By CHEYNA ROTH
Capital News Service
LANSING — Michigan minimum wage earners are not making enough to afford their most basic needs like housing, food, clothing or transportation, statistics show.
The Michigan League for Public Policy argues that the minimum wage of $8.15 is not enough to live on. In Lake County, for instance, a single adult, full-time worker would need to make $10 an hour to meet basic needs, according to a 2014 study by the league. In Grand Traverse County, the amount goes up to $11 an hour. In Manistee County, you can get by on $9.94 per hour.
Not a single county lists $8.15 per hour or less as meeting the basic needs wage.
Take rental housing. According to Megan Bolton, research director for the National Low Income Housing Coalition, homeownership rates declined and are still declining after the foreclosure crisis. This has resulted in a huge surge in the number of renters.
Affordable housing is considered in terms of its fair-market rent, based on the cost of the 40th least expensive rental rate in an area. Minimum wage does not allow single people to afford fair-market properties, said Peter Ruark, senior policy analyst for the Michigan League for Public Policy.
While some properties might be available below those prices, this housing is often undesirable with the cheapest housing being substandard or potentially unsafe, Ruark said.
Eric Guthrie, the state demographer for the Bureau of Labor Market Information & Strategic Initiatives, agreed.
“There technically are places that are available,” he said. “That doesn’t mean that they are desirable or they would work for every person.”
Sarah Lucas, the regional planning department manager for Networks Northwest, formerly Northwest Michigan Council of Governments, says it is almost impossible to find affordable housing in Traverse City while making minimum wage. Rental housing that is affordable brings issues with safety and quality, including old septic systems, bad roofs, and poor insulation. This housing is also located out in the county, which brings increased transportation costs.
The historically accepted standard of affordability for housing, and the standard generally used by rental assistance programs, is 30 percent of an individual’s income. In Grand Traverse County, the fair market rent is $167 more per month than those on minimum wage can reasonably afford.
So how do single minimum wage earners get by? The answer appears to boil down to two choices – find a roommate, which could potentially help with housing costs, or obtain government assistance.
Lucas indicated that a lot of people are in fact doubling up with friends and family members to make ends meet. In most places, a two-bedroom apartment is affordable if both renters make minimum wage. However, in Grand Traverse County, the fair market rent for a two-bedroom is $825 per month – which is cutting it a lot closer at $412.50 per person.
Still, finding a roommate is often easier than trying to obtain government assistance. According to Bolton, only one of of four eligible households nationally actually receives the rental assistance they apply for.
Traverse City is facing “a perfect storm of rental issues,” Lucas said in an interview. For those living there, not only is there a waiting list for rental assistance (some as long as two years), but there also just isn’t affordable housing available. In some cases, even when assistance is available, no affordable housing is available, resulting in people returning housing vouchers.
The problem with waiting lists is not specific to the Traverse City area. The Housing Choice Voucher Program, the federal government’s major program for assisting very low income families, has a waiting list for many counties.
Lake County had a waiting list from Nov. 1, 2014, until Jan. 31, 2015. Mackinac County’s waiting list opened Nov. 1, 2013, and is currently without a closing date. Lowincomehousing.us — an online resource for finding affordable housing options — lists only three available low-income or income-based apartments in Big Rapids. Manistee has one.
“Communities have more power to impact affordable housing than they do perhaps wages,” Lucas said. “The wage thing is always going to be there, that always has to be a consideration; but to the extent that we can impact some of the basic living costs for residents especially those earning minimum wage, it’s definitely within our power to do so.”
By CHEYNA ROTH