Calif. Minimum Wage Doesn’t Pay the Bills: Report
Workers earning minimum wage can’t afford rent in many SoCal cities
By Heather Navarro and Angie Crouch
| Tuesday, Mar 12, 2013 | Updated 7:46 PM PDT
A worker earning minimum wage in California has to clock in more than three the standard 40-hour work week to renting a two-bedroom residents, according to a new report. The divide between wages and rent across America is growing, and California ranks fifth worst in the country. Angie Crouch reports from Beverlywood for the NBC4 News at 5 p.m. on March 12, 2013.
California’s gap between minimum wage and housing affordability is the fifth worst in the country, behind New York, New Jersey, Maryland and Washington, D.C.
Earning the state’s $8-per-hour minimum wage, Californians would need to clock in 129 hours per week — three times the standard 40-hour work week — to afford housing for $1,300 a month, according to National Low Income Housing Coalition’s annual report, which uses census and median income data.
Residents in Orange and Ventura counties would need to earn at least $30 per hour — or work about 155 hours per week on minimum wage — to afford two-bedroom housing, according to the report.
The Golden State ranked as the second most expensive place to rent in the United States, behind Hawaii.
Rent Almost Out of Reach for Minimum…
In 1968 an hour’s pay at minimum wage ( $1.60) would buy almost 5 gallons of gasoline (@ $0.33/ gal.) but today in Eureka an hour’s minimum wage ($8.00) will buy a little less than 2 gallons of gasoline (@ $4.37 per gallon.)
If the minimum wage had been increased at the same rate as the price of gas, the minimum wage would be over $21.00 per hour today.
Santa Fe Living Wage: A Case Study
“The Santa Fe metropolitan area provides an ongoing real-time experiment in the impact of a fairly high minimum wage on the economy. Santa Fe currently has the strongest economy in New Mexico. Since April of this year, Santa Fe employers have been required to pay a minimum wage of $10.29 an hour.
The Santa Fe Living Wage ordinance initially set the Santa Fe wage at $8.50 an hour in 2004. It was raised to $9.50 in 2006 and, because it is indexed, has increased at regular intervals since that time. The unemployment rate in Santa Fe County—at just 4.7 percent—is the lowest of New Mexico’s four metropolitan areas. Job growth in Santa Fe is now at 2.1 percent, which may not seem impressive until one considers that the other three metropolitan areas are still losing jobs. Most of the job growth was in the leisure and hospitality sector—the sector most affected by the living wage floor.
The record in Santa Fe demonstrates that it is possible to have a fairly high cost of living and a fairly high minimum wage along with low unemployment and strong job growth.”
A family of four in California would need an average of more than $63,000 a year – nearly triple the federal poverty level – to cover its basic needs, according to an analysis of the state’s cost of living to be released today.
The 2011 Self-Sufficiency Standard, released by the Insight Center for Community Economic Development, a national research organization, shows that in every county in California, the federal poverty level falls short of meeting basic needs: housing, food, child care, health care, transportation and other essential household expenses.
Taking all these costs into consideration, the standard calculates the minimum annual income required for 156 family compositions in each county. The pre-tax income needed to make ends meet for a family of two working, married adults; a preschooler; and a primary school-aged child ranged from $53,775 in Tulare County to $86,629 in Marin County. For a family of four, the 2011 federal poverty level, which is based on the cost of food alone and does not take into account regional cost-of-living differences in the contiguous United States, is $22,350.
more @ California Watch http://californiawatch.org/dailyreport/federal-poverty-level-doesnt-meet-basic-needs-data-shows-12903