Rent remains high for residents in Washington, where minimum-wage workers need to work two full-time jobs to afford a two-bedroom apartment
Minimum-wage workers across Washington cannot afford market-rate housing without working more than one job, according to a report the National Low Income Housing Coalition (NLIHC) published in May.
NLIHC releases an annual report titled “Out of Reach,” that examines whether local minimum wages of U.S. workers are adequate to pay rents all around the country.
By looking at national numbers and at each state separately, the report provides detailed information about the housing situation and the sufficiency of minimum wages in the United States.
In the report, housing is considered affordable if a household has to spend no more than 30 percent of its gross income on rent and utilities. According to the 2016 report, U.S. residents on average need to earn $20.30 per hour for a two-bedroom and $16.35 for a one-bedroom rental unit. A worker earning a federal minimum wage of $7.25 is far from this amount.
Even in places with minimum wages above the federal level, it is not possible for a full-time worker to afford a two-bedroom working a single full-time job. Workers in just 12 counties and one metropolitan area across the country earn enough to afford a one-bedroom rental unit.
Additionally, the report includes statistics on rents and reveals that average pensioners in the U.S. are also struggling to pay for decent homes.
According to the report, wage stagnation and income inequality contribute to the widening gap between minimum wages and housing expenses. While hourly wages for the richest 5 percent of the population have grown more than 8 percent between 2007 and 2015, the bottom 10 percent have seen an increase of just 0.2 percent. A study by the Brooking Institute discovered that cities with greater income inequality between the poor and the rich have higher housing prices at the same time. Housing markets focus more on high-income households than on households at the lower end, according NLIHA.
In Washington state, a full-time worker needs to earn $23.13 to afford a two-bedroom rental unit. Washington has the 10th most expensive housing in the country, according to the report.
In the greater Seattle area, housing is even more expensive.
King and Snohomish counties have the most expensive housing in the state. Workers in those counties need to make $29.29 an hour to afford a two-bedroom apartment.
It would take 3.1 full-time positions at minimum wage to afford a two-bedroom apartment in King and Snohomish counties.
Executive Director of Washington Low Income Housing Alliance (WLIHA) Rachael Myers was surprised by “how far out of reach housing in Seattle is even with our relatively high minimum wage.”
Mayor Ed Murray and the Seattle City Council passed a higher minimum wage for Seattle in 2014, which will hit $15 an hour in 2017 for employees of large companies. Currently the minimum wage is $10.50 to $13, depending on the size of the company and whether the job involves tips or includes health insurance as a benefit.
WLIHA spokesperson Reiny Cohen said the report shows “that this is a statewide crisis, not just a Seattle problem.”
WLIHA will integrate the information from this report into its public policy priorities for the 2017 Washington legislative session.
WLIHA is going to “fight for budget allocations for the Housing Trust Fund, shine the light on the National Housing Trust Fund and work to give cities the option to consider rent stabilization policies,” Cohen said. She added that they also hope to preserve and increase the Consolidated Homeless Grant, which supports local communities to address the homelessness that results from these rent increases.
While a lot of people in Seattle are struggling to pay the rent, “everyone sees homelessness growing,” Myers said.
People concentrate on the individual reasons for homelessness, such as mental illness or drug addiction, but Myers said housing is the real cause.
“The overwhelming driver of the increasing homelessness we see today is rising housing costs,” she said.