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$15 Minimum Wage Isn't Enough for Workers to Afford Rent in Any U.S. State

Teen Vogue logo Teen Vogue 7/16/2021 Jacqui Germain
a sign on the side of a building © Justin Sullivan

This story is published as part of Teen Vogue’s 2021 Economic Security Project fellowship.

In Florida, someone working full-time would need to make $24.82 an hour to afford a two-bedroom rental. In Colorado, you’d need to make $27.50 an hour. In Washington state you’d need to make $29.31 working full-time. The wage thresholds for a two-bedroom rental in New York and Washington, D.C., are even higher: $34.03 and 33.94, respectively.

The National Low Income Housing Coalition (NLIHC), which just released its 2021 Out of Reach report looking at housing affordability in the U.S., puts California at the top of the unaffordable list, alongside five other states that also have a wage threshold calculated to be above $30 for a two-bedroom rental. According to the report, to afford this type of apartment, California-based workers would need to work full-time at $39.03 an hour — more than double the $15 federal living wage activists have spent years fighting to implement.

The Fight for $15 movement, which popularized increasing the current federal minimum wage from $7.25 to $15, has been a steady engine for nearly a decade. While politicians have advocated for incremental increases at the state and local level — even Senator Joe Manchin has finally come around to $11 an hour — the movement has been unmistakably consistent: Today’s workers need a living wage and a living wage is $15 an hour. Despite President Biden’s vocal support for a $15 federal living wage during the campaign season, his administration has yet to make much headway on this, beyond raising wages for federal contractors.

Even 10 years ago, the year before the Fight for $15 movement officially launched, someone with a full-time job would have needed to make a minimum of $18.46 an hour to afford a two-bedroom rental, according to the NLIHC’s 2011 Out of Reach report. We know that at our current federal minimum wage of $7.25, a full-time worker couldn’t afford a two-bedroom anywhere in the country; and if the 2021 Out of Reach report is any indication, a $15 federal living wage isn’t enough to cover this cost either.

Obviously, housing costs vary from state to state, but the NLIHC’s most recent national data determined that the national housing wage (how much a full-time employee needs to make per hour to afford a particular home) to rent a two-bedroom in the U.S. is $24.90. For a full-time worker in search of a one-bedroom rental, the national housing wage drops to $20.40.

It’s also worth noting here that the NLIHC’s calculations around affordability align with what the federal government and most personal finance and budget experts recommend. The general rule of thumb is that an individual’s housing costs should not exceed 30% of their income. In fact, the U.S. Department of Housing and Urban Development defines someone as “cost-burdened” or “rent-burdened” if they spend more than 30% of their income on housing alone. Since 2001, the share of all renter households that qualify as being “cost-burdened” has hovered between 40-50%, according to a study by the Joint Center for Housing Studies of Harvard University.

In 2019, Representative Rashida Tlaib (D-MI) proposed pushing the living wage fight further, arguing for a federal minimum wage above the $15 that some progressive lawmakers have supported. “It should be $20 an hour — $18 to $20 an hour at this point,” said Tlaib, according to The Hill. 

People generally seem hesitant to put an actual number on a new proposed minimum wage, but Tlaib is not the only one who's making the case that $15 isn’t enough for many wage workers to live on. The COVID-19 recession also threw into sharp focus just how many individuals and families are living in economically precarious conditions. Even before the pandemic, 85% of extremely low-income renters couldn’t afford their rent and 70% spent more than half of their income on housing, according to the NLIHC report. 

Even though experts say the U.S. economy will likely bounce back from the pandemic recession and job growth will increase more quickly than we have experienced in other periods of economic crisis, if those jobs don’t pay a living wage, they still might not be enough for people to make ends meet.

Want more from Teen Vogue? Check this out: When a First Job at McDonald’s Turns Into a Nightmare

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