Growth in Housing Expenses Greater Than Wage Increases
Digested from “U.S. housing costs continue to soar, CPI shows”
MarketWatch (8/19/15) Bartash, Jeffry
It’s already been determined that there is no location in the United States where the minimum wage will cover housing expenses for a one-bedroom apartment. But housing expenses are rising at a faster rate than wage increases, which could make it increasingly harder for more workers to afford shelter.
The cost of shelter rose 0.4 percent last month — its biggest gain in eight years. Housing expenses were fueled by high demand and low supply, which will continue to raise rates until additional units come on the market.
Wages, on the other hand, did not rise quite as high. Real hourly wages increased 0.1 percent in July.
The last 12 months show an even greater difference: Housing expenses grew 3.1 percent — its largest gain since 2008 — while real wages grew only 1.9 percent.
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