How many people should a minimum wage full time job be able to support?

[Recursion]

I keep coming back to this question because I don't know a good answer to it. We were Fighting For $15 a couple of years ago and now that's being called "starvation wages".

When you think about a minimum wage, how many people do you want it to be able to support? What happens to families larger than that?

[guillaumeb]

1. Imagine that it was called a living wage job.

As one example, Jeff Bezos is incredibly rich, but his warehouse workers often qualify for various types of assistance.

The same applies to the Walton heirs.

[FBaggins]

3. I don't think that gets to the heart of Recursion's question

It would just change the question to "living for how many?"

If a single minimum-wage job were enough to house/cloth/feed/etc. a family of four... some kids would ask why they should even go to college or develop higher-level job skills.

[guillaumeb]

5. If any business plan relies on paying their workers

a sub-living wage, that plan deserves to fail.

Jeff Bezos could easily pay his warehouse workers much more than he pays. So could the Walton heirs.

And having such a low floor on wages exerts downward pressure on wages for the entire country.

[Recursion]

8. He pays them all at least $15. So if that's not enough, what should the minimum wage be?

That's what I'm asking. If $15/hour is not high enough, since you can't raise a family on it, what would be a workable minimum wage?

[guillaumeb]

11. A good question.

Some would argue that wages should be regionally adjusted to reflect local conditions. But these same people never argue that rich people living in these low cost of living areas should make less.

In many areas of the country, a minimum wage worker cannot afford an apartment, much less afford everything else.

One answer is unions. Unions provide workers with the power to bargain.

[Recursion]

23. A minimum wage worker can afford a studio almost anywhere

Outside of the really pathological cases like SFO and Manhattan. That study people keep posting showed that a minimum wage worker can't afford a 2BR in basically all of the country.

[yellowdogintexas]

38. Actually, there is an incredible shortage of affordable housing across the nation

A two earner family earning minimum wage can not afford a 1 bedroom apartment or 2 bed if they have children.

Fort Worth has a very small number of affordable units. I know 2 women who share an apartment for financial reasons, and they are constantly looking for something less expensive. They are on SocSecurity and whatever other employee benefits they may have.

Nationally the median 1 bedroom rent is $960 and 2 bedroom is$1191. The rent in the most expensive cities spikes the averages, but if you factor in employment opportunities and wage averages, even the lowest cost states will have a shortage of affordable housing.

This data does not include house rentals, which may often be split among 3 or 4 people.

[Recursion]

44. Would increasing wages make that better?

It's not like that changes the housing stock

[MoonchildCA]

50. I live in Ventura County, CA.

Minimum wage is $12.00. The lowest price studio is about $1200, hard to find though. The average price is about $1500--yes, for a studio, and they go up much higher than that.

Net, after payroll taxes is about $1775. I guess if you eat ramen noodles and peanut butter, and don't own a car, you could make it work...

I just looked at studios in Asheville where my daughter lives. Even they go for about $800 - $1200. Minimum wage there is $7.20. That comes out to about 1072 after payroll taxes. That would be pretty difficult to get by on the remainder.

Neither of these are the cheapest places, but they are pretty average for a decent "blue" place to live.

[Recursion]

51. Craigslist shows a lot of $600-$800 stuff (nt)

[MoonchildCA]

53. I used Craigslist for my reference.

I see a few "rent to own" places saying that's their price, (which I'm sure is based on at least a 20% down payment). Also, a few cheap places in "Maggie Valley" in the middle of nowhere, but that's about it.

[Doremus]

55. The studios above our shop rent for $500/mo. in an inner ring suburb.

Lower middle class, older neighborhood. I imagine, other than apartments in the city itself, we are the baseline for what would be considered a low rent district in the midwest, with rents only going up farther out.

Monthly full time gross income on minimum wage is around $1100. Rent would take about half of after-tax income. That leaves $500 for utilities, food, insurance, car payment, clothes and other necessities (these are not luxuries). Doable? Maybe, but it's not a life I'd want to live.

The studios are usually at 100% tenancy. There aren't enough to meet demand. Are you okay knowing that most people on minimum wage couldn't locate an available studio if they wanted one?

[FBaggins]

10. You're dodging the question

The starting salary at Walmart is plenty for a kid just out of high school sharing an apartment with two other guys taking night classes... I doubt that it's enough to support a spouse and two kids.

[guillaumeb]

12. Most Walmart positions are not full time positions.

So I would argue that your position is flawed.

And I might ask, exactly how rich do the Walton heirs have to be?

[FBaggins]

19. My understanding is that they are about 50/50...

... but why would that matter? Are you arguing that a part time position should earn enough to support a family?

[guillaumeb]

24. No, I am arguing that there is no need to staff a business

that is open long hours with part time employees. These part time schedules are used by the Waltons to minimize the number of workers who qualify for benefits.

And after talking to workers at 3 local Walmarts, I was told that all of the floor positions are part time.

[Recursion]

9. It's also not clear what happens to the housing market then

If everybody can rent a 2BR, suddenly nobody can rent a 2BR.

[0rganism]

37. markets don't work like that

think about it: if you're a landlord with a bunch of 2BRs to rent out, and you have a choice of renting to "everybody" or "nobody", and renting to "everybody" will cover your costs, are you going to price your rentals so no one can afford them? really?

[FBaggins]

43. Sure they do

If everyone with a minimum-wage job can suddenly afford a 2BR apartment, that doesn't change the number of 2BR apartments... it just increases the demand for such units - and thus the price. It also drives up the price of nicer housing since a couple who each have minimum wage jobs are no longer stuck living in an apartment.

[0rganism]

48. yes the price goes up but not beyond what people can afford

the landlord won't get rich or even cover costs by renting to "nobody".

[FBaggins]

52. What other way does a supply/demand imbalance resolve?

People who want but can't currently afford a 2BR apartment can suddenly afford one. There is now more demand for everything from 2BR on up... but no change in supply.

What happens next?

"Nobody" wasn't an option. All that has changed is that high school dropouts can now afford a 2BR apartment when they used to live at home or rented a room in someone's basement.

[0rganism]

56. "nobody" was exactly the condition posited by Recursion in this subthread

as in "suddenly nobody can rent a 2BR"

but to your point, we want to avoid the scenario where a given area has a "living wage" and rental housing jumps up to just over what that wage allows, causing the living wage to rise again and a corresponding rise in housing rates, leading to a positive feedback spiral which would indeed result in Recursion's condition .

i think we can agree, the particulars are going to vary from market to market. some might see no significant effects at all (due to relatively few people working at the "living wage" ), others might need rent control ordinances on subsets of housing to make it work.

it would definitely be in the interests of landlords to coordinate with local government (hardly a stretch, as there's already significant similar activities to this effect everywhere i've ever lived) to find optimal minimum rates.

[Recursion]

61. Rent control brings it's own problems, but OK

Now we need a national rent control regime.

I want to be clear I'm specifically not saying "inflation" in general would eat up increased wages: I'm saying in places without sufficient housing stock (that is, most places with jobs) increased wages don't make that problem go away. We have housing stock that essentially guarantees housing eats up a lot of middle class take-home pay, no matter what that pay is.

[Recursion]

45. I take it you're not from NYC

Because that's exactly what happens.

Housing is unlike basically any other market because we aren't making new land.

[0rganism]

49. some people can afford those rates, or they wouldn't be rented at those rates

which is not "nobody can afford a 2BR"
if they weren't capable of renting at those rates, the landlord would re-price them accordingly or lose money on each and every unoccupied unit
also
> we aren't making new land
we're not talking about land per se, but rather housing. new housing happens frequently, often housing that makes more efficient use of existing land.

[0rganism]

34. imho young people *should* ask that question

> some kids would ask why they should even go to college or develop higher-level job skills

indeed. what if we took fear of poverty out of the college equation?

maybe people who attend college would do so for interest in subject matter, furthering understanding of the world we live in, discovering and developing their underlying talents. maybe college shouldn't be only, or even primarily, about "job skills".

[Recursion]

6. His warehouse workers make at least $15/hour

A couple of years ago we were cheering that as a livable wage, but it's not really, for a family of four.

[Cartoonist]

2. Just one

It's called a minimum wage, not a prosperity wage.

[maxsolomon]

4. 31K/year at 40 hours/wk.

Let's get to $15/hour before we start worrying about the slippery slope to a living wage.

"Minimum wage means 'If we could pay you less, we would'." - Chris Rock

[Recursion]

7. Well, for instance, Amazon is there already

Amazon pays all of its workers at least $15/hour. But that's not enough for a worker with multiple kids. And we get very angry when workers at Amazon get social assistance for their kids like SNAP or CHIP.

[guillaumeb]

14. Exactly.

And not all warehouse positions are full time.

And worker testimony says the conditions at these Amazon warehouses are terrible.

[Recursion]

46. Should it only be legal to have a 40-hour-a-week schedule?

I'm trying to imagine a fix for that and I'm coming up blank.

[maxsolomon]

15. I don't.

Those who do likely get mad about everything.

[Voltaire2]

32. because the reality is that 15/hr is insufficient for a family.

and it is crap that companies like Amazon, that paid zero in federal taxes is having their workers subsidized by federal tax revenue.

15 is a starting point. It is the *MINIMUM*. The fact that Amazon pays its workers the proposed MINIMUM wage is not a bragging point, it is why Amazon sucks.

[Joe941]

13. The wages should be based on family size.

[MichMan]

16. So people with children are much less likely to get hired ?

[Joe941]

20. Basically the employer would play x for each employee to the government....

Then the government would pay the employee based on family size. The employee would not know or care about family size.

[FBaggins]

25. So... straight up Maxism?

From each according to his ability, to each according to his needs?

No thanks.

[Joe941]

26. You tell that to those who cant feed their kids. I barely keep food on the table.

[FBaggins]

27. I would have no problem telling that to them

Making sure that everyone else has a problem feeding their family too is NOT a solution to the problem.

[Joe941]

29. No one would be going hungry. This is why we need bernie.

[FBaggins]

30. Wrong. LOTS of people would be going hungry

It's just that we would all be equally hungry.

[MichMan]

28. By providing incentives to have even more kids?

[Voltaire2]

33. good point. If the critters starve they are less likely to procreate.

Was that what you meant?

[Cuthbert Allgood]

58. I don't think you understand communism vs socialism.

[FBaggins]

59. Did you read the context?

Having the government tax a fixed amount per job and then pay the worker based on family size is definitely not "socialism"... but Marx would love it.

[Codeine]

31. Transparent. nt

[mathematic]

17. So that's a no on "equal pay for equal work"? n/t

[Joe941]

22. The employee would pay equal for equal work. See above post for my plan.

[cagefreesoylentgreen]

42. Why should childless or childfree people be penalized?

Why should people who don’t want or can’t have children be penalized and earn less?

[PoindexterOglethorpe]

18. How many people a given wage can support depends on a lot of factors.

Most of which are never really thought about.

Number one is the cost of housing in a given location. The reason there's such a housing crisis in this country is that in too many places not enough apartments or starter homes have been built in recent years or even decades. My city of Santa Fe is one such. There have been any number of articles in the local paper about this, and there's probably a shortage of around 5,000 units, depending on how you want to calculate it.

Another sort of hidden cost is kids in school. Even if they qualify for free lunches (and breakfast is some places) there's still buying clothes, school supplies, often even books. Then special extra fees if they want to play a sport or be in a band. Stuff like that.

It's my opinion that schools ought to be structured and financed so that all students and teachers could eat lunch in the cafeteria no charge. And that books be free to the students. Perhaps at the beginning of each school year the students could be issued the same basket of supplies (paper, pencils, pens, etc) they are now expected to go out and buy. Yes, I know this would take a whole lot more money, but the truly pathetic thing is that too many people are completely indifferent to the needs of students and schools.

Anyway, that is an excellent question, but if you look back at minimum wage, you learn that it was most valuable in 1968, when $1.60 was the equivalent of $11.50 or so today. But I don't think as many jobs were minimum wage back then. Nor did as many people stay at minimum wage as long as is often the case today. And, it's now been a decade since the last increase. I strongly suspect that the people most opposed to rises in the minimum have NEVER gone a decade without a raise.

[Hoyt]

21. Two people making $15/hour, working full-time would be in middle class -- roughly $60K annually.

That's not going to leave a lot for extras, but it is livable, especially with healthcare be it MFA or subsidized ACA or Public Option. It's also provides a base from which to get further training to move beyond $15/hour. Working overtime is often an option too.

Clearly 2 or 3 people -- where only one is working at minimum wage -- will have difficultly. Most folks should try to avoid getting in that situation, but a safety-net should be available.

While I'm not for leaving larger families without help, most people should be more careful before having a bunch of kids. I think most are nowadays.

There should be some form of payment for family members who take care of ill family members as an alternative to home care paid by Medicare, Medicaid or other government program.

Yes, there are some high cost areas where $60K is not nearly enough. Probably ought to consider moving in that case.

Housing is a problem. I'd like to see it easier to build so-called tiny houses. 600 - 800 square feet is livable, but there are so many restrictions for separate houses in populated areas.

[underpants]

39. I agree with your post but everyone overlooks daycare

I know I know don’t have a kid if you can’t afford it. Not everyone has grandma down the street (we don’t) and that really isn’t fair to grandma.

We make pretty good money (my wife makes about twice what I do) but not having daycare has had a big impact on us. We couldn’t afford the house we just bought if we were still paying for daycare. Thank god for cell phones.

I had a supervisor once who had 3 kids in two years (strange story) one with special needs. She was making $75k. She said that they had to consider her not working because daycare was just sucking all their money away.

You are right about caregivers. People don’t realize how many people are out of the workforce making nothing taking care of family. I don’t know WHAT can be done but we do need to have a discussion about it.

[pnwmom]

54. It doesn't allow them to have children, because daycare is expensive. And Elizabeth Warren

points out that in her parents' era, her mother was able to support the family on a single minimum wage job.

[handmade34]

35. a little guidance for families of 4...

https://www.cnbc.com/2019/05/16/how-much-money-a-family-of-4-needs-to-get-by-in-every-us-state.html

https://livingwage.mit.edu/pages/about

https://livingwage.mit.edu/resources/Living-Wage-User-Guide-and-Technical-Notes-2018.pdf

of course this is all average and situations vary

example...

Vermont
Total required income before taxes: $68,657
Estimated housing costs: $13,744
Estimated food costs: $10,245

so here $15 is basically only good for 1-2 people

[Ohiogal]

36. I would be curious

if there are any statistics out there that show how many minimum wage workers work a full 40 hour week. Seems to me that most businesses hire them part time, so they don't have to pay them any benefits.

[StatGirl]

40. One.

Ideally (in my opinion), if a person works 40 hours a week at minimum wage, he or she should be able to afford food, housing, and medical care, all at a decent level, without government assistance.

However, because automation is eliminating the need for many jobs, I'd prefer for the country to move to a universal basic income, given to all adult citizens, to cover the same basic needs.

If a person wants more than the basics, they need to work. However, jobs will be easier to come by, because many people will be happy to take the basic amount and enjoy their leisure time (or only work part time).

(The issue of how to cover children is a whole other issue. I would not like the system to be game-able to reward having more children, and yet children also need food, housing, medical care, education, etc. So some middle ground would need to be established.)

[haele]

41. Minimum wage be based on local CoL and should include benefits.when full time.

It should be enough that when one is working the minimum number of full time hours, it should support one person in some sort of stable housing with enough left over for minimum level of utilities, food, and health care.

Minimum wage requirements sould also be split into full time and part time - with part time wages at a higher rate than full time, as part time won't get benefits a full time worker gets. Say, $2.00 more an hour for part time workers.
After all, if the companies "can't survive" without using government subsidies to maintain the workforce that generates their profits, they need to impose some personal responsibility on themselves as well as their workforce.

Also, one never knows why someone can only work part time (Heath, school, daycare?), or even if they're "teenagers just starting out" or "too lazy" to work full time - who are we to judge if someone "deserves" a wage that can put a roof over one's head and at least one meal a day in one's belly?
Are we a third world country or supposedly a wealthy, civilized country? If we can't take care of our citizenry, then we might as well go back to the days when it was not unexpected to stumble across the occasional body of someone dead from starvation, disease, or hypothermia in an alley or sidewalk, or find family members dead in remote or rural "homesteads" when making a welfare check on a struggling relative who hadn't been in contact for a few weeks.

It's supposed to be 2020, not 1920. If we as a society can't find much of a value in an investment in our citizens, we aren't much better than a loosely affiliated caste-driven pack of tribal savages.

If that's what this country wants, then the rule of law pretty much means whatever the richest bastard around wants it to be. Why have a country or Constitution anymore?

Haele

[Baked Potato]

47. Barely one, and that's in a low cost of living state

[intrepidity]

57. Here, I'll toss this granade

I'd go so far to say that the religions that teach anti-birth control or are anti-abortion, become 100% financially responsible for society's children.

[Captain Stern]

60. 2

I think anybody that puts in a 40 hours of work every week should be getting paid enough to support themselves, and one other person.

[hunter]

62. Four, with a 36 hour work week.

They'd all have to be willing to live together in a small super-efficient urban apartment, eat mostly vegan food, and go without a car.

This would be in a society with universal health care, paid for by steeply progressive taxation.

Hey, you asked.

[Recursion]

63. It's a good answer, it's just something that needs to be said out loud

And this brings up the point in Elizabeth Warren's first book, though: if we want that, it means most couples will have to go to being one-earner families.