WASHINGTON – Affordable housing remains far out of the reach of Maryland workers who earn the minimum wage, and the gap between income and housing costs just keeps getting wider, according to a new report.
The study by the National Low Income Housing Coalition, released last week, said a minimum-wage worker would have to put in 96 hours per week in order to comfortably afford a modest, one-bedroom apartment without busting the household budget and sacrificing other domestic necessities. The number jumps to 115 hours per week to afford a two-bedroom unit.
Put another way, the minimum wage of $5.15 per hour would have to almost triple, to $14.86 an hour, to make housing affordable for minimum-wage workers. That’s about what a law clerk or a carpenter makes in Maryland.
That figure, which the coalition calls the housing wage, has increased by about 12 percent over the last three years. Maryland had one of the 10 largest increases for non-metro areas during that period, the coalition said.
“The wages we are paying are just not keeping pace with the price of housing,” said Becky Sherblom, the executive director of the Maryland Center for Community Development.
But some cautioned against using the report to call for an increase in the minimum wage — as the coalition does.
“When you think about Maryland, if you look at the ads, people are being paid a lot more than minimum wage,” said Miles Cole, vice president for government affairs at the Maryland Chamber of Commerce.
Cole said that very few people in the state stay at the minimum wage for long, even when they start out that way. He pointed out that there are more factors than income affecting housing affordability, including zoning requirements.
“History has shown that increasing the minimum wage causes employers in industries with tight margins to figure out a way to do without workers when they can,” he said. “They can use one employee versus three and that’s not good for low-income workers.”
The coalition study found housing affordability, as measured by the estimated number of hours a minimum-wage worker would have to work, varied widely across the state. It ranged from 78 hours for a two-bedroom unit in some Eastern Shore and far Western Maryland counties, to 141 hours in some central and southern countries.
The U.S. Department of Housing and Urban Development considers housing affordable when it costs 30 percent or less of person’s gross income. The coalition’s annual study, “Out of Reach: America’s Growing Wage-Rent Disparity,” estimates the affordability of the Fair Market Rents established by HUD.
Despite the range in rents in Maryland, about 39 percent of all 639,108 renters in the state spend more than 30 percent of their gross income on housing.
The report said there is no single jurisdiction in the country in which a minimum-wage worker can afford the Fair Market Rent for homes in their community. National Low Income Housing Coalition President Sheila Crowley called the report a “stark picture of housing affordability in America today.”
-30- CNS 10-05-01