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Posted: 03/19/14

MLPP report reveals
wages required for basics

by CHRIS GRAY
Observer Staff Writer
      Macomb County has been shown to be one of the most expensive counties in Michigan for raising a family.
       The Michigan League for Public Policy (MLPP) released a report, "Making Ends Meet in Michigan: A Basic Needs Income Level for Family Well-Being," on March 3, which shows a single parent should make $53,639 to afford the necessities in Macomb County.
       The report tracks how much families must earn to cover six basic needs without relying on public or private assistance: Housing, child care, food, transportation, health care and miscellaneous expenses like clothing, household items and phones. Taxes are included in the assessments.
       Peter Ruark, a senior policy analyst with the MLPP, said the report uses numbers for a "bare bone" budget that doesn't include non-essentials like savings or reading materials.
       "It is based on the idea that people that work full time should be able to meet the needs of their families," he said.
       He said the report didn't use the federal poverty level established in 1965 as a gauge because it has outdated figures like spending a third of income on food, and can't be applied to regions.
       "For example, it doesn't take into account that a small town in North Carolina is less expensive than places like Manhattan or Chicago," he said.
       For Macomb County, the report states two working parents with two children under age 5 must make $5,184 a month each to cover the six basics. This translates to each parent making $14.95 an hour for a total of $62,204 a year. The biggest expense is full-time child care at $1,384 a month, as the report assumes the children are not in school.
       In the same scenario, changing one parent to not working drops the net expenses to $2,657 a month, or $15.33 an hour ($31,884 a year) made by the other parent. The drop is from eliminating costs for child care under the presumption that one parent is home for the children.
       A single adult with two pre-school children must make $4,470 a month, or $25.79 an hour ($53,639 annually), which is almost as much as two working parents. Monthly child care costs are the same for a single parent at $1,384.
       These figures are higher than the state averages, which show parents with two pre-school children must make $26,165 a year each, while single-parent families must make on average $44,164.
       "It is fair to say that Macomb County is one of the more expensive counties to live in," Ruark said. "A lot of it is driven by the high cost of child care."
       Out of all the state's counties, only Livingston, Oakland and Washtenaw have higher child care costs than Macomb. Figures were based on the 2013 Cost of Child Care Report by the Early Childhood Investment Corporation.
       The report shows the average monthly cost for child care in Michigan is $1,109, or 44.6 percent of the earnings from a minimum wage job.
       "Many families can kind of cut some of these costs down with things like two-parent families, as they can work split shifts or arrange work schedules so they don't have to pay full-time for child care," Ruark said.
       Macomb County housing was estimated at $629 for a single-bedroom space and $821 a month for a two-bedroom space, according to the 2013 Fair Market Rent from the Department of Housing and Urban Development. The department considers housing affordable if it's less than 30 percent of a household's income.
       A single Macomb County adult without kids should have a monthly income of $2,018, or $24,217 a year. No specific figures were given for families without children.
       MLPP President and CEO Gilda Jacobs said a single, childless person doesn't make enough with Michigan's minimum wage of $7.40 an hour to lift them past those basic needs.
       "We're not including any vacations or any luxuries at all in this report and no savings for retirement or emergencies either," Jacobs said.
       Ruark said the report highlights a need to not only look at increasing minimum wage, but invest in public transportation.
       "Helping people get to and from jobs would be a big part of it," he said.
       An online calculator using the report's findings can be found at www.mlpp.org/calculator.


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Retrieved 7/23/2014 at 8:28:35 PM.
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