Earlier this July, the National Low Income Housing Coalition (NLIHC) released their annual Out of Reach 2021: The High Cost of Housing report. Every year, this national report provides researchers and advocates with important data demonstrating the widening gap between where minimum wage income earners live and the type of rental housing they can afford. With the federal minimum wage remaining stagnant for over a decade at $7.25 per hour, the economic fallout from the COVID-19 pandemic has only exacerbated the financial stress of low-income workers, with a quarter of renters earning $50,000 per year or below having to borrow from friends and family to meet the cost of essential expenses.
Today, the average full-time worker would need to earn $24.90 per hour to afford the rent of a modest two-bedroom apartment, and $20.40 for a one-bedroom apartment. While most states, the District of Columbia, and several municipalities have raised their hourly minimum wage above the federal minimum wage, the average minimum wage earner still must work 97 hours per week to afford to rent a two-bedroom home. There is no state or locality in the U.S. where a full-time minimum wage worker can afford to rent a modest two-bedroom home without being cost-burdened, and in only 7% of all U.S. counties can that same individual afford a one-bedroom apartment.
Below are the states with the largest shortfalls between average renter wage and a two-bedroom housing wage:
- Hawaii (-$20.13)
- California (-$14.15)
- Massachusetts (-$13.68)
- New Jersey (-$12.57)
- Maryland (-$10.17)
You can find the full report here, and the NLIHC Out of Reach interactive page with state data and graphics here.