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 Market Mysteries of the week

  Does working full-time guarantee you enough money to live off of?

Answer:

Working a full-time job does not guarantee enough income to cover basic necessities throughout the country

.

What is the minimum wage?

The federal government mandates that (almost)

all employees must be paid a minimum of $7.25 per hour

in the United States, roughly $15,000 per year full-time before tax. States are allowed to require their own higher minimum wages, and 29 states and D.C. have higher minimums.

There are ways for employers to pay less.

Independent contractors, tipped employees like waiters, kids under age 20, farmworkers, and seasonal workers at ski lodges or amusement parks are all examples of jobs that aren’t supported by a minimum wage. People in those roles might be making less than $7.25 per hour.

Who’s making minimum wage?

It’s a common misconception that the Americans earning our lowest wages are teenagers.

More than 80% of Americans

earning minimum wage or lower are older than 20 years old

.

More than half are older than 25 years old

.

These are not uneducated workers either

. Roughly

85% of Americans

earning minimum wage or less have a high school degree, 35% have some college education or an associate degree, and 15% have a bachelor’s degree or higher.

Is that enough to live off of?

$7.25 per hour is not enough to support basic needs anywhere in the United States

, according to an in-depth analysis by MIT. Massachusetts Institute of Technology analyzed the cost of living for individuals and families across the U.S., looking at the lowest-cost options across basic expenses. These expenses include food, childcare, health insurance, housing, transportation, and other necessities like clothing and personal care items. MIT’s calculated minimum “living wage” does not include savings, travel, eating out, or vacations.

The necessary “living wage” varies widely by state, but $7.25 didn’t cut it anywhere.

What’s happening now?

Higher wages are a hot topic right now in Washington and across corporate boardrooms.

Major employers from Amazon to Walmart and McDonald’s have raised wages this year

for their own lowest-wage positions.

The corporate wage hikes aren’t purely altruistic. With the effects of the pandemic still far from over, employers are struggling to fill positions. There are more than

2 million more open jobs

than unemployed workers.

Employers are competing to attract workers.

Democrats in Washington have also

proposed raising the federal minimum wage to $15 per hour.

That would be the first raise since 2009. That’s a considerable increase, but for a single adult with no children, a $15 minimum would still

only cover basic living needs for workers in half of the United States.

Would raising the federal minimum wage help?

There’s plenty of debate within Washington as to whether a federal wage hike is the right solution, but

two-thirds of Americans support an increase in the minimum wage

.

An analysis by the nonpartisan Congressional Budget Office found that

a $15 minimum wage would lift nearly 1 million people out of poverty

in the next four years, but it could also create uncertainty around 1.5 million jobs and risk higher inflation for goods and services. Costs of living vary widely by location. Solutions to the problem also vary by industry.

Is your company paying a living wage?

Check out the

living wage calculator

for your area.

Please feel free to forward this to anyone who might find this interesting.💙 The Scoop Team

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