In recent years, a number of cities have raised their minimum wage to $15 an hour, which is significantly above federal and state minimum wages. These changes have prompted debate around the country regarding what constitutes an adequate minimum. This report contributes to the wage conversation by providing living wage figures, finding that current federal and state minimum wage rates are far too low to meet individuals’ and families’ needs.
Since 1999, the Alliance for a Just Society has produced an annual living wage report calculating what it actually costs to make ends meet for households in selected states. For the first time this year, the Job Gap Economic Prosperity Series includes a living wage for all 50 states and Washington, D.C.
Our research finds that, although $15 per hour is significantly higher than any minimum wage in the country, it is not a living wage in most states. A national living wage for a single adult is actually $16.87 per hour, based on a weighted average of living wages across the country.
In 35 states and in Washington, D.C., a living wage for a single adult is more than $15 per hour. In no state is a living wage less than $14.26 an hour. This data shows that a call for a $15 minimum wage is, in fact, modest when the actual cost of making ends meet is taken into account.
The federal minimum wage of $7.25 per hour represents less than half of a living wage for a single adult and the federal tipped subminimum wage of $2.13 per hour is less than a third of that the non-tipped minimum wage. A worker supporting only herself would have to put in 93 hours a week at the federal minimum wage to make ends meet, and a tipped worker could have to work more hours than there are in a week to support herself if tips are not enough to make up the difference.
Workers supporting families must earn even more. In Massachusetts, for example, a single parent with two children must be paid $43.30 per hour to make ends meet.
When workers do not earn a living wage, they must either find a way to work more hours or cut back on necessities. Often, these are workers in important occupations that others depend on, such as fast food and restaurant workers, retail salespersons, child care workers, and more. Women and people of color, who are more likely to work in these occupations, are less likely than their peers to earn a living wage.
Increasing the federal minimum wage to $15 an hour and abolishing the tipped subminimum wage would move wages in the right direction, while unionization and enforcement of equal opportunity statutes will ensure that all workers have access to benefits and protections in the workplace.
At a minimum, working full-time should ensure financial stability. Such a change requires action on the part of elected officials.
Download a PDF version of the Executive Summary