A rather dismal statistic has been making the rounds of the internet recently: There is not a single American state in which a minimum wage job will provide sufficient earnings to pay the rent on an average two-person apartment. The findings are summarized in the image below:
Courtesy of the We Party Patriots
In 2011, there were 73.9 million people in the United States making minimum wage. Some of them, admittedly,were teenagers supported by their parents, but just under half of American minimum wage workers are over the age of 25. There are undoubtedly cheaper housing options than the two-bedroom apartments cited in the figure above and that might work for some, but remember that this figure only considers rent. After working enough hours to pay for an apartment, a minimum wage earner must somehow find the money for utilities, food, clothing transportation, health care, and other costly necessities. If you consider the situation of a minimum wage earner with dependants or living in a particularly expensive city then the choice becomes very stark: Either live in inadequate conditions, or work obscenely long hours.
The American situation is clearly a disaster to be avoided, so I was curious as to how this would turn out in the Canadian context. I found minimum wage information on Wikipedia and average rent data from the Canada Housing and Mortgage Commission, and compiled the results in the map below:
Thankfully, we do much better than the Americans. It is possible to afford a 2-person apartment with a 40 hour minimum wage work-week in all Canadian provinces. This does not mean, however, that there is no room for improvement. Alberta and BC leave their minimum wage workers less than 15 hours per week after housing to pay for all their other expenses. The situation is worse in major cities, with Torontonians, Calgarians and Vancouverites all requiring more than 27 hours per week to afford an apartment. While we fare better than the United States, there is still ample room for minimum wage workers to face a dilemma between working enormous amounts of overtime or facing material deprivation
Many conservatives will likely quibble with this assessment and suggest that minimum wage workers have a third option: simply get a higher paying job. This argument has been a central point of the Conservative response to the Occupy movement. Here’s an example from I am the 53:
The message behind these anecdotes is generally something along the lines of, “If I can do it, why can’t you?”, and it is based on a romantic misunderstanding of how job markets work. While it is true that there are many inspiring rags-to-riches stories similar to this one, it is also true that they are the exception rather than the rule. That is why we have a word for people like the guy in the picture above: exceptional.
We can’t all start from humble beginnings and become successful, self-made business leaders. No matter how determined and hard-working we become, there will always be some people sweeping floors for the simple reason that floors will always need sweeping. Some people will be unable to push themselves to higher incomes due to extenuating circumstances such as health problems or language difficulties. Others will have tried, failed, and found themselves back where they started with the bonus of a bad credit rating. Still others actually enjoy sweeping floors and have no interest in other jobs. Nobody should be punished with a low standard of living simply because their skills or circumstances have placed them into a low-paying career.
There is nothing wrong with the fact that our society depends manual labour. Those who, for whatever reason, earn their living by the sweat of their brow deserve a great deal of respect for the important services they provide. But that respect must go beyond mere words. Working people should be able to comfortably afford a decent living space, a healthy diet, convenient transportation, education, and the occasional indulgence. They should, furthermore, be able to provide all these things to their children and should be able to do so without working unreasonable hours. We should pay close attention to how many hours a minimum wage workers must work for their basic necessities, and be prepared to respond with government action if that number gets too high.
D
November 18, 2012
So say rent for a 1 bedroom apartment is $1100/month + electricity, and minimum wage is $10.25/hr, 160 hrs/month, so that is $1640 gross pay, so rent is paid, so now what is left is about $400, ICBC (car insurance) is around $100-$200 depending on vehicle & it’s age & driver and then gas cost of about $200/month as gas is currently $1.31/liter up here; so that leaves $0 for food, clothing & other expenses. So really, “It is possible to afford a 2-person apartment with a 40 hour minimum wage work-week in all Canadian provinces”? Try doing your homework before posting next time.
Falsum
November 22, 2012
D,
I did do my homework. If you re-read the post, you’ll see I cited all my sources. If I’ve made a mathematical error somewhere, then please point it out.
The difference between our two conclusions is that you are including car and gas expenses. I am not assuming that our hypothetical minimum-wage earner has a car. Indeed, in major cities, which have some of the most highest rent in the country, car ownership is not generally necessary.
My analysis considers rent alone, with the point that in many provinces there is little money left over afterwards for transportation, food, education, and all other expenses. Given that, your analysis doesn’t really disagree with mine. I’m not sure where you’re writing from, but if car ownership is essential there (as it is in many parts of Canada), then your point is very valid-a minimum wage earner renting a two-person apartment will be faced with the very difficult choice between transportation and food.
In any case, the real point of the post isn’t the numbers-you can find more qualified bloggers than me to talk about the financial realities faced by most Canadians. I’m more interested in the philosophical point I make towards the end.
Anyway, thanks for commenting.
Rob
December 22, 2012
Why didn’t you just block his comment. He obviously hadn’t read your article.
M
November 23, 2012
I live in Dawson Creek, BC. A vehicle is definately essential as the weather here is quite cold. A 1 bedroom apartment rents for $1100/month. A 3 bedroom house rents for $2500 or more. I don’t know many people that can afford that on one income.
Rob
December 22, 2012
While I agree with your statement that not everyone can “make it” to higher incomes, I don’t find much good argument for that up in your article. I would say that what isn’t considered is the mental barrier to doing something at a higher level. I’d ask D above why he didn’t become rich instead of just starting a business that will probably die when his phsical ability winds down. That is, if it’s so easy, why don’t they all become even richer? In addition, did his parents (if he had any – others don’t have one or both) have a job or an education? Did he rise above his family’s expectations, or not meet them? Etc etc.
My point is that every step up requires a combination of motivation, imagination, mental flexibility, and as much effort to become a $50k earner than D would have to make to become a $250k earner. All 4 of those things have to line up. I speak from experience in that I’ve managed to go from social handouts to above average salary, and could NOT do it again to get to the $250k level.
So I think the “I did it so anyone can” just shows ignorance of the differences between people.