Washington State Press Release

For Immediate Release
August 26, 2014
Contact: Kathy Mulady
(206) 992-8787

Job Gap: More Working Families Struggling to Make Ends Meet Are Sliding Deeper into Debt

A living wage in King County is $24.06 for a single parent with one child.
Our system sets up families to fail.

SEATTLE — Working families are out of balance — costs are climbing and paychecks are shrinking. Workers who don’t earn a living wage can’t make ends meet. On top of that, many are struggling with deep debt, especially student loan and medical debt.

The gap between minimum wages and living wages continues to grow. Debt is placing a disproportionate burden on low-income families to an alarming degree. It’s an impossible balance sheet.

Job Gap: Families Out of Balance is the first report in the 2014 Job Gap Economic Prosperity Series, produced by the Alliance for a Just Society. The study, released today, shows that a living wage in Washington ranges from $15.99 per hour for a single adult to $30 per hour for a single adult with two children.

In King County, the living wage is higher, ranging from $17.37 for a single adult to $34.46 for a single adult with two children.

The report comes just as King County Councilmembers are expected to vote in mid-September on a living wage ordinance for employees and contractors, and state legislators talk about a $12 statewide minimum wage.

Alliance research figured in the successful $15 minimum wage fight in Seattle last spring. Jill Reese, associate director at the Alliance for a Just Society and a leader on income inequality issues, participated in panels and met with the Mayor’s Income Inequality Advisory Committee.

“These findings paint a clear picture of the disproportionate debt burden shouldered by families making less than a living wage,” Reese said. “These are indicators of larger systemic inequities, and inaction by policymakers around the country is, quite frankly, unacceptable.

“Legislators in states and in Congress must step up now and make investments that help families gain a foothold,” Reese said.

The report looks at five household types in Washington, as well as four counties: King, Pierce, Clallam and Grays Harbor. There is also a national report and data for other states and counties. It’s available at http://www.thejobgap.org

Despite having far less income for each dollar of debt, our study shows that 89 percent of low-income families prioritize making debt payments on time — sometimes going without food, heat or other basic necessities.

A living wage is the hourly pay needed to cover the cost of housing, food, utilities and other expenses, including modest savings.

Seattle set the bar with a $15 minimum wage, while other cities, counties, and the state haven’t kept up.

Our new report includes stories of workers throughout the country trying to get ahead but falling behind, as they struggle with a system that sets people up to fail.

Toni Potter of Puyallup had been laid off and decided to return to college, hoping to improve her chances of getting a better job. Then her husband died suddenly of pancreatic cancer. She had a medical emergency requiring a hospital stay.

Now, every month, she struggles hopelessly to pay medical and student loan bills. She works, but wasn’t able to finish college and find that better-paying job.

“I am drowning in debt with no way out,” Potter said. “I skip meals to make sure my son can eat. I ration my prescriptions. I cannot plan and I cannot save.”

The Alliance for a Just Society is calling on legislators to prioritize families. Here are a few recommendations from our report. More details can be found in Families Out of Balance:

  • Increase the federal minimum wage
  • Reinvest in higher education
  • Address medical debt acquired before the Affordable Care Act
  • Expand Medicaid eligibility
  • Regulate payday lending

Alliance for a Just Society is a national research, policy, and organizing network that advocates at the local, state and national level for economic and social equity. The Alliance, based in Seattle, has produced the Job Gap Study on jobs and wages since 1999.