As the debate about whether or not to raise the federal minimum wage to $15/hour drags on, costs of living in many American cities continue to skyrocket.
Beginning in January 2019, San Jose, California’s $15/hour minimum wage kicked in, following a move by the San Jose City Council in 2016 to raise the wage to $15/hour by this year. However good the city council’s intentions may have been, the city is still far too expensive for anyone making the minimum wage to live in. MIT’s living wage calculator estimates that a living wage in San Jose (a wage capable of paying for all essential needs for a person living a modest lifestyle) for a single adult with no children is $18.54/hour.
In San Francisco, California, voters also approved a minimum wage increase in 2014 to raise the city’s minimum wage to $15/hour by July of 2018, and then index that wage to the consumer price index each year. In July 2019, for example, San Francisco’s new minimum wage will be $15.59/hour. MIT’s living wage calculator shows a single adult with no children in San Francisco should be making at least $18.73/hour.
Seattle, Washington became the first major city to implement a $15/hour minimum wage after intense organizing by labor, and with the help of socialist city council member Kshama Sawant. While the wage increase has been undoubtedly beneficial to workers and the local economy, the wage has still failed to meet basic costs of living in the Pacific Northwestern city. MIT’s living wage calculator estimates a single adult with no children should be making at least $15.05/hour.
The average rent for a modest 860 square-foot apartment in San Jose is $2,370/month, according to figures from rental site RentCafe. The average rent for a 792 square-foot apartment in San Francisco is $3,609/month. And the average rent for a 731 square-foot apartment in Seattle is $1,965/month. Many apartments require a tenant have a monthly income that is three times the monthly rent. This means anyone making the city’s minimum wage in cities paying workers $15/hour would likely have to commute from long distances. Last year, Grit Post reported that teachers in San Jose schools have to commute roughly two hours each way because they can’t afford housing costs in the city in which they teach.
While a $15/hour minimum wage is still an improvement for workers compared to the federal minimum wage of $7.25/hour, it’s still far below what it would be had wages kept up with productivity. In 2017, the Economic Policy Institute estimated that the minimum wage today would be approximately $19.33/hour, more than double the current federal minimum wage.
Tom Cahill is a contributor for Grit Post who covers political and economic news. He lives in Bend, Oregon. Send him an email at tom DOT v DOT cahill AT gmail DOT com.