Today, The Minimum Wage Won’t Keep A Mama And Baby Out Of Poverty
When Elizabeth was growing up, a minimum wage could support a family of three. Now, a full-time, minimum wage job alone can’t keep a mama and a baby out of poverty.
After Elizabeth’s father had a heart attack when she was twelve, her mother put on her best dress and went out to get a minimum wage job at Sears. That job saved their family. Back then, in the early 1960s, a full-time minimum wage job could support a family of three — pay a mortgage and put food on the table. Now, a minimum wage job alone can’t keep a mama and baby out of poverty.
In 1962, a woman just like Elizabeth’s mother, working full time – 40 hours a week, 52 weeks a year – at the $1.15 minimum wage would earn $2,392 a year, enough to keep a family of 3 with one child above the federal poverty threshold of $2,167, as long as she filed as head of household.
Back in 1962, $199 – the monthly earnings from a minimum wage job – could feed a family of 3 and put a roof over their head. In those days, it cost $78.20 to $120.80 to feed a family like Elizabeth’s with two 50-year-old adults and one 12-year-old child while the average mortgage bill was only $59 and average rent was $71. Taken together, the average family of three would spend between $137.20 to $191.80 on these expenses each month – enough to stay afloat on $199 a month.
Today, things are different. A woman working full time earning the federal minimum wage of $7.25 makes $15,080 a year, not enough to keep herself and a baby above the federal poverty threshold of $17,308 in 2018, let alone above the $20,212 threshold for a family of 3.
Today, it just isn’t possible to feed a family of two and make the monthly rent or mortgage payment on the minimum wage. In 2018, the USDA estimated that it cost $280 to $504 to feed a family of two – a 26 year-old-mother and a one-year old baby – each month. These days, the median homeowner pays $1,041 a month and a median renter pays $982 a month. Taken together, it cost between $1,262 and $1,545 to cover these expenses in 2018. At $1,257 a month, the monthly earnings from today’s minimum wage cannot meet these expenses for a family of 2, whether they rent or own, or commit themselves to the most thrifty food budget.
Why could the minimum wage keep a family of 3 above water in the early 1960s when it can’t even support a mother and a child today? Simply put – the minimum wage has not kept pace with inflation while costs for working families in real dollars have skyrocketed.
- From 1972 to 2017, the average annual expenditure for a family of four on housing, excluding fuel and utilities, increased from $9,351 in real 2017 dollars to $15,253 – a 63% increase.
- The average annual expenditure on health insurance for family of four increased from $1,360 in real 2017 dollars to $3,871 – a 185% increase – over the same time period.
- The cost of in-state tuition at a four year public college increased from $3,010 in real 2018 dollars to $10,270 between 1972 and 2017 – an increase of 241%.