Thursday, December 2, 2010

What does a living wage look like in America?

Moving towards a living wage

What would a living wage in American look like? The Alternatives Federal Credit Union put together this analysis on what it costs to live an affordable lifestyle in the United States. On average, to live sustainable life requires roughly $23,000 a year for an individual. Divided by 40 hours, that amount becomes about $11/hour.

Comparatively, the poverty line for an individual in the United States is roughly $10,000 a year. Under that, and you are eligible for a variety of benefits to supplement your income. The disparity between the two comparisons should provoke some interesting thoughts.

What exactly happens to those who live between the gap of $10k and $23k per year?


Category Month (2006) Month (2008) Percent Change Year (2008) Comments Source
Rent $628 $763 21.50% $9,156 Fair market rent, single BR incl. utilities HUD
Food $180.95 $203.25 12.32% $2,439 Average of low-cost food plan for males/females 19-50 USDA
Transportation $164.22 $167.52 2.01% $2,010.24 Weighted average of amount spent on cars and public transportation ACS, BLS, EIA, TCAT
Communication $56.48 $61.49 8.87% $737.88 Local calling plan, 30 minutes long-distance and Internet BLS, Verizon
Health Care $122.62 $143.53 17.05% $1,722.36 Employee's share of premium and out-of-pocket medical expenses BLS, Alternatives
Recreation $100 $100 0.00% $1,200.00 Arbitrary Claritas
Savings $56 $59.81 6.80% $717.72 Adjusted for inflation BLS
Miscellaneous $105.08 $111.13 5.76% $1,333.56 housekeeping supplies Claritas
Net (Subtotal) $1,413.35 $1,609.73 13.89% $19,316.76

Payroll Tax $130.42 $147.29 12.93% $1,767.45

Federal Tax $118.58 $117.95 -0.53% $1,415.39

State Tax $41.83 $50.35 20.36% $604.15

TOTAL $1,704.18 $1,925.31 12.98% $23,103.75

hourly@40 hrs/week $9.83 $11.11*



* The Tompkins County Workers Center/Living Wage Coalition figures that the hourly living wage without health insurance is $12.11 an hour.

See the full report at: http://www.alternatives.org/livingwage2009notes.html.

Compare this to the current guidelines for the Federal Poverty Line:

Persons In Family Or Household 48 Contiguous States and D.C. Alaska Hawaii
1 $10,210 $12,770 $11,750
2 13,690 17,120 15,750
3 17,170 21,470 19,750
4 20,650 25,820 23,750
5 24,130 30,170 27,750
6 27,610 34,520 31,750
7 31,090 38,870 35,750
8 34,570 43,220 39,750
For each additional person, add 3,480 4,350 4,000

SOURCE: Federal Register, Vol. 72, No. 15, January 24, 2007, pp. 3147-3148


1 comment:

Leni, Alternatives COO said...

The study done by Alternatives Federal Credit Union figures the living wage for Tompkins County, not America. Living wage is different depending on the community you live in. So, for instance, rent in Ithaca is much higher than it is in surrounding counties, but less than NYC.