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Working people are so screwed: Rents spike and minimum wage hits its lowest value since 1956

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Laura Clawson

The average wage needed for someone to afford a market-rate one-bedroom apartment rental in this country is $21.25 per hour. The federal minimum wage is $7.25 per hour. It’s not hard to see the problem here.

Both sides of the equation are responsible: The rent is too damn high and the pay is too damn low.

According to the National Low Income Housing Coalition‚Äôs annual report on housing costs, the market rate for a modest two-bedroom home requires an hourly wage of $25.82 for affordability, defined as 30% of income on housing costs. Across the entire country, ‚ÄúIn approximately 9% of counties or county equivalents (including Puerto Rico), the renter wage is below the federal, state, or local minimum wage.‚ÄĚ In the continental U.S., Arkansas is the winner, requiring just 1.4 full-time minimum wage jobs to afford a two-bedroom apartment.

On the rent-is-too-damn-high front, ‚ÄúAcross the country, rents rose 18% between the first quarter of 2021 and the first quarter of 2022. These rent increases have been widespread: out of 345 metropolitan counties, all but two have seen a rise in rental prices since 2021.‚ÄĚ Those increases have hammered people who were barely making it month to month, already paying well over the 30% of income considered affordable for housing. Some interviewed in the NLIHC report are now paying 80% of their household income to remain housed.

Nationally, more than 40% of people are not paid enough to afford a one-bedroom apartment, and nearly 60% are not paid enough to afford a two-bedroom apartment.

The burden of high housing costs falls disproportionately on Black and Latino renters, the report notes: ‚ÄúWhite workers at the bottom of the white income distribution earn over one dollar more per hour than Black and Latino workers at the bottom of their respective income distributions. Among Black workers, a Black person at the 20th percentile of wages earns $2.30 less per hour than a white worker at the same percentile. A Latino worker at the 20th percentile of wages earns $2.05 less than a white worker at the same percentile.‚ÄĚ 

On the pay-is-too-damn-low front, the minimum wage, which has not increased since 2009, is now worth less than at any time since 1956. The Economic Policy Institute’s Dave Kamper put that in context:

The United States must invest in affordable housing and rental assistance. It must increase the minimum wage‚ÄĒeven in the states where it‚Äôs currently the highest. And that means Republicans cannot be allowed to keep standing in the way.¬†

This blog is printed with permission.

About the Author: Author’s name is Laura Clawson. Laura is assistant managing editor for Daily Kos.


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Millions of U.S Workers for Walmart, McDonald’s and Other Corporate Giants Rely on Food Stamps and Medicaid

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Mil¬≠lions of full-time, adult work¬≠ers in the Unit¬≠ed States?‚ÄĒ?many of them employed by Wal¬≠mart, McDonald‚Äôs and oth¬≠er high¬≠ly prof¬≠itable cor¬≠po¬≠ra¬≠tions?‚ÄĒ?are paid wages so low they‚Äôre forced to rely on pub¬≠lic assis¬≠tance to make ends¬†meet.¬†

That is the key find¬≠ing of a new¬≠ly released report by the non¬≠par¬≠ti¬≠san Gov¬≠ern¬≠ment Account¬≠abil¬≠i¬≠ty Office (GAO). Com¬≠mis¬≠sioned by Sen. Bernie Sanders (I?Vt.), the report ana¬≠lyzed data from 15 agen¬≠cies admin¬≠is¬≠ter¬≠ing Med¬≠ic¬≠aid and the Sup¬≠ple¬≠men¬≠tal Nutri¬≠tion Assis¬≠tance Pro¬≠gram (SNAP, or ?‚Äúfood stamps‚ÄĚ) across 11 dif¬≠fer¬≠ent states. 

For all 15 agen¬≠cies, Wal¬≠mart was in the top four employ¬≠ers of Med¬≠ic¬≠aid enrollees and SNAP ben¬≠e¬≠fi¬≠cia¬≠ries, while McDonald‚Äôs was in the top five for 13 of the 15 agencies.

Oth¬≠er major retail¬≠ers and fast-food com¬≠pa¬≠nies were found to be among the most com¬≠mon employ¬≠ers of work¬≠ers receiv¬≠ing Med¬≠ic¬≠aid and SNAP, includ¬≠ing Dol¬≠lar Tree, Dol¬≠lar Gen¬≠er¬≠al, Tar¬≠get, Ama¬≠zon, Burg¬≠er King, Wendy‚Äôs, Taco Bell, Home Depot, Lowe‚Äôs, Wal¬≠greens and CVS. Rideshare ser¬≠vice Uber?‚ÄĒ?which recent¬≠ly spent mil¬≠lions of dol¬≠lars suc¬≠cess¬≠ful¬≠ly defeat¬≠ing a Cal¬≠i¬≠for¬≠nia law that would have made its dri¬≠vers eli¬≠gi¬≠ble for basic work¬≠er pro¬≠tec¬≠tions and ben¬≠e¬≠fits?‚ÄĒ?was also ranked among the top 15 employ¬≠ers of work¬≠ers on pub¬≠lic assistance.

‚ÄúAt a time when huge cor¬≠po¬≠ra¬≠tions like Wal¬≠mart and McDonald‚Äôs are mak¬≠ing bil¬≠lions in prof¬≠its and giv¬≠ing their CEOs tens of mil¬≠lions of dol¬≠lars a year, they‚Äôre rely¬≠ing on cor¬≠po¬≠rate wel¬≠fare from the fed¬≠er¬≠al gov¬≠ern¬≠ment by pay¬≠ing their work¬≠ers star¬≠va¬≠tion wages,‚ÄĚ Sanders said of the report. ?‚ÄúThat is moral¬≠ly obscene.‚ÄĚ

The new GAO report echoes the con¬≠clu¬≠sions of sim¬≠i¬≠lar stud¬≠ies by the Uni¬≠ver¬≠si¬≠ty of Cal¬≠i¬≠for¬≠nia, Berke¬≠ley Labor Cen¬≠ter in 2013 and 2015, which found that U.S. tax¬≠pay¬≠ers are sub¬≠si¬≠diz¬≠ing large cor¬≠po¬≠ra¬≠tions to the tune of $153 bil¬≠lion per year in the form of pub¬≠lic assis¬≠tance pro¬≠grams to sup¬≠port their low-wage employees.

‚ÄúIt is time for the own¬≠ers of Wal¬≠mart, McDonald‚Äôs and oth¬≠er large cor¬≠po¬≠ra¬≠tions to get off of wel¬≠fare and pay their work¬≠ers a liv¬≠ing wage,‚ÄĚ Sanders added.

The fed¬≠er¬≠al min¬≠i¬≠mum wage has been stuck at $7.25 an hour since 2009. While a major¬≠i¬≠ty of states have raised their respec¬≠tive min¬≠i¬≠mum wages above the fed¬≠er¬≠al floor in the past decade, 21 states have not. Thanks to union-dri¬≠ven cam¬≠paigns like the Fight for $15 and Unit¬≠ed for Respect (for¬≠mer¬≠ly OUR Wal¬≠mart), eight states and mul¬≠ti¬≠ple cities have enact¬≠ed grad¬≠ual increas¬≠es to a $15-per-hour min¬≠i¬≠mum wage in recent years. And on Novem¬≠ber 3, vot¬≠ers in Flori¬≠da over¬≠whelm¬≠ing¬≠ly approved a mea¬≠sure to raise their state‚Äôs hourly min¬≠i¬≠mum wage to $15 by 2026.

Last July, the Demo¬≠c¬≠ra¬≠t¬≠ic-led House of Rep¬≠re¬≠sen¬≠ta¬≠tives passed a bill to increase the fed¬≠er¬≠al min¬≠i¬≠mum wage to $15 an hour, but the leg¬≠is¬≠la¬≠tion went nowhere in the Repub¬≠li¬≠can-con¬≠trolled Sen¬≠ate. Pres¬≠i¬≠dent-elect Joe Biden sup¬≠ports a fed¬≠er¬≠al increase to $15, but whether or not such a bill can get to his desk in the near future like¬≠ly depends on the out¬≠come of Georgia‚Äôs Jan¬≠u¬≠ary 5 runoff elec¬≠tions, which will decide which par¬≠ty gains con¬≠trol of the U.S. Senate.

In Geor¬≠gia?‚ÄĒ?where vot¬≠ers will soon deter¬≠mine the short-term fate of the $15 fed¬≠er¬≠al min¬≠i¬≠mum wage?‚ÄĒ?the offi¬≠cial state min¬≠i¬≠mum wage is a mere $5.15 an hour, with employ¬≠ers only required to pay $7.25 because of the fed¬≠er¬≠al leg¬≠is¬≠la¬≠tion passed over a decade ago. Accord¬≠ing to the new GAO report, over 143,000 work¬≠ing adults in Geor¬≠gia depend on SNAP ben¬≠e¬≠fits and over 208,000 rely on Medicaid. 

Besides rais¬≠ing the nation¬≠al min¬≠i¬≠mum wage, the GAO‚Äôs find¬≠ings also indi¬≠cate the need for fed¬≠er¬≠al leg¬≠is¬≠la¬≠tion allow¬≠ing ser¬≠vice sec¬≠tor work¬≠ers the right to union¬≠ize with¬≠out employ¬≠er inter¬≠fer¬≠ence. After all, the ral¬≠ly¬≠ing cry of fast-food and retail work¬≠ers in recent years has been ‚Äú$15 and a union.‚ÄĚ Because they are orga¬≠nized and can bar¬≠gain with their employ¬≠ers, union work¬≠ers on aver¬≠age earn high¬≠er wages and have greater ben¬≠e¬≠fits than their nonunion counterparts. 

In Feb¬≠ru¬≠ary, the House of Rep¬≠re¬≠sen¬≠ta¬≠tives passed the Pro¬≠tect¬≠ing the Right to Orga¬≠nize (PRO) Act, which would allow work¬≠ers to win union recog¬≠ni¬≠tion through ?‚Äúcard check‚ÄĚ and remove var¬≠i¬≠ous cor¬≠po¬≠rate-friend¬≠ly legal bar¬≠ri¬≠ers to union¬≠iza¬≠tion. But as with the $15 min¬≠i¬≠mum wage bill passed last year, the PRO Act died in the GOP-dom¬≠i¬≠nat¬≠ed Senate.

Impor¬≠tant¬≠ly, the data used in the new GAO report was gath¬≠ered in Feb¬≠ru¬≠ary, before the coro¬≠n¬≠avirus pan¬≠dem¬≠ic began. Since then, with tens of mil¬≠lions of jobs lost, the already mea¬≠ger social safe¬≠ty net has been stretched to the break¬≠ing point. The tem¬≠po¬≠rary and lim¬≠it¬≠ed eco¬≠nom¬≠ic relief pro¬≠vid¬≠ed by the fed¬≠er¬≠al CARES Act in late March has long since dried up, with no new relief pack¬≠age in sight. 

Mean¬≠while, food inse¬≠cu¬≠ri¬≠ty has more than dou¬≠bled from 8.5 per¬≠cent of all U.S. house¬≠holds before the pan¬≠dem¬≠ic to 23 per¬≠cent, and at least 8 mil¬≠lion more Amer¬≠i¬≠cans have fall¬≠en into pover¬≠ty since May. More than 12 mil¬≠lion U.S. work¬≠ers and their fam¬≠i¬≠ly mem¬≠bers have lost their employ¬≠er-spon¬≠sored health insur¬≠ance in the midst of the pan¬≠dem¬≠ic, rein¬≠forc¬≠ing wide¬≠spread calls to enact a sin¬≠gle-pay¬≠er, Medicare for All health¬≠care system.

‚ÄúNo one in this coun¬≠try should live in pover¬≠ty. No one should go hun¬≠gry. No one should be unable to get the med¬≠ical care they need,‚ÄĚ Sanders said.¬†?‚ÄúIt is long past time to increase the fed¬≠er¬≠al min¬≠i¬≠mum wage from a¬†star¬≠va¬≠tion wage of $7.25¬†an hour to $15, and guar¬≠an¬≠tee health care to all Amer¬≠i¬≠cans as a¬†human right.‚ÄĚ

This blog originally appeared at In These Times on November 20, 2020. Reprinted with permission.

About the Author: Jeff Schuhrke has been a Work¬≠ing In These Times con¬≠trib¬≠u¬≠tor since 2013. He has a Ph.D. in His¬≠to¬≠ry from the Uni¬≠ver¬≠si¬≠ty of Illi¬≠nois at Chica¬≠go and a Master‚Äôs in Labor Stud¬≠ies from UMass Amherst. Fol¬≠low him on Twit¬≠ter: @JeffSchuhrke.


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