50 years ago, and the only reason it seems out of reach for many now is because purchasing power has been slowly stagnating for decades, while housing costs have soared in recent times. Yet this whole time, GDP continues to rise. It seems that our society can easily support much higher minimum wages (and this would likely have only a positive effect of stimulating the economy), but simply chooses not to.
I think it's reasonable for young people to have flatmates and share an apartment, for example.
These are all real situations that make me think that pinning "living wage" to a level where you have to have roommates is not a good goal. You're basically asking people to survive by accepting unstable living conditions and potentially taking strangers into their homes, which isn't exactly "having your needs met."
When did a 450 sqft studio apt become a luxury? Why should it? That's a tiny amount of space. People should be able to afford that.
Theres also lots more people, and as more people consume more resources it does not follow that better technology in some field will translate to increased every aspect of life.
It's not "student wage". It's not "struggling young person" wage. It's "living" wage. It's for living - at any age.
Eg does that quants internship get a lower pay because they are expected to graduate beyond it? If so, how do we define what jobs are stepping stones and which are long-term careers?
There are many ways to accomplish this beyond simply raising wages. Better government programs, lower the cost of housing/medical/transportation/food/etc. (these are surprisingly simple but many vested interests don't want this to happen), better retirement programs, etc. etc. etc. You see more of this in more socially democratic countries.
(Lowering the cost of essential goods and services is also something that can be done by leveraging the open market. It doesn't take yet another wasteful government program, which is the typical approach in socialist and social-democrat countries.)
With a lot of these discussions, we need to be careful about the seductively simple solutions.
I remember a radio interview with a fast food worker who’s response was basically “I like my job and don’t want to do something else, but I just want it to be a higher wage”
A living wage is for living indefinitely, not just surviving. That should afford more comforts like a reasonable amount of space, a car if needed, and saving for retirement or emergencies.
Pick IL for example. Min wage $15, so $30k a year income fulltime. Most every adult that’s worked even a little should be able to earn decently more than min, which is for completely unskilled, new workers. Median il wage is 66k.
Even at $30k, the rough 30% rule on housing is $750/mo. At 66k it’s over $1500/mo.
Dig through smaller cities, and you’ll find apartments to rent in either end of this range. This works in any state.
(Which in turn opens up opportunities for others to move in to the higher-cost places and boost their own productivity.)
Historically housing was much smaller. And people lived with their families for a lot longer commonly. A lot less was also spent on domestic appliances (not just washer & dryers) and at-home entertainment (a lot less was spent on entertainment in general).
If it is reasonable for a young person to have flatmates, then that should be because they are a student or an artist and are working only part-time while devoting the rest of their time to their studies or their art.
But a person working full-time? Who may be a single mother or father with a child to support? They should be able to afford a place to live, without roommates.
Why would that be reasonable? College students and young adults usually have roommates. I don't feel it's inhumane.
> The only reason to argue otherwise is to try to drive down the wage further
Another reason to argue otherwise is because you care about the truth. Even if you and I agree on the ends, if you use the means of exaggerating or stretching the truth to get there, you are never on my side. Saying that you need to not have roommates to live is an exaggeration.
> Renting a private room was possible on nearly any wage 50 years ago
You will never find any data to support that because it isn't true. 50 years ago, flophouses were common. You would share a bedroom room with others, with shared kitchen and bathroom between multiple bedrooms. In college, I lived in a housing-coop network where we slept two to a room. 50 years ago, they slept 4 or 6 to a room in my exact house.
> and the only reason it seems out of reach for many now is because purchasing power has been slowly stagnating for decades, while housing costs have soared in recent times
This is true. But there is a very natural reason why. Look at nearly any US city, and see how many more jobs there are in that city than there were 50 years ago. Then look at how many more homes there are in that city than there were 50 years ago. You will see that the number of new jobs far exceeds the number of new homes. The result is that wealthier people bid up the housing, while poor people are forced to live outside the city and commute. So why have no new houses been built? It can't be helped by the fact that building new homes is illegal. (e.g. buildings with 3 or more apartments are illegal in 70% of san francisco.)
Please direct your anger in the right direction! It's not generally the case that billionaires own thousands of homes, hoarding them while the poor live on the street. It's more often the case that the population has increased while the number of homes in places people want to live has stayed the same. The *only* solution is to increase the number of homes in places people want to live. Raising the minimum wage, taxing the rich, fighting corporations, adding rent control laws, none of that will help solve the root of the problem, the growth rate of homes in cities is far slower than the rate of people wanting to live there!
50 years ago, in high cost of living areas, you could rent an SRO, but now they're either banned or practically banned because they're strongly disincentivized against. Combine this with not building enough new housing and you get a recipe for rent increases. Even if a minimum wage works as intended, it can only subsidize demand, which would do nothing when the bottleneck is the supply.
I think others pointed this out but I don't think you can find any data to prove this because its not true.
I'm not a historian but I have seen a number of old movies and in those movies it was very common for the characters to be some poor schlub with a full time job at the factory living in some sort of group home/flophouse situation. Movies tend to reflect stories that resonate with the public at the time so I suspect that is because this was a common situation. I'd much prefer a single roommate in an apartment to a flophouse.
What math are you doing to get $130k with those numbers? That wage works out to around $60k/year.
130k/yr is more like 65/hr.
The calculator suggests $5,021 for food, but for me I’d only shop at high-end grocery like Whole Foods and buy organics whenever possible. That’s clearly not enough. On the other hand it suggests $1,792 for internet and mobile which is about double what I actually pay and I have both unlimited mobile data and unlimited home data. Then it claims medical costs of $2,890. For a fit individual with good employer-provided health insurance, that figure should be almost zero.
Ultimately the amount one spends for living depends very much on one’s preferences and these calculators are approximates. I believe you when you say many young people can live for much less, but that doesn’t invalidate the calculator.
No, it won't be almost zero because they're including health insurance premiums in that figure. Few jobs in the US cover 100% of the premiums for their employees.
>> The cost of health care is composed of two subcategories: (1) premiums associated with employer-sponsored health insurance plans and (2) out-of-pocket expenses for medical services, drugs, and medical supplies.
Because preferences for food, housing, and healthcare are essentially unbounded, I think you will always have unmet preferences.
It must be more nuanced than you say, as millions of people reach old age without sharing your concern.
The average person is not-quite healthy, at best.
Not to mention you need to be able to save money for unemployment and rainy days..
$9000/year is a ton more than just having a car.
You don't actually need a car unless you have a child or a tradesmen with tools or something like that, a small displacement motorcycle will still take you to 99.9% of the jobs in the lower 48.
(don't worry about how to pay the ambulance bill when you hit some black ice..)
9000/yr for a car alone isn't crazy at all, just look at average car prices. I just had to do my vehicle renewal today and it was $500 for a 5 year old car that's not particularly expensive! If I look at insurance and car payments, I easily spend over 700 a month. This is on a 30k car, so it's not like I went and bought the biggest luxury vehicle possible.
Eventually there has to be a mechanism that continues providing liquidity for nothing or...
An appartment and a car aren't exactly luxury goods. Cars are often needed to work, and well, having a roof over your head is usually required for a decent living.
Sure, if you fancy living in a cardboard box located next to your work, your living standards are going to be much easier to attain.
Their cost estimates are much higher than what’s required to live comfortably and save for a rainy day.
Even on the smaller things. "Internet & Mobile" for where I am jumped out to me. Based on the difference between 1 adult and 2 adults, it's $582 per person-year for mobile (which I guess isn't far off if you get a good new phone every 2 years, it's reasonable enough) and with that subtracted, internet is $100 per month. The methodology page says "County-level data on the cost of internet comes from research on lowest-cost monthly plans from BroadbandNow", but even that page shows much cheaper options available (including the $70 per month Google Fiber I have).
I was surprised (at least for Birmingham/AL/Jefferson County) how accurately it pegged _most_ of the costs -- childcare here is closer to $12k/annum/child so that one was the only one I pegged as 'off' - they show 2 children as $16k and that's a ~$8k underestimate
I spend $20/month for mobile and buy a new $500 phone every 3 years.
I make way more than a livable wage, but spend much less than their projected costs.
If you can't live alone with a car? Then what do you think you are doing?
If you need roommates because you can't afford an apartment on your own, you are poor by definition. That's probably the most universal definition of poverty that has ever existed. As long as there have been houses, the baseline household has had a housing unit of their own. Households that have to share housing with others have always been characterized as unusually poor, no matter the continent and the millennium.
Thus my point. I don’t know what “livable wage” means with these numbers so it’s not very useful for discussion or planning or measurement.
Historically speaking this is incredibly wrong.
Nearly every culture evolved from some sort of shared communal longhouse to individual clan homes, to extended family homes. The idea of individual private rooms actually comes about explicitly from Manors in the late medieval ages. We really didn't see widespread individual homes until the industrial revolution. In places like the East, individual rooms were an import from the West.
Even in rare places where there were individual family homes (Ancient Egypt, for one). Privacy and individuality were just not concepts. Through the 1800s, you might have literally been sharing a bed with a stranger in a hotel.
There has also never, ever been a point in human history where living without some sort of roommate was common. Even in situations where you had lots of single workers, they almost always lived in bunkhouses or SROs.
This was about households rather than individuals and housing units instead of homes, and privacy is unrelated to the discussion. For example, longhouses typically had internal subdivisions that functioned as housing units. A household that cannot afford a baseline housing unit is unusually poor, regardless of its size.
In a developed country, the baseline housing unit most households can afford is typically an apartment or a house. Households that cannot afford one are unusually poor.
Someone who forms a single-person household and doesn't earn enough to rent an apartment is poor.
Single-person households are often poor, especially when the person is young. Living wage estimates for such households tend to be higher relative to typical wages than for larger households, as the idea of a living wage is largely about rising above poverty.
I don’t make a living wage for my region and while I can afford food and a room to rent, I can’t really live a decent life, save for the future or invest in myself, I just barely get by every paycheque to paycheque. Thanks
More the former. A lot of the commenters here are missing that detail. A living wage doesn't mean you can afford all the nice things, it means you aren't starving and can cover the needs for you and your family, but maybe some, but not many, wants.
They do not actually live on less, they sacrifice their health or well-being in order to meet the constraint.
I would argue the calculator grossly underestimates necessities because most of these jobs are not doable in old age, so you need to account for saving $1 for each $1 you make, to support yourself while old. You also need an emergency fund, because in the US you get billed $1000 for the most random shit at the most random time.
I got billed $5000 randomly for an echodardiogram because insurance didn't pay for it despite them saying they would. At least I have $5K to spare, but considering that can happen, that needs to be considered a basic necessity.
I've always taken "living wage" to be the wage required to live in reasonable comfort. You won't be owning any yachts or eating caviar, but you should also not be living paycheck to paycheck unless you're acting irresponsibly with your money.
If you're sharing a house or apartment with one or more roommates for reasons other than romance or saving up for a place of your own, to my mind, that's not a "living wage" - it's mere survival. Whether we believe minimum wage should barely let you scrape by or live more comfortably shouldn't confuse the fact that in many places, it doesn't even meet what's considered "poverty wage" (e.g., it doesn't in my local area).
Here in Norway we have five weeks of holiday plus various public holidays and only 37.5 hours per week adding up to about 1700 hours per year.
Edit: Also, the US is a damn oil nation. It has nothing to do with oil, and everything to do with politics.
Partly because they're paying for drug innovation and defense for other countries.
That's a lot of blackjack and hookers for the ministers, if you really believe that "the government" takes 57% of GDP for "themselves". No wonder we're at out 6th PM, they must fall like flies with the amount of drugs they have to snort in order to siphon this much money.
You must not know France very well. We're the most independent nation defense wise in Europe. We build our own stuff, have nuclear subs and carriers. You're talking out of your ass.
Edit: And looking into it a little, I'm pretty sure two of those islands actually do have mandatory paid leave after a minimum period of employment.
If you would rather trade your paid vacation for an extra week of pay, I am sure you and your boss can work it out. Companies pay out unused vacation all the time. Just don't ruin it for the rest of us!
1. Further exploit desperate people since those that don't need to work at any cost would steer clear of jobs that have 0 holidays. 2. You would further penalize people with families where both parents work. It is well understood that if your kid is sick you can't really use your sick days and so must use your PTO days. Having 0 available days doesn't play well with having kids (personal experience).
And finally, having mandated PTO allow you to actually take holidays. I heard too many times of companies that offer unlimited PTO and when the employer tries to take some they sabotage him/her or plainly threaten his/her job security.
Another way to think about it: why do we have building codes? We don't want to incentivize builders to cut corners that would risk an electrical fire or falling down in an earthquake or something in order to offer a cheaper price, so we make it illegal. If unsafe buildings are allowed, it makes it difficult for safe builders to stay in the market. Similarly, we don't want to incentivize workers to sell their labor with zero leave in order to offer a cheaper price, because that risks unhealthy and insular communities (literally unhealthy if people can't take sick leave), poor mental health, unhealthy childcare practices, an unhealthy civic environment if people can't take time off to vote or volunteer, etc. The labor market is competitive and people will sacrifice paid leave if they have to, because they need money to live, so we should make it illegal to remove the incentive.
No, you do not want that.
The market value of most people's labour is very close to zero.
Left to the market most of the population would live just below starvation, a very small group of owners would live very well, and a small group of artisans would do OK supporting the tiny group.
That is where many countries are heading
Similarly, there is no US law against most crimes. It doesn't mean those laws don't exist in every State.
That said, there is no State with mandatory paid vacation either AFAIK.
Given the political diversity of the States, this suggests that mandatory paid vacation is either not considered an important issue by people across the political spectrum or there are existing regulations that would create real problems if there paid vacation was mandated without changing those regulations first.
For most countries they say you get leave, but it doesn't count for part time workers, or contractors obviously, or people like farmers who are outside the typical work system. Further in reality enforcement is incredibly spotty, some countries have a history of making laws without any intention of enforcement just for show.
Most every white collar job in the US that I've ever heard of has ~2+ weeks vacation per year, it's necessary to get any employees so there's no need to make a law about it.
Meanwhile certain countries on that list work 6-7 days a week, so the 5-10 mandated days off really aren't what they seem.
It's incredibly obvious that places like the EU handle vacation stuff way better than the US and it's well known around the world for that, but pretending that the US has the worst working conditions is insulting to places where people are putting up with way worse conditions.
Those outcomes depend much more on labor policy, bargaining power, and what governments choose to protect. In many places, business pressure and media framing make long hours seem unavoidable, even though they’re ultimately the result of policy choices.
Where do you think the term "Dutch disease" came from?
Norwegian workers do 1,418 hours per year, one of the lowest in the world
Just going off basic numbers:
- 3744/52/5 = 14.4 hour day if they work 5 days a week
- 3744/52/6 = 12 hrs if they work 6 days a week
- 3744/52/7 = 10.3 hrs if they work 7 days a week.
Office workers will eat lunch, take a 1-2hr nap in the afternoon, and also eat dinner with their coworkers within the common 9-9-6 rhythm. It still takes a significant chunk of time, but the actual working time butt-in-chair is closer to 54 hours
For reference, that's 10:15 per day, 365 days a year. Or 996 without vacations, if you intend to have one day off.
996 has never been a standard work duration for urban workers in China, aside from some tech companies that promoted performative work ethics. And even there, people do take vacations.
20-25% of total Norwegian government spending comes from the fund.
If they had a car they most likely shared it. It was far less safe, didn't have AC, guzzled gas and polluted.
Never ate out and spent a third of earnings on cheap grocery store staples.
College and healthcare was much cheaper, and they got a lot less of it.
We're benefiting greatly from the increase in productivity. We just view our great-grandfather luxuries as our necessities.
But at least they could afford a house, right? I think a lot of people would accept living in a house without AC and more likely to catch fire. Is a house like that cheap today? No, right? It's crazy expensive as well.
>If they had a car they most likely shared it. It was far less safe, didn't have AC, guzzled gas and polluted.
Car technology in the past was worse, we know that. Cars were more affordable though.
>Never ate out and spent a third of earnings on cheap grocery store staples.
Like today then.
>We're benefiting greatly from the increase in productivity. We just view our great-grandfather luxuries as our necessities.
Young people are rotting at home unable to go ahead with their lives because wages nowadays are not enough to pay for a house and a family. Why do people try to deny this obvious reality? Productivity didn't benefit everyone equally and people in the past had more opportunities to build a life inside a standard that was socially acceptable.
>Is a house like that cheap today? No, right? It's crazy expensive as well.
I assume by catch fire GP means electrical wiring? Many houses on market today are literally not remodeled since the 1940s so retain that original wiring.
Eehhhh... I really don't think that's true.
First, adjusted for inflation, new car prices really aren't that different than they were 10-30-50-70 years ago. You have to compare like for like, no cheating comparing a modern luxury car to Ford Pinto. For example the cheapest car in 1970 cost about $2000, with no frills like a radio, passenger wing mirror or floor matts. That's equivalent to about $17000 today. A base Nissan Versa today starts at $18000, yet includes power windows and an A/C.
Second, the maintenance requirements today are much, much lower than in the past. There's a whole list of expensive stuff you just don't have to think about with modern cars until long after those old cars would be at the junk yard (chassis lube, spark plugs, spark plug wires, carb and distributor, wheel bearings etc). That's a lot of labor you don't pay for, to say nothing of the parts!
Third, despite being heavier, more convenient and safer, modern cars have lower fuel consumption. Coming back to our Pinto vs Versa example, the Versa gets at least 50% better fuel economy.
Fourth, cars today just last longer. It used to be a minor miracle when a wasn't rusted out after 10 years or the engine still ran after 100k miles. Today, your car might be still under warranty at that point.
> Why do people try to deny this obvious reality?
Because it is not at all obvious that that is, in fact, reality. It doesn't help to complain about easily-disprovable things like the affordability of cars.
Well you can just search "why are cars so expensive" and then you will find dozens of articles like the one below. I'm not American but I have the impression that cars were a kind of milestone in the life of young people in the past and this disappeared due to affordability. How much does it cost to live in a van nowadays? Can a part time fast food worker afford it?
I don't like this hedonistic argument that you used, it sounds like cheating, you risk sounding like the GP saying that houses today that nobody can afford are in fact cheaper because they are less likely to catch fire.
https://www.msn.com/en-us/autos/buying/why-owning-a-car-is-g...
If you don't believe the enormous amount of freely available data on the internet. I am American, I had grandparents who were American. Poverty was a whole different beast in the 1930's compared to today.
A 2025 Nissan Sentra was pretty similar in constant dollars to my 1982 Datsun Sentra. A 2025 Honda Civic was pretty close to my 1989 Civic. A 2025 Honda CR-V was pretty close to my 2006 CR-V.
The average new car price now is quite a bit higher in constant dollars than the average new car price decades ago, but that is because preferences have shifted to cars that are at more expensive places in the lineup.
My 2006 CR-V for example was more than my 1989 Civic in constant dollars, but CR-Vs are at a higher price point that Civics. If I had gotten another Civic in 2006 it would have been about the same as my 1989 Civic.
I don't know many people who would rather live in a house without climate control than an apartment. A house from 1936 with no improvements is worth very little. When purchasing a house like that you're mostly buying the land.
> Car technology in the past was worse, we know that. Cars were more affordable though.
Car ownership in 1936 was far below what it is today.
> Like today then.
No, groceries were far more expensive. You can buy far more gallons of milks, eggs, lbs of ground beef, or potatoes at today's prices with todays median wage than you could in 1936 on the 1936 median wage. We have records of how much people made, and the cost of basic staples. This isn't something you need to guess about you can just google it.
> Young people are rotting at home unable to go ahead with their lives because wages nowadays are not enough to pay for a house and a family. Why do people try to deny this obvious reality? Productivity didn't benefit everyone equally and people in the past had more opportunities to build a life inside a standard that was socially acceptable.
Because 100 years of data says that this is a difference in expectations vs people being poorer. Yeah housing is more expensive than it should be due to regulation but despite that people are still much better off.
People would raise a family on a single income. Boomers would work brain dead job and afford more than what a white collar worker can today, not to mention you could change careers when you wanted. Land was dirty cheap. People had multiple houses. You could find a job right out of highschool.
Nowadays people work dead end jobs to never be able to afford anything. Social security is being bankrupt by retirees who are collecting much more than they contributed and millennials and zoomers are repeatedly told they are not going to be able to retire. A degree became just a piece of paper. Any job interview has at least 3 stages. Childcare, education, etc ridiculously expensive. Houses and rent are ridiculously expensive.
>I don't know many people who would rather live in a house without climate control than an apartment. A house from 1936 with no improvements is worth very little. When purchasing a house like that you're mostly buying the land.
You're completely out of touch. Even apartments are super expensive nowadays. I would gladly live in a house without A/C.
Why do you have so much certainty about what it's like in the US now vs 70 years ago when you're not American?
Are you saying that the data is wrong and the only way to know what it's truly like to make it in America is to not live there? That's sounds insane.
Plenty in Seattle.
You're ignoring the gorilla in the room. Why can't one live in a comparable manner today and bank the difference? Because those things aren't available? Why aren't those things available?
You can do this. Just move to a sparsely populated area and work remote. Rural and semi-rural areas are basically the "poor", lower productivity areas within any given country, if you can arbitrage the incomes difference via remote work you stand to gain quite a bit.
For two reasons.
1. They're illegal. You're not allowed to build a house to 1936 climate, safety, and fire codes with un-licensed labor. And boarding houses were effectively banned.
2. Market. Most people would rather live in a smaller apartment than 1936 style un-climate controlled death trap.
And the reasons are the same for cars. You legally can't sell a new 1936 car, and even if you could most people would rather drive an 10 year old civic.
"The very reason why we object to state ownership, that it puts a stop to individual initiative and to the healthy development of personal responsibility, is the reason why we object to an unsupervised, unchecked monopolistic control in private hands. We urge control and supervision by the nation as an antidote to the movement for state socialism. Those who advocate total lack of regulation, those who advocate lawlessness in the business world, themselves give the strongest impulse to what I believe would be the deadening movement toward unadulterated state socialism."
--Theodore Roosevelt
Rent is always going to go up there even if they build more. Same in other places. As long as rent setting tools exist to collude - we will see the rent not go down. You're not gonna dump $100m in new buildings and not maximize your return.
There may be fewer people in manhattan, but that's mostly because fewer people live in each living unit. The same number of living units is being demanded by the market because of evolving living preferences.
If you allow sufficient living units to be built, it doesn't matter how much landlord try to collude, they won't be able to keep rent high. Someone will break when the vacancy rate reaches 15%.
You see this pattern across the American economy. The boomers locked in their house values by passing all the zoning regulations to artificially restrict the supply of housing. AMA artificially restricts the supply of doctors to increase their wages. Accreditation pushed ever higher costs on universities which increased costs, and the availability of loans basically cut off the brake cable. And who do you think is really benefitting from all the companies enshittifying everything and pushing up costs? The billionaires and retirees of course. And the young/working people are paying for it.
The solution for individuals is arbitrage. Remote work, get healthcare abroad, and avoid college tuitions. The fact that these things make sense at all shows how broken the markets are.
It shows $13,641 for my metro (Chicago), but day care costs are easily twice that. Obviously once kids are school-age this is much lower (if going to public school), so maybe that's how you get at this figure.
On the other hand the transportation costs are way overestimated for non-car families (we spend less than $2k/year on local transit for 2 adults and 1 child, obviously this doesn't include airfare for vacations or whatnot). Maybe these are both an artifact of too broad a catchment area (childcare is probably cheaper in the 'burbs, but so likely are average transportation costs).
Also, a lot of the data is at least a few years old now. And the new data that is made available has a fat asterisk on it, if it is from the feds.
$11,896 with 2 children? My Kaiser $14K deductible bronze plan costs $2100 a month. That's more like $25K a year, and that's before I use it... the only reason I have it is in case something traumatic happens. This is the cheapest plan I can get on covered california.
Typically, it tends to cover the bottom of the income level, aka the folks who are trying to get a living wage.
Seems like their methodology is a little broken, wouldn't you agree? My out of pocket is a 14K deductible on top of 25K in premiums.
When I looked at the methodology, some is based on consumer surveys so it may be more reflective of over-consumption. In other words, it prices in what people want or what they’re used to, not what they need. The counterpoint is that maybe some wealthy countries should be pricing in a higher quality of life, but the “living wage” then becomes a bit of a misnomer.
If you look at US BLS and Federal Reserve studies on such things, they make a distinctions between what people actually spend on ordinary expenses and when people can no longer afford those categories of expenses.
An interesting artifact is that incomes across the 15-40th percentile range in the same city don't save much money but still have enough money to pay for all ordinary expenses. That is a wide range of incomes for people nominally spending their entire income on the same things. What actually seems to happen is that average people spend excess income on upgrading their lifestyle until they hit the 40th percentile, at which point the average person starts saving some of their additional excess income.
By my estimations, it's not a great calculator. $2.5k/month for all housing costs. I'm not saying it's not possible to find a studio + utilities but that's not a fun place to live. No AC, no insulation, built for a different climate which was 70 years ago, laundromat or (hopefully) coin-op laundry in building, likely near busy roads (101, el camino) or train tracks with no sound insulation, still extremely car dependent (which is included in this calculator - gas/electricity, taxes, and cars in CA are very expensive), etc. Again, doable but competitive market and not a fun one. You'd be guaranteed to NEVER own any property at that income. Until we have some public housing utopia, I'd say ownership should be accounted for in a living wage. Otherwise, you're gonna get evicted when retirement hits.
Its calculation on taxes seems off to me as well. https://smartasset.com/taxes/california-paycheck-calculator#... Says $72308 in San Mateo, CA gives you $55793 - not $59791. You'd have to make close to $80k/yr to get the amount they suggest to live.
This calculator does not include retirement savings, emergency saving, etc. It just assumes you'll comfortably live paycheck to paycheck until you die and never save a dime. In our country, you will not be getting $60k/yr post tax from social security. So, this is a stupid calculator unless you plan to never retire or never experience job loss (max payout is $450/week for unemployment in CA), etc.
It doesn't include those things because those aren't the things that are covered by a "living wage". Living wage sounds like something good, but it's literally just enough to cover what's needed. Can you afford housing, childcare, medical care, transportation for work, etc. It's a low bar, not a good target, for a society to try to hit. It means people at that wage shouldn't be going hungry or without shelter, but they won't necessarily be thriving.
The core of the problem is that you basically have to have someone define what is an acceptable standard of living. Sharing a flat? Nah, the MIT trained economist thinks that's for the poverty people so that is defined as below living wage. Walk to work? No. You need atleast $10k a year on travel otherwise you're a bus wanker.
A huge amount of this is value judgements on what is an acceptable standard of living from people who benefit from immense privilege but will never experience the thing they're studying.
That artificially inflates the “wage level” needed for the estimated living standard. It also makes the tax figures absurd. No two-parent, two-kid household making $110K is paying 15% of that net in taxes, subtracting deductions, credits and subsidies.
IOW, our “safety net” for middle-income parents could get 5X more generous and this calculator would show the same results.
There are massive tax deductions and credits available to the middle class (and beyond!) for health care, child care, education …
Transfer payments aren’t just for the destitute.
Having roommates is extremely common.
There are also a lot of room-for-rent situations that don’t show up on the websites listing apartments. If you’re tapped into local networks of younger people there’s always someone with a room for rent or a group of friends looking for someone to take over a room in a house they’re renting together. Not helpful for someone in their 50s moving to a new city, but for young people living on a budget this is just how it works and has for a long time.
If you live in a large city, then it works great.
Whatever you think about Mr Price or his math, I still believe this is the most intuitive description of a "living wage" as a concept.
> The cost of civic engagement specifically is constructed by summing together the Consumer Expenditure Survey’s annual expenditure means for audio-visual equipment; education; fees and admission; other entertainment; pets; reading; and toys, hobbies, and playground equipment by both the size and composition of the consumer unit, which functions as a rough proxy for family size.
To me that's a pretty interesting category. Also it's pretty large at least for the Chicago metro area.
For example, you don’t want me to be the one to define “living wage.” I’ve been a prepper/bushcrafter for 20 years… the ACTUAL “living wage” is _zero_. There are innumerable resources all around you if you know how to find and use them.
https://www.bts.gov/data-spotlight/household-cost-transporta...
For example, the average new-vehicle price in December 2025 was about $50,000. But people earning the living wage mostly aren't buying that kind of car. They could buy a new car for less than half that, or buy a used car. Or they may choose to take public transit.
From the page itself, first paragraph. Double the value under 2 adult (both working) to get the estimated household income.
The thing I want to see next would be the sister calculator: what it would take for a business of X size employees, Y revenue, Z other expenses, to increase wages to these standards.
This feels like it would help to close that gap. Give a business owner a concrete path to take. Just saying something is broken isn't going to get it fixed.
Just typing all this I think I have my weekend project lined up.
Thanks MIT!
How is 1 adult + 3 children at $107.95 and 2 adults + 3 children at $63.97
5 people could require more money than 4. You could say in the 2nd case it's $63.97x2 but that doesn't make any sense either because the table also has 1 adult 0 children $29.31 and 2 adults 0 children at $41.81. Clearly they are not doing 2x to that $41.81 as it would be more than the $29.31 at 2x
Was this AI generated?
See the first row in this table: https://livingwage.mit.edu/counties/06075
Compare 2 adults (1 working) 3 kids to 2 adults (both working) 3 kids
First off, you'd expect it to be
1 adult = X
2 adults = X + X(0.?)
Similarly for kids
1 kids = Y
2 kids = Y + Y(0.?)
3 kids = Y + Y(0.?) + Y(0.?)
But instead, under 2 adults 1 working we see
1 adult = $29.31 (from one adult)
2 adults = $41.83 (so X + X * 0.42)
2 adults 1 kid = 50.47
2 adults 2 kids = 54.77 (so + $4.30)
2 adults 3 kids = 63.97 (so + $9.19)
Then you can also compare 1 adult 3 kids with 2 adults both working + 3 kids
1 adult + 3 kids = $107.95
2 adults (both working + 3 kids) = $55.67
1 adult + 3 kids = $107.95
2 adults (both working + 3 kids) = $55.67x2 ($111.34)
Again, these are nonsense numbers.
2. Did you look in the costs breakdown? You'll probs find your answers there.
3. I am guessing having a spare adult to take care of 3 children instead of paying for childcare is probably the difference.
And the non-working adult is taking care of children, so reducing childcare expenses.
First row, for https://livingwage.mit.edu/counties/06075
| 1 adult | 2 adults (1 working) |
| 0 Children | 1 Child | 2 Children | 3 Children | 0 Children |1 Child | 2 Children | 3 Children |
| $29.31 | $61.37 | $83.72 | $107.95 | $41.83 | $50.47 | $54.77 | $63.97 |
1 adult + 0 children = $29.31
2 adults + 0 children = $41.83
1 adult + 3 kids = $107.95
2 adults + 3 kids = $63.97
Also, two adults (assuming married) will pay lower taxes than one adult for the same income. That's another ~30k difference per year in the breakdown table for the 3 children case. If your tax burden is lower, you can afford a lower wage while bringing in the same net.
EDIT: Tax rates in the US are roughly half (except for high income earners, way beyond these living wage estimates would be relating to) when you're married versus single.
https://www.irs.gov/filing/federal-income-tax-rates-and-brac...
Check out the 22% bracket on that page, the range is doubled for married people filing joint versus single. That's a huge savings each year. Tax savings of two married people and any number of kids is a major contributor to why the living wage drops when someone gets married versus is single with the same number of kids.
That feels pretty close to accurate.
According to Wikipedia[1] median household income in the US and Norway is only about a quarter of your 160 kUSD.
I'm pretty sure that most of the people living near me in Norway are not high earners but I don't see any signs of starvation either.
That highly depends on your definition of "need" and where you live. If you're in a city with ludicrous cost of living, like San Fransisco, then sure. But, that's also why people commute, or just choose to go somewhere cheaper. It's somewhat shocking seeing how much higher the standard of living is, with much less income, outside the big cities.