Minimum wage won’t pay rent

Housing is out of reach for most who earn the federal minimum of $5.15.
Tuesday, December 21, 2004 | 12:00 a.m. CST; updated 5:07 a.m. CDT, Tuesday, July 22, 2008

WASHINGTON — In only four of the nation’s 3,066 counties can someone working full-time and earning federal minimum wage afford to pay rent and utilities on a one-bedroom apartment, an advocacy group on low-income housing reported Monday.

A two-bedroom rental is even more of a burden — the typical worker must earn at least $15.37 an hour to pay rent and utilities, the National Low Income Housing Coalition said in its annual “Out of Reach” report. That’s nearly three times the federal minimum wage of $5.15 an hour.

“You get pushed into a situation where some necessities don’t get paid for” because more salary must be devoted to housing, said Sheila Crowley, the coalition’s executive director. “For people on low-wage fixed incomes, that’s a chronic way of life.”

About 36 million homes in the United States are rented. Roughly 80 percent of renter homes are in nearly 1,000 counties in which a family must work more than 80 hours a week — or more than two full-time jobs — at minimum wage to afford the typical two-bedroom apartment, the coalition said.

The coalition’s “housing wage” assumes that a family spends no more than 30 percent of its gross income on rent and utilities, since anything more is generally considered unaffordable by the government.

The report quoted federal Bureau of Labor Statistics data that showed hourly wages rising about 2.6 percent over the past year, slower than the 2.9 percent rise in rents recorded in the Consumer Price Index.

To close the gap, the government must pour money into programs that help poor people pay rent, and must preserve and build more affordable housing units, Crowley said.

Data from the Census Bureau and the Department of Housing and Urban Development were analyzed to derive housing wage figures. The report also factored in areas in which state minimum wages are, or may soon be, higher than the federal standard.

A one-bedroom apartment was considered affordable for minimum-wage workers in Crawford, Lawrence and Wayne counties in Illinois, where the housing wage was under $6.29 an hour. The state minimum wage for most employees is $5.50 an hour, but will rise to $6.50 an hour on Jan. 1.

Washington County, Fla., was the fourth county listed as affordable for minimum-wage earners renting a one-bedroom apartment. Its housing wage was listed at $6.06 an hour. Florida voters in November approved raising the state minimum by $1 to $6.15 an hour, though the vote results are being contested.

Least affordable was the San Francisco metropolitan area; rent and utilities for a one-bedroom apartment in Marin, San Francisco or San Mateo counties in California required a wage of at least $22.63 an hour, tops in the nation.

No state’s housing wage was lower than the federal hourly minimum wage of $5.15.

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