A report from the National Low Income Housing Coalition (NLIHC) shows that full-time workers making minimum wage cannot afford a one-bedroom rental home without spending more than 30 percent of their income. Out of Reach compares minimum wages annually across states, metropolitan areas, and counties.
Every state’s minimum wage is more than double what is needed for a “modest” two-bedroom rental in 2022. A modest two-bedroom rental home costs $25.82 per hour without spending more than 30 percent of a person’s income on housing – $ 21.25 for a modest one-bedroom rental.
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With a 40-hour workweek, no local minimum wage can afford a one-bedroom apartment at fair market rent. In Arkansas, the minimum wage is $11, but the hourly requirement for a two-bedroom rental is $14.89, the report shows.
Renters in Hawaii must earn the most. On Oct. 1, the minimum wage will increase to $12, so it will cost $40.63 to rent a two-bedroom. The report notes that a two-bedroom apartment or rental home would require 96 hours of work each week for 52 weeks to afford, even with higher minimum wage areas.
That’s about two-and-a-half full-time jobs, according to the report. It’s similar to previous reports from the group showing sobering income-rent disparities. In most states, even sharing a federal minimum wage-earning partner’s income is not enough to cover a two-bedroom rental.
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According to the report, political decisions and the Coronavirus pandemic have compounded the problem. In a previous press release, NLIHC President and CEO Diane Yentel stated, Housing is a basic human need. Our country lacks the political will to fund the scale of the solution needed to solve the affordable housing shortage, especially during COVID-19. Congress must act.
Inflation hasn’t kept the minimum wage up. Today’s federal minimum wage is nearly $6 higher than 1968’s $13.16. Productivity growth hasn’t kept up, either. In 2021, it would have been over $22 per hour.