Staff Columnist

Housing and wage gap worsens

Study: Iowans earning minimum wage must work 83 hours a week to afford modest 2-bedroom

A sign advertising housing for rent stands in an Iowa City neighborhood. (The Gazette)
A sign advertising housing for rent stands in an Iowa City neighborhood. (The Gazette)

Working minimum wage or better and can’t make ends meet? You aren’t alone.

According to a new report from the National Low Income Housing Coalition, there is no longer any place in the nation someone working a full-time, minimum wage job can afford modest, two-bedroom housing.

Iowans earning minimum wage must work 83 hours each week to afford a two-bedroom unit at fair market rent, as determined by the U.S. Department of Housing and Urban Development. The same worker must clock 65 hours each week to pay fair market rent on a one-bedroom.

On average, workers in Iowa seeking an affordable two-bedroom unit need to make $15.01 per hour, double the current minimum wage. That is $2.51 more each hour than the average $12.50 earned by Iowa renters, who comprise 29 percent of the population.

Drill those numbers down to county levels and you’ll see that Iowans renting housing near population and job centers pay the most. Those who seek out less expensive housing in more rural counties, which still is not affordable for minimum wage workers, see the difference eaten up by transportation costs.

For instance, in order to afford Linn County efficiency housing, which is housing that does not include a designated bedroom, a worker needs to make $9.50 per hour. One-bedroom renters need $11.19 per hour, and those seeking two-bedroom units in Linn County need $14.88 per hour.

Larger housing units in nearby Benton County are less expensive — affordable one- and two-bedroom housing units require wages of $9.94 and $12.50 per hour, respectively — but the cost of driving to a job in Cedar Rapids quickly outweigh the savings in housing costs. Those fortunate enough to find an hourly job near their Benton County housing won’t earn as much, on average, as someone working in the Cedar Rapids area. The average wage earned by renters in Benton County is $8.56 per hour, which is nearly $5 less than the Linn County average.

Like most reports, “Out of Reach” defines affordability in the same way the federal government does: spending no more than 30 percent of income on housing costs. For a family earning Iowa’s median household income, that’s $543 per month, or more than $200 below fair market rent on two-bedroom housing. Yet only a quarter of those who qualify for housing assistance receive it.

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Proposals by the Trump administration include increasing out-of-pocket costs for those who currently receive housing assistance, and cutting additional program funding for 2019.

The practical result of those policies will be more cost-burdened renters in Iowa, some of whom won’t be able to absorb the additional cost. Those who do juggle to make ends meet will have less to spend in the community, depressing the local economy, and many more will be forced to rely on already cash-strapped local safety nets, like food pantries.

This ongoing housing crisis is simply unsustainable, and voters need to make it an election issue. This year, ask political candidates what policies they will enact to help close the gap between wages and housing costs.

• Comments: @LyndaIowa, (319) 368-8513, lynda.waddington@thegazette.com

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