Talk of the Town: Making the Rent

hours at minimum wage needed to afford rentOver the last couple of days, this image has made its way across the Internet via Facebook, Tumblr, Digg, and other sites. It’s a simple map showing how many hours per week a minimum wage-worker in every state, plus Washington, D.C. and Puerto Rico, would need to work in order to afford the rent and utilities on a modest two-bedroom apartment in their state.

This map comes from Out of Reach 2012: America’s Forgotten Housing Crisis. We release Out of Reach every year to document the disparity between what workers can afford to pay for the rent, and what is available to working renters in the private market.

It comes as no surprise to most people that a worker making minimum wage would have a difficult time being able to afford the rent. After all, minimum wage is, by definition, the lowest wage people in just about every profession can make. What makes this graphic shocking, however, is just how far out of reach the rent is in so many place. In Hawaii,  a minimum wage worker must work 175 hours a week, 52 weeks a year to afford the rent. In Utah, it’s 77 hours per week, 52 weeks per year. Even in the most affordable place on the map, Puerto Rico, a worker cannot afford rent and utilities on a modest apartment working less than 55 hours per week, 52 weeks a year.

It is tempting to brush away these figures by saying that minimum wage isn’t meant to be a living wage, or that not everyone should try to rent a two-bedroom apartment. But as we note in our report, recent analysis shows that 78% of minimum wage workers work at least 20 hours per week, and 80% are at least 20 years old. So when we’re talking about minimum wage workers, we’re not talking about high school kids in after-school jobs. And with the economy in the shape it’s in, we know that many of these minimum wage workers are people who would work better, higher-paying jobs if they could, but those jobs are just not available to them.

It’s also important to know that according to the Bureau of Labor Statistics, the average wage earner in the U.S. works 34.5 hours per week as of January 2012. Again, this isn’t always by choice; many of those workers who have not been laid off have seen their hours cut back.

When it comes to apartment size, we use the two-bedroom apartment as our standard because it’s the most common apartment size and the most reliable rent to measure (we’re a research organization; we like our data to be accurate!). We also use the two-bedroom apartment because it reflects reality for many working families across the country. There are parents with children in our communities who are struggling to get by. They are living in those two-bedroom apartment, making those low wages, and doing their best under bad circumstances to provide a better life for their children.

In the end, it comes down to what HUD Secretary Shaun Donovan wrote in the preface of our report: “For decades, having a decent, safe place to call home has been a cornerstone of opportunity in America- a place where we can raise our families, connect to our communities, and pursue better opportunities for ourselves and our children.” What our minimum wage map shows is that having a decent, safe place to call home is no longer a given for working people in America. We believe that isn’t the way it should be, and that there are concrete steps that can be taken to make affordable housing possible for all Americans again.

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12 Comments

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12 responses to “Talk of the Town: Making the Rent

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  10. Peter

    Why is two bedrooms the standard here? And you do realize that increasing minimum wages increases costs, which increases prices, thus feeding inflation and decreasing the value of the dollar, making the higher wage worth the same as the lower wage?

    • NLIHC

      Peter, thank you for your comment. We use two-bedroom apartment as the standard for this calculation because the most reliable data available is on two-bedroom apartments. Second, this report is really about what it would take for a working family today to afford a decent standard of living. With many more families renting than buying a home, and many people experiencing unemployment or underemployment, being able to afford a modest two-bedroom rental is a very real question for a lot of Americans right now. Finally, we’ve done similar calculations for other apartment sizes, which you can see on the report page at http://nlihc.org/oor/2012.

      The Coalition supports Rep. Jesse Jackson, Jr.’s bill to increase the minimum wage to $10 and index it to inflation (H.R. 5901, the Catching Up to 1968 Act) because the shortage of housing affordable to extremely low income people is both a housing problem and an income problem. Providing minimum wage workers with a slightly higher income will make it somewhat more possible for them to find housing they can afford. To you point about inflation, as it happens the minimum wage is worth less now than it was in 1968. This small increase in the minimum wage simply aligns it with current economic realities.

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