How much money does a person or family need each year to be self-sufficient?
The people at The University’s Center for Research (CROW) on Women think they know. The group released its 2002 Living Wage study last week.
The Living Wage measures the level of income required for a family to live independent of monthly public assistance, food stamps, childcare subsidies and rent subsidies.
“The Living Wage is only the amount that is required to provide basic self-sufficiency,” said David H. Ciscel, professor of economics at U of M and study author.
According to the new Living Wage 2002 study, it takes $31,284 a year or $15.64 an hour in a full-time for a family with one adult and two children in Memphis to be self-sufficient.
The Living Wage varies depending on the size of the family. For a family of one adult and one child, the Living Wage in 2002 is $26,128 a year. This amount is up 17.1 percent from the $22,306 Living Wage in 1999.
For a family with two adults and two children, the 2002 Living Wage is $35,130 a year, an increase of 2.5 percent from the 1999 Living Wage of $31,220.
The study showed that rising costs of the Living Wage can be partially traced to rising prices. Childcare and food costs have risen. The costs of clothing and personal care are slightly more generous in the 2002 report than in 1999. But the biggest change is in the cost of housing.
In addition to a general increase in housing costs, the Living Wage 2002 study based rental costs on a higher standard for decent rental housing from the U.S. Department of Housing and Urban Development. Rents below this standard, known as the subsidy level, are considered to be substandard.
In 1999, HUD’s subsidy level was at the 40th percentile of all rents in an area, but in 2002 the HUD subsidy level is in the 50th percentile. That means half the rents are higher and half the rents are lower.
The percentage of Memphis families who do not earn a Living Wage is large, although data was not available to pinpoint the number. According to the U.S. Census, the median household income in the Memphis area is $34,583, which means that half the households earn more and half earn less.
In the Memphis area 15.3 percent of residents live below the poverty threshold, and in the Memphis city limits 20.6 percent of residents live below the poverty threshold, according to the 2000 U.S. Census.
