For a good portion of the population, wages aren't meeting needs in even low cost of living areas.
This article is about the Rio Grande Valley of Texas ("The Valley"):
Report: Valley familes’ salaries too meager
By ELIZABETH PIERSON HERNANDEZ/VALLEY MORNING STAR
AUSTIN — Families in the Rio Grande Valley routinely earn less than what they need to buy life’s basic necessities, a report released on Thursday found.
The study from the Center for Public Policy and Priorities, an Austin-based nonprofit that advocates for working families, studied what it takes to live in 26 metropolitan areas in Texas.
It found that in Texas, a family with two parents and two children must earn between $9,000 and $25,000 above the federal poverty level of $20,650 to stay on top of life’s routine bills.
“There’s a big gap between what people are earning and what it really costs to live,” said Frances Deviney, co-author of the study and a senior research associate with CPPP.
The cheapest place to live in Texas is the Brownsville-Harlingen area, requiring $29,982 to make ends meet, the study found. But half of Brownsville households make less than $26,000, leaving many without enough money to live with stability, according to the center.
The McAllen-Edinburg area is more expensive, about $35,000, primarily because housing is slightly more expensive than in Brownsville, Deviney said. Census data shows the median household income in McAllen is $28,660.
The most expensive area to live is Texas was Fort Worth, costing $45,770 a year, the study found.
Just because it’s cheaper to live in the Valley doesn’t mean it’s easier for those with low incomes, Deviney said.
“When wages correspond to the cost of living, you’re actually no better off,” she said.
Preliminary attempts to compare statewide Census data with the study have found that the median incomes, on average, are slightly higher than the salaries the study determined to be necessary, Deviney said.
“Probably over half the families are making what they need, but there’s a good chunk who are not,” she said.
Deviney said the study’s authors used conservative figures. They assumed families would buy food in bulk, buy little meat and never eat out. Housing costs were figured based on the fair market rate of public housing, which is often less than what families pay for apartments.
The authors also assumed families have health insurance on par with those of a state employee, which is often not the case.
The study did not figure that families might want to save for college, a home or retirement. It did not account for unforeseen expenses like a car accident or extra school supplies, Deviney said.
“When you’re living hand to mouth, on a monthly basis, you’re never going to have the opportunity to get ahead,” Deviney said. “You’re kind of on a hamster wheel.”
Becky Sanchez has a good idea of the feel of that wheel. The 36-year-old mother of two from San Juan earns $10 an hour as a teacher’s aide at a charter school. She would like to work full-time, but the school doesn’t have those positions open right now, she said.
To get by, she sometimes relies on help from her mother or her church, she said.
On Thursday the 1992 Buick Sentry she had driven for six years caught fire on U.S. Highway 281. Now she’ll have to think about a car payment in addition to household bills and credit card debt, she said.
The single mother has no health insurance. Her children, ages 12 and 14, are on Medicaid, which she says “is a blessing.”
“Sometimes I deal one day at a time,” Sanchez said.
Although the Valley has some of the poorest communities in the state, the study found low-income workers statewide face the same problems.
Deviney cited the decline of the real value of wages in recent years, less employer-sponsored health care and regressive tax policies as reasons for the gap between wages and what it takes to live.
To close the gap, the state should increase access to community college, make sure families have government aid until they are self-sufficient and attach economic development aid for companies with workforce training for workers, she said.
This is where I live. Salaries are low here. The article says that median incomes tend to be a little higher than the amount needed, but I'm not sure that actually holds true here. I thought it was interesting to see what figures they used. Government housing prices, only the most standard of household expenses (no school supplies, for example). Only what a family HAS to have for the most basic needs.