Minimum Wage: Beggaring Workers does not Help Employment (Infographics)

[unhappycamper]

www.juancole.com/2013/02/beggaring-employment-infographics.html


Minimum Wage: Beggaring Workers does not Help Employment (Infographics)
Posted on 02/19/2013 by Juan

There is no place in the United States where a minimum wage worker working 40 hours a week can afford rent on a two-bedroom apartment.



Where the state’s minimum wage is lower than that of the Federal government, or where there is no minimum wage, workers get the Federal minimum wage. The vast majority of states which thereby guarantee the lowest wages allowed by Federal law are in the South– South Carolina, Georgia, Alabama, Mississippi, Louisiana and Arkansas. If a low minimum wage created more employment, then these states should be solid green in the second map, at the bottom, showing unemployment rates. But only Louisiana is, and it has petroleum. (High minimum wage doesn’t always track with high employment, but there lots of reasons for unemployment nowadays, especially the Great Real Estate swindle of 2008 and its aftermath. Economists have repeatedly found that increases in minimum wage often track with subsequent rises in employment).

Minimum wage laws by state.



Unemployment by state (Dec. 2012):

[Indydem]

1. Once again - the graphic is right. Your context is wrong.

This is hours per MONTH, not per week.

This has come up a number of times, and simply defies logic. Think about it.

[tridim]

2. Why does it matter if it's per week or per month?

Hours worked are hours worked.

[Indydem]

6. Because the argument is deeply flawed

"There is no place in the United States where a minimum wage worker working 40 hours a week can afford rent on a two-bedroom apartment. "

That's absolutely not true. The graphic is hours worked in a month, meaning divide whatever number by 4.3 to determine the number of hours per week. They are all less than 40. Of course, many of them are still too high to afford and eat, but the argument is still wrong.

[tridim]

16. I guess I see your point, but that caption isn't for the graphic.

Are you saying that you could afford $700 rent with a minimum wage job? Nobody can. That's the point.

I'd say it's flawed because it leaves out utilities, security deposits and pet fees/rent. Then there are also things like food, clothes and transportation.

[Warpy]

17. If that worker is in one of the big coastal cities

that two bedroom apartment will cost him enough that every other thing will suffer: food, clothing, transportation, medical care. It won't be much of an apartment, either, since only slumlords will take a chance on a minimum wage worker. If he's got kids to feed, then he's really in big trouble unless he and the kids take one room and a roommate takes the other, with possibly a third camped out in the living room. And they're all still going to be living on a lot of Top Ramen.

[mopinko]

4. why? most people pay rent by the month.

you will need to elaborate, cuz i am missing your point.

[Indydem]

7. Because the argument attached to the graphic assumes weeks.

"There is no place in the United States where a minimum wage worker working 40 hours a week can afford rent on a two-bedroom apartment. "

They took a graphic and study based on hours worked in a month and tried to make an argument for hours per week. It's wrong.

[mopinko]

10. you never heard of multiplying by 4?

approximately?

[Indydem]

11. 4.3 roughly.

And the point still remains. Minimum wage is $1247 monthly. If it costs that much to rent a 1 bedroom where you live, then you need to get a better job, get a SO, or move.

[mopinko]

13. the operative word being 'afford'

it doesn't say 'pay for' it says 'afford', which is to say that most people would be expected to, you know, eat, and like that.

[sarchasm]

5. sad but true ...

.. and the legend on the right says, "hours needed to afford one br apartment"

.. not that that makes a whole lot of difference, but still.

[Capt13]

8. The context is right...

This is how many labor hours per week a household must invest to AFFORD to rent, not just meet the monthly rental payment
I live in RI for example.


Here is a recent excerpt from a NLIHC report.


" A minimum wage worker would have to work 96 hours per week, 52 weeks per year, in order to afford a two bedroom apartment in Rhode Island, according to a new report on the rising cost of housing across the country.

The Out of Reach 2012 report found that the Ocean State had the 17th highest rental costs in the country. Four other New England states, Massachusetts, Connecticut, Vermont and New Hampshire, also remain in the top fifteen for unaffordable rents. Hawaii had the highest rental costs in the country, Puerto Rico the lowest.

The reports calculates the amount of money a household must earn to afford an apartment at a Fair Market Rent (FMR), which is generally considered to be no more than 30 percent of income for housing costs.


The report, which was released by the by the National Low Income Housing Coalition (NLIHC), a Washington, DC-based housing advocacy group, also found that Rhode Islanders ace the eight largest gap between the cost of housing and the ability to pay for housing in the country. The gap is the difference between the Housing Wage, the hourly wage one needs to make to afford a two-bedroom apartment at the Fair Market Rent (FMR), and the average wage for a renter.
Local Findings

The local findings include:

• In Rhode Island, the Fair Market Rent (FMR) for a two-bedroom apartment is $924. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $3,081 monthly or $36,974 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $17.78.

• In Rhode Island, a minimum wage worker earns an hourly wage of $7.40. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 96 hours per week, 52 weeks per year. Or, a household must include 2.4 minimum wage earners working 40 hours per week year-round in order to make the two bedroom FMR affordable.

• In Rhode Island, the estimated mean (average) wage for a renter is $11.64. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 61 hours per week, 52 weeks per year. Or, working 40 hours per week year round, a household must include 1.5 workers earning the mean renter wage in order to make the two bedroom FMR affordable."

[Indydem]

9. Oh horseshit.

When I was starting out making minimum wage, there was no way in hell I was only going to spend 30% of my income on rent.

In a perfect world full of sunshine and unicorns, yeah maybe. When I was 22 and living on my own with no roommate, it was 70% of my income. I lived lean and ate poorly, but I made it. I could have reduced that percentage by having a roommate or a SO.

30% is a fucking fairy tale. I've got a 2 income household NOW and our mortgage is 28% of our income.

[intheflow]

12. When were you "starting out"?

Rents were much lower when I was starting out, back in the early '80s. Unless I wanted to raise my son in the most drug-infested, crime-ridden area of the city, I could expect to pay about 25% of my income on rent. Mortgages allow for cheaper housing because you're locked into a 30-year deal. However, if you can't qualify for a mortgage, you're SOL on that cheaper housing rate. I pay about 35-40% of my income on rent now (sold my house to go to college, cannot work in that field any longer so now make crap money) and have a r/t commute of 60 miles per day to work to afford this. You must be living a privileged life in a cheap part of the country.

[Indydem]

14. 2003-2007 Is when I was renting

And like I said, I paid 70% of my income on rent. I ate canned beans, rice, canned chilli, and hamburger. No meals out, and no expensive entertainment. I did not have cable TV or a fancy phone. But I made it. As my income went up, so did my lifestyle. I make about $12.50 now and I am married.

But I knew I was starting out. It was what I had to do to get my own place and be independent.

Cheap part of the country, yes. Privileged, not so much.

[intheflow]

15. Ah, I misunderstood you!

I thought you were saying 30% was high. So sorry. I totally need more coffee.

[SheilaT]

3. I currently live in Santa Fe, NM.

We have the highest or second highest (I think recently some other city topped us by a small amount) minimum wage in the country. We also have the lowest unemployment rate in the state.

Unfortunately, it's what I can only call an urban myth that Santa Fe is terribly expensive to live in. I hear this all the time, always from the people who have lived here their entire lives and have no clue. Yeah, rents are higher than in Albuquerque, but they are nothing like San Francisco or DC or NYC or many, many other places. In fact, they are exactly comparable to rents in Overland Park, KS, where I moved here from and which is considered to be a low cost of living part of the country.

I'm old enough that when I first went to work the minimum wage was $1.25, although my very first job was (legally) a sub-minimum wage job. Back then, many more jobs and job categories were exempt from the minimum than are now. I could support myself on that pay. Just, but I could pay rent, which included utilities, had no phone, and bought groceries. I don't think that even then you could possibly consider raising a family on one person's minimum wage. It did take approximately half my monthly earnings to pay my rent, which means one paycheck was rent, the other was everything else.