Through mid life, your financial health is not as determined by wages, but by your family/connections. Do you have access to a grandmother who can babysit? A decent second-hand car? A good roommate situation? Just look at the expense table - any one of these things could be worth up to 20% of your income!
And you see that literally right here - are any of us actually comfortable with the idea that the value of your labor should be determined by your marriage status and number of children?
It's kind of telling that countries with "successful" minimum wages either don't have one and just institutionalize collective bargaining, or they do some fancy calculations that start with prevailing median wages and welfare eligibility. The idea of trying to get this number from the bottom up by building expenses just doesn't seem very robust.
Private industry should concentrate on paying people their market wages. Government should tax industries and individuals and provide a safety net.
Let me tell you from first hand experience what happens when unions get involved with manufacturing industries where they can pick up and go elsewhere - they do. Growing up, the city I lived in had 5 factories - all but one left because of fights with unions.
Where I use to live in the burbs of Atlanta, according to the website, the living wage is $45 an hour. Should we have a minimum wage there of $45 an hour?
Because if they don't, they are externalising the true costs of labour to the government, or the community.
Which is fine, by the way, but they cannot then turn around and oppose the cost of taxation needed for gov programs which support people who aren't receiving that living wage. Nor, and worse still, oppose a living wage and then force work people to work such long hours that they cannot sustain a community that can provide the extra support needed to maintain a decent life.
This has literally happened even in Big Tech, leading to lawsuits within the last decade.
If a business can't pay a person working full time to satisfy their basic needs, their business model is not viable. If they can and don't pay so, it's plain exploitation. Ex. Walmart employees can't support themselves and rely on social services despite having a full time job.
> “It seems to me to be equally plain that no business which depends for existence on paying less than living wages to its workers has any right to continue in this country. By "business" I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level-I mean the wages of decent living.”
> FDR
It was supposed to be a "living wage".
Letting companies pay less than a living wage and providing a robust government safety net just subsidizes businesses using government tax money. The biggest beneficiaries of this are companies like Wal Mart, who gets effectively subsidized to the tune of $6B+ a year because so many of its employees are on SNAP and similar low income programs[1].
[1] https://www.ufcw.org/press-releases/wal-mart-has-highest-num...
It's kind of like the physics joke about assuming a spherical cow in a vacuum.
Many young people I know live on much less than this.
This is more like “optimal wage to live alone in my own apartment with a car.” Which of course, people would like to have but certainly isn’t required to be comfortable.
For example, transportation costs are $9000/year and housing is $20000/year. These are both way more than is necessary.
They need better branding because calling this a living wage is a misnomer and harming their cause.
This is a debatable goalpost. It seems more reasonable to me to assume that meeting basic shelter needs includes having a private room to oneself. The only reason to argue otherwise is to try to drive down the wage further, and is that at all necessary? Renting a private room was possible on nearly any wage 50 years ago, and the only reason it seems out of reach for many now is because purchasing power has been slowly stagnating for decades, while housing costs have soared in recent times. Yet this whole time, GDP continues to rise. It seems that our society can easily support much higher minimum wages (and this would likely have only a positive effect of stimulating the economy), but simply chooses not to.
50 years ago, in high cost of living areas, you could rent an SRO, but now they're either banned or practically banned because they're strongly disincentivized against. Combine this with not building enough new housing and you get a recipe for rent increases. Even if a minimum wage works as intended, it can only subsidize demand, which would do nothing when the bottleneck is the supply.
I think it's reasonable for young people to have flatmates and share an apartment, for example.
I think others pointed this out but I don't think you can find any data to prove this because its not true.
I'm not a historian but I have seen a number of old movies and in those movies it was very common for the characters to be some poor schlub with a full time job at the factory living in some sort of group home/flophouse situation. Movies tend to reflect stories that resonate with the public at the time so I suspect that is because this was a common situation. I'd much prefer a single roommate in an apartment to a flophouse.
Why would that be reasonable? College students and young adults usually have roommates. I don't feel it's inhumane.
> The only reason to argue otherwise is to try to drive down the wage further
Another reason to argue otherwise is because you care about the truth. Even if you and I agree on the ends, if you use the means of exaggerating or stretching the truth to get there, you are never on my side. Saying that you need to not have roommates to live is an exaggeration.
> Renting a private room was possible on nearly any wage 50 years ago
You will never find any data to support that because it isn't true. 50 years ago, flophouses were common. You would share a bedroom room with others, with shared kitchen and bathroom between multiple bedrooms. In college, I lived in a housing-coop network where we slept two to a room. 50 years ago, they slept 4 or 6 to a room in my exact house.
> and the only reason it seems out of reach for many now is because purchasing power has been slowly stagnating for decades, while housing costs have soared in recent times
This is true. But there is a very natural reason why. Look at nearly any US city, and see how many more jobs there are in that city than there were 50 years ago. Then look at how many more homes there are in that city than there were 50 years ago. You will see that the number of new jobs far exceeds the number of new homes. The result is that wealthier people bid up the housing, while poor people are forced to live outside the city and commute. So why have no new houses been built? It can't be helped by the fact that building new homes is illegal. (e.g. buildings with 3 or more apartments are illegal in 70% of san francisco.)
Please direct your anger in the right direction! It's not generally the case that billionaires own thousands of homes, hoarding them while the poor live on the street. It's more often the case that the population has increased while the number of homes in places people want to live has stayed the same. The *only* solution is to increase the number of homes in places people want to live. Raising the minimum wage, taxing the rich, fighting corporations, adding rent control laws, none of that will help solve the root of the problem, the growth rate of homes in cities is far slower than the rate of people wanting to live there!
Not to mention you need to be able to save money for unemployment and rainy days..
$9000/year is a ton more than just having a car.
The calculator suggests $5,021 for food, but for me I’d only shop at high-end grocery like Whole Foods and buy organics whenever possible. That’s clearly not enough. On the other hand it suggests $1,792 for internet and mobile which is about double what I actually pay and I have both unlimited mobile data and unlimited home data. Then it claims medical costs of $2,890. For a fit individual with good employer-provided health insurance, that figure should be almost zero.
Ultimately the amount one spends for living depends very much on one’s preferences and these calculators are approximates. I believe you when you say many young people can live for much less, but that doesn’t invalidate the calculator.
No, it won't be almost zero because they're including health insurance premiums in that figure. Few jobs in the US cover 100% of the premiums for their employees.
>> The cost of health care is composed of two subcategories: (1) premiums associated with employer-sponsored health insurance plans and (2) out-of-pocket expenses for medical services, drugs, and medical supplies.
Even on the smaller things. "Internet & Mobile" for where I am jumped out to me. Based on the difference between 1 adult and 2 adults, it's $582 per person-year for mobile (which I guess isn't far off if you get a good new phone every 2 years, it's reasonable enough) and with that subtracted, internet is $100 per month. The methodology page says "County-level data on the cost of internet comes from research on lowest-cost monthly plans from BroadbandNow", but even that page shows much cheaper options available (including the $70 per month Google Fiber I have).
I was surprised (at least for Birmingham/AL/Jefferson County) how accurately it pegged _most_ of the costs -- childcare here is closer to $12k/annum/child so that one was the only one I pegged as 'off' - they show 2 children as $16k and that's a ~$8k underestimate
I spend $20/month for mobile and buy a new $500 phone every 3 years.
I make way more than a livable wage, but spend much less than their projected costs.
The minimum wage is far below what it takes to actually 'live', like have a place to live and a car.
An appartment and a car aren't exactly luxury goods. Cars are often needed to work, and well, having a roof over your head is usually required for a decent living.
Sure, if you fancy living in a cardboard box located next to your work, your living standards are going to be much easier to attain.
Their cost estimates are much higher than what’s required to live comfortably and save for a rainy day.
After looking at the method, I think the calculator probably has some bias towards “what society has convinced us we need”. To a certain extent that is a relative and subjective perception problem, and one exacerbated when you live in a society with a lot of consumer debt.
I would expect living wage to mean the amount one needs to be able to live out your life fairly decently and with dignity. I think many do so without having pay this high.
The average person is not-quite healthy, at best.
If you need roommates because you can't afford an apartment on your own, you are poor by definition. That's probably the most universal definition of poverty that has ever existed. As long as there have been houses, the baseline household has had a housing unit of their own. Households that have to share housing with others have always been characterized as unusually poor, no matter the continent and the millennium.
Historically speaking this is incredibly wrong.
Nearly every culture evolved from some sort of shared communal longhouse to individual clan homes, to extended family homes. The idea of individual private rooms actually comes about explicitly from Manors in the late medieval ages. We really didn't see widespread individual homes until the industrial revolution. In places like the East, individual rooms were an import from the West.
Even in rare places where there were individual family homes (Ancient Egypt, for one). Privacy and individuality were just not concepts. Through the 1800s, you might have literally been sharing a bed with a stranger in a hotel.
There has also never, ever been a point in human history where living without some sort of roommate was common. Even in situations where you had lots of single workers, they almost always lived in bunkhouses or SROs.
Thus my point. I don’t know what “livable wage” means with these numbers so it’s not very useful for discussion or planning or measurement.
Edit: also the housing cost is probably factoring in a studio or maybe a 1bd for a single person. That may seem luxurious to you, but for many that is the only real option they have (roommates are hard to come by and can hurt you physically and fiscally).
In my 20s everyone I knew had roommates. And it was a good life.
Saying a studio or 1 bedroom is required makes this metric pretty ambiguous.
Thus my point, that this isn’t what’s required to just live. But to live comfortably.
I don’t make a living wage for my region and while I can afford food and a room to rent, I can’t really live a decent life, save for the future or invest in myself, I just barely get by every paycheque to paycheque. Thanks
More the former. A lot of the commenters here are missing that detail. A living wage doesn't mean you can afford all the nice things, it means you aren't starving and can cover the needs for you and your family, but maybe some, but not many, wants.
Needless to say; only old people have homes and only those who have sufficient help get a nice appt.
They do not actually live on less, they sacrifice their health or well-being in order to meet the constraint.
I would argue the calculator grossly underestimates necessities because most of these jobs are not doable in old age, so you need to account for saving $1 for each $1 you make, to support yourself while old. You also need an emergency fund, because in the US you get billed $1000 for the most random shit at the most random time.
I got billed $5000 randomly for an echodardiogram because insurance didn't pay for it despite them saying they would. At least I have $5K to spare, but considering that can happen, that needs to be considered a basic necessity.
If you can't live alone with a car? Then what do you think you are doing?
I've always taken "living wage" to be the wage required to live in reasonable comfort. You won't be owning any yachts or eating caviar, but you should also not be living paycheck to paycheck unless you're acting irresponsibly with your money.
If you're sharing a house or apartment with one or more roommates for reasons other than romance or saving up for a place of your own, to my mind, that's not a "living wage" - it's mere survival. Whether we believe minimum wage should barely let you scrape by or live more comfortably shouldn't confuse the fact that in many places, it doesn't even meet what's considered "poverty wage" (e.g., it doesn't in my local area).
What math are you doing to get $130k with those numbers? That wage works out to around $60k/year.
130k/yr is more like 65/hr.
Here in Norway we have five weeks of holiday plus various public holidays and only 37.5 hours per week adding up to about 1700 hours per year.
Norwegian workers do 1,418 hours per year, one of the lowest in the world
For reference, that's 10:15 per day, 365 days a year. Or 996 without vacations, if you intend to have one day off.
996 has never been a standard work duration for urban workers in China, aside from some tech companies that promoted performative work ethics. And even there, people do take vacations.
Just going off basic numbers:
- 3744/52/5 = 14.4 hour day if they work 5 days a week
- 3744/52/6 = 12 hrs if they work 6 days a week
- 3744/52/7 = 10.3 hrs if they work 7 days a week.
20-25% of total Norwegian government spending comes from the fund.
Edit: And looking into it a little, I'm pretty sure two of those islands actually do have mandatory paid leave after a minimum period of employment.
Edit: Also, the US is a damn oil nation. It has nothing to do with oil, and everything to do with politics.
Those outcomes depend much more on labor policy, bargaining power, and what governments choose to protect. In many places, business pressure and media framing make long hours seem unavoidable, even though they’re ultimately the result of policy choices.
If they had a car they most likely shared it. It was far less safe, didn't have AC, guzzled gas and polluted.
Never ate out and spent a third of earnings on cheap grocery store staples.
College and healthcare was much cheaper, and they got a lot less of it.
We're benefiting greatly from the increase in productivity. We just view our great-grandfather luxuries as our necessities.
But at least they could afford a house, right? I think a lot of people would accept living in a house without AC and more likely to catch fire. Is a house like that cheap today? No, right? It's crazy expensive as well.
>If they had a car they most likely shared it. It was far less safe, didn't have AC, guzzled gas and polluted.
Car technology in the past was worse, we know that. Cars were more affordable though.
>Never ate out and spent a third of earnings on cheap grocery store staples.
Like today then.
>We're benefiting greatly from the increase in productivity. We just view our great-grandfather luxuries as our necessities.
Young people are rotting at home unable to go ahead with their lives because wages nowadays are not enough to pay for a house and a family. Why do people try to deny this obvious reality? Productivity didn't benefit everyone equally and people in the past had more opportunities to build a life inside a standard that was socially acceptable.
You're ignoring the gorilla in the room. Why can't one live in a comparable manner today and bank the difference? Because those things aren't available? Why aren't those things available?
You see this pattern across the American economy. The boomers locked in their house values by passing all the zoning regulations to artificially restrict the supply of housing. AMA artificially restricts the supply of doctors to increase their wages. Accreditation pushed ever higher costs on universities which increased costs, and the availability of loans basically cut off the brake cable. And who do you think is really benefitting from all the companies enshittifying everything and pushing up costs? The billionaires and retirees of course. And the young/working people are paying for it.
The solution for individuals is arbitrage. Remote work, get healthcare abroad, and avoid college tuitions. The fact that these things make sense at all shows how broken the markets are.
"The very reason why we object to state ownership, that it puts a stop to individual initiative and to the healthy development of personal responsibility, is the reason why we object to an unsupervised, unchecked monopolistic control in private hands. We urge control and supervision by the nation as an antidote to the movement for state socialism. Those who advocate total lack of regulation, those who advocate lawlessness in the business world, themselves give the strongest impulse to what I believe would be the deadening movement toward unadulterated state socialism."
--Theodore Roosevelt
It shows $13,641 for my metro (Chicago), but day care costs are easily twice that. Obviously once kids are school-age this is much lower (if going to public school), so maybe that's how you get at this figure.
On the other hand the transportation costs are way overestimated for non-car families (we spend less than $2k/year on local transit for 2 adults and 1 child, obviously this doesn't include airfare for vacations or whatnot). Maybe these are both an artifact of too broad a catchment area (childcare is probably cheaper in the 'burbs, but so likely are average transportation costs).
Also, a lot of the data is at least a few years old now. And the new data that is made available has a fat asterisk on it, if it is from the feds.
$11,896 with 2 children? My Kaiser $14K deductible bronze plan costs $2100 a month. That's more like $25K a year, and that's before I use it... the only reason I have it is in case something traumatic happens. This is the cheapest plan I can get on covered california.
Typically, it tends to cover the bottom of the income level, aka the folks who are trying to get a living wage.
Seems like their methodology is a little broken, wouldn't you agree? My out of pocket is a 14K deductible on top of 25K in premiums.
When I looked at the methodology, some is based on consumer surveys so it may be more reflective of over-consumption. In other words, it prices in what people want or what they’re used to, not what they need. The counterpoint is that maybe some wealthy countries should be pricing in a higher quality of life, but the “living wage” then becomes a bit of a misnomer.
If you look at US BLS and Federal Reserve studies on such things, they make a distinctions between what people actually spend on ordinary expenses and when people can no longer afford those categories of expenses.
An interesting artifact is that incomes across the 15-40th percentile range in the same city don't save much money but still have enough money to pay for all ordinary expenses. That is a wide range of incomes for people nominally spending their entire income on the same things. What actually seems to happen is that average people spend excess income on upgrading their lifestyle until they hit the 40th percentile, at which point the average person starts saving some of their additional excess income.
By my estimations, it's not a great calculator. $2.5k/month for all housing costs. I'm not saying it's not possible to find a studio + utilities but that's not a fun place to live. No AC, no insulation, built for a different climate which was 70 years ago, laundromat or (hopefully) coin-op laundry in building, likely near busy roads (101, el camino) or train tracks with no sound insulation, still extremely car dependent (which is included in this calculator - gas/electricity, taxes, and cars in CA are very expensive), etc. Again, doable but competitive market and not a fun one. You'd be guaranteed to NEVER own any property at that income. Until we have some public housing utopia, I'd say ownership should be accounted for in a living wage. Otherwise, you're gonna get evicted when retirement hits.
Its calculation on taxes seems off to me as well. https://smartasset.com/taxes/california-paycheck-calculator#... Says $72308 in San Mateo, CA gives you $55793 - not $59791. You'd have to make close to $80k/yr to get the amount they suggest to live.
This calculator does not include retirement savings, emergency saving, etc. It just assumes you'll comfortably live paycheck to paycheck until you die and never save a dime. In our country, you will not be getting $60k/yr post tax from social security. So, this is a stupid calculator unless you plan to never retire or never experience job loss (max payout is $450/week for unemployment in CA), etc.
It doesn't include those things because those aren't the things that are covered by a "living wage". Living wage sounds like something good, but it's literally just enough to cover what's needed. Can you afford housing, childcare, medical care, transportation for work, etc. It's a low bar, not a good target, for a society to try to hit. It means people at that wage shouldn't be going hungry or without shelter, but they won't necessarily be thriving.
The core of the problem is that you basically have to have someone define what is an acceptable standard of living. Sharing a flat? Nah, the MIT trained economist thinks that's for the poverty people so that is defined as below living wage. Walk to work? No. You need atleast $10k a year on travel otherwise you're a bus wanker.
A huge amount of this is value judgements on what is an acceptable standard of living from people who benefit from immense privilege but will never experience the thing they're studying.
That artificially inflates the “wage level” needed for the estimated living standard. It also makes the tax figures absurd. No two-parent, two-kid household making $110K is paying 15% of that net in taxes, subtracting deductions, credits and subsidies.
IOW, our “safety net” for middle-income parents could get 5X more generous and this calculator would show the same results.
Having roommates is extremely common.
There are also a lot of room-for-rent situations that don’t show up on the websites listing apartments. If you’re tapped into local networks of younger people there’s always someone with a room for rent or a group of friends looking for someone to take over a room in a house they’re renting together. Not helpful for someone in their 50s moving to a new city, but for young people living on a budget this is just how it works and has for a long time.
If you live in a large city, then it works great.
Whatever you think about Mr Price or his math, I still believe this is the most intuitive description of a "living wage" as a concept.
> The cost of civic engagement specifically is constructed by summing together the Consumer Expenditure Survey’s annual expenditure means for audio-visual equipment; education; fees and admission; other entertainment; pets; reading; and toys, hobbies, and playground equipment by both the size and composition of the consumer unit, which functions as a rough proxy for family size.
To me that's a pretty interesting category. Also it's pretty large at least for the Chicago metro area.
For example, you don’t want me to be the one to define “living wage.” I’ve been a prepper/bushcrafter for 20 years… the ACTUAL “living wage” is _zero_. There are innumerable resources all around you if you know how to find and use them.
For example, the average new-vehicle price in December 2025 was about $50,000. But people earning the living wage mostly aren't buying that kind of car. They could buy a new car for less than half that, or buy a used car. Or they may choose to take public transit.
The thing I want to see next would be the sister calculator: what it would take for a business of X size employees, Y revenue, Z other expenses, to increase wages to these standards.
This feels like it would help to close that gap. Give a business owner a concrete path to take. Just saying something is broken isn't going to get it fixed.
Just typing all this I think I have my weekend project lined up.
Thanks MIT!
How is 1 adult + 3 children at $107.95 and 2 adults + 3 children at $63.97
5 people could require more money than 4. You could say in the 2nd case it's $63.97x2 but that doesn't make any sense either because the table also has 1 adult 0 children $29.31 and 2 adults 0 children at $41.81. Clearly they are not doing 2x to that $41.81 as it would be more than the $29.31 at 2x
Was this AI generated?
And the non-working adult is taking care of children, so reducing childcare expenses.
First row, for https://livingwage.mit.edu/counties/06075
| 1 adult | 2 adults (1 working) |
| 0 Children | 1 Child | 2 Children | 3 Children | 0 Children |1 Child | 2 Children | 3 Children |
| $29.31 | $61.37 | $83.72 | $107.95 | $41.83 | $50.47 | $54.77 | $63.97 |
1 adult + 0 children = $29.31
2 adults + 0 children = $41.83
1 adult + 3 kids = $107.95
2 adults + 3 kids = $63.97
2. Did you look in the costs breakdown? You'll probs find your answers there.
3. I am guessing having a spare adult to take care of 3 children instead of paying for childcare is probably the difference.
See the first row in this table: https://livingwage.mit.edu/counties/06075
Compare 2 adults (1 working) 3 kids to 2 adults (both working) 3 kids
First off, you'd expect it to be
1 adult = X
2 adults = X + X(0.?)
Similarly for kids
1 kids = Y
2 kids = Y + Y(0.?)
3 kids = Y + Y(0.?) + Y(0.?)
But instead, under 2 adults 1 working we see
1 adult = $29.31 (from one adult)
2 adults = $41.83 (so X + X * 0.42)
2 adults 1 kid = 50.47
2 adults 2 kids = 54.77 (so + $4.30)
2 adults 3 kids = 63.97 (so + $9.19)
Then you can also compare 1 adult 3 kids with 2 adults both working + 3 kids
1 adult + 3 kids = $107.95
2 adults (both working + 3 kids) = $55.67
1 adult + 3 kids = $107.95
2 adults (both working + 3 kids) = $55.67x2 ($111.34)
Again, these are nonsense numbers.
According to Wikipedia[1] median household income in the US and Norway is only about a quarter of your 160 kUSD.
I'm pretty sure that most of the people living near me in Norway are not high earners but I don't see any signs of starvation either.
That feels pretty close to accurate.
That highly depends on your definition of "need" and where you live. If you're in a city with ludicrous cost of living, like San Fransisco, then sure. But, that's also why people commute, or just choose to go somewhere cheaper. It's somewhat shocking seeing how much higher the standard of living is, with much less income, outside the big cities.