Decades of stagnant wages, rising costs and frequent economic crises in the United States have put millions of Americans on the brink of financial abyss. Just to make ends meet, a family with one adult and two children needs to earn an average of $35.80 an hour – a level of income that exceeds what most households across the country earn, according to a new study. of the 2022 County Health Rankings.
Of more than 3,100 counties nationwide, only two offer a living wage for the average worker, said Keith Gennuso, one of the study’s lead authors. A living wage covers the cost of food, housing, childcare, medical care, and transportation, but does not provide for retirement savings, college fees, emergency savings, or retirement savings. other expenses that can help families achieve long-term financial security.
An hourly wage of $35.80 equates to approximately $74,400 in annual income. The average hourly wage was $31.73 in March, or about $66,000 annually, according to the latest government data. That means many families are falling behind in their ability to afford basic necessities, said Marjory Givens, co-director of County Health Rankings, which is a program of the University of Wisconsin.
“It’s certainly a clear indication that economic security is out of reach for many,” Givens told CBS MoneyWatch. “It’s a call to action.”
The two counties where incomes meet or exceed basic living wages are Los Alamos County in New Mexico and Williamson County in Tennessee, according to the analysis, which relied on 2021 data from the calculator living wage from MIT professor Amy Glasmeier. Both of these counties “appear to be relatively high-income counties with a lower cost of living and good health outcomes,” Givens noted.
Los Alamos County, home to the Los Alamos National Laboratory, has a median household income of over $111,000. Williamson County, Tennessee, near Nashville, has a median household income of about $118,000.
A living wage is not uniform across the country, with some regions — like expensive coastal cities such as New York and Los Angeles — having significantly higher base costs than other regions. The study found that the living wage stands at $29.81 an hour, which is enough for the bare necessities in Holmes County, Mississippi, and can go as high as $65.45 an hour. time in San Francisco.
Inflation erodes wage gains
Workers are now seeing significant wage gains amid labor shortages, but these increases arethat inflation far exceeds the typical wage increase. This is putting more workers under financial pressure as they seek to regain their footing amid the ongoing pandemic.
The county’s health rankings leveraged 2021 data, but doesn’t fully reflect the surge in inflation toward the end of 2021 and into 2022, Givens noted.
At the same time, families continue to suffer financially from long-term structural issues such as sexism and racism, with the report pointing to the gender pay gap as detrimental to the well-being of families and the economy. Women earn about 81 cents for every dollar earned by men, with an even larger gap in the Southern and Western Plains states, the study found.
The pandemic has exacerbated the financial hardship faced by many women in the workforce, with women’s labor force participation rate falling to its lowest level in 30 years. In some cases, this was due to women with children having to take time away from work due to a shortage of childcare and other challenges.
“We already knew that women faced discriminatory practices in the workplace, and our systems do not prevent women from being fully able to participate in the workforce,” Givens said. “These are systems and structures that we have to deal with.”
Childcare unaffordable in all counties
Childcare is generally considered affordable if it costs less than 7% of a household’s income, but the study found no US county where childcare for two children is at or below that. threshold. This is a major barrier for families and childcare providers themselves, whose low median wages make it virtually impossible to pay for outside care for their own children, the study found.
“A childcare provider with two kids probably couldn’t even afford their own services — that would be 50% of their income,” Gennuso said.
Older children are also disadvantaged in much of the country, with the study finding that public schools are underfunded in many parts of the country, the researchers said. About half of all U.S. counties are operating with a public school funding shortfall, requiring an average of an additional $3,000 per student, and with the largest shortfalls in Southern states.
“We know that a well-funded school can put a child on the path to success and a healthy life,” Gennuso said. “Schools need resources to provide this quality education, and we know that’s not the reality in the United States”