Report: Minimum wage earners must work 87 hours a week to afford housing in Alabama

Alabama News
Jose Bravo, Alberto Esther Castaneda

(AP Photo/David J. Phillip, File)

BIRMINGHAM, Ala. (WIAT) — Minimum wage won’t cover the cost of rent anywhere in the country, according to a new report, Alabama included.

The 2021 Out of Reach report, compiled by the National Low Income Housing Coalition, has found the average minimum-wage employee in the United States would need to work 97 hours per week to cover an “affordable” two-bedroom home at Fair Market Rent, as defined by the U.S. Department of Housing and Urban Development.

For the purposes of the study, reasonably “affordable” was defined as “no more than 30 percent of a household’s gross income should be spent on rent and utilities.”

On average in Alabama, one would need to make $15.80 per hour at minimum wage to afford a two-bedroom apartment, and even in areas with a notably low-cost of living one would need to make at least $12.58 an hour, almost double the current minimum wage of $7.25. Overall, at the current minimum wage, an Alabamian would need to work 2.2 jobs to afford a two-bedroom apartment or work an equivalent of 87 hours.

Before you point out that one could downsize to a one bedroom apartment, the report notes that many minimum wage workers are single parents or part of a minority population who, the report finds, are more likely to be affected by housing unaffordability, with the median Black worker and Latino worker earning 24 percent and 26 percent less than white workers across all income groups.

“Even under the best of circumstances, rent is unaffordable for most low-wage workers,” the report states. “When they lose a job, face unexpected expenses like an emergency medical bill or experience a disaster, their families struggle even more. Stable, affordable housing is a prerequisite for basic well-being, and no family should live in danger of losing their home.”

The discrepancy between minimum-wage income and affordable rent only grows in some of the country’s most expensive markets, such as California and Hawaii, where workers would need to earn way more than minimum wage — $39.03 and $37.69 per hour, respectively — to be able to afford a two-bedroom rental while working a standard 40-hour week.

The NLIHC has also included more specific data for each zip code as part of its Out of Reach report, available via an interactive tool at the NLIHC website.

A map compiled by the National Low Income Housing Coalition shows the hourly wage needed to afford a modest two-bedroom rental while working a standard 40-hour work week. (NLIHC)

The National Low Income Housing Coalition is a non-profit organization dedicated to advocating for policies that promote affordable homes for lower-income Americans. You can read their full report on affordable housing in 2020-2021 here.

Nexstar Media Wire contributed to this article.

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