Lowcountry counties require highest hourly wage in state to afford rent, national report finds

Lowcountry counties require highest hourly wage in state to afford rent, national report finds
People who live and work in the Tri-County of South Carolina face the biggest struggle in the state to afford a “modest” two-bedroom rental, a new national report finds. (Source: AP)

CHARLESTON, S.C. (WCSC) - People who live and work in the Tri-County of South Carolina face the biggest struggle in the state to afford a “modest” two-bedroom rental, a new national report finds.

The National Low Income Housing Coalition released its annual “Out of Reach” Report, which compares rental housing costs against minimum wage.

The report states South Carolina has the 31st highest “housing wage,” the hourly rate of income it says is required to avoid spending more than 30% of your income on housing.

South Carolina’s current minimum wage is $7.25 per hour. The report states that based on an average fair market rent of $771 per month for a one-bedroom home, a minimum wage earner would have to work 82 hours per week to avoid spending more than 30% of their income on housing. The same worker would have to work 95 hours per week to afford the two-bedroom fair market rental rate of $900 per month.

The so-called “30% rule” was designed to set an amount of income a family could spend and still have enough left over for other nondiscretionary, or mandatory, spending like debt, car payments and food.

“The struggle to afford rental housing is not confined to minimum-wage workers,” the report states.

The average renter wage in South Carolina, according to the report, is $13.52 per hour.

With the $900-per-month fair market rent for an average two-bedroom rental home in mind, the report finds South Carolinians need to make $17.30 to afford their rent without spending more than 30% of that income.

Keep in mind that $17.30 is the state average. That figure jumps to $22.67 per hour in Charleston, Berkeley and Dorchester Counties. Beaufort County residents would need to make $19.77 per hour, the report states.

The report then compares the two figures, the necessary hourly wage and the average hourly wage, to determine the number of full time jobs a resident would have to work to reach the necessary wage.

In Berkeley County, for example, where an average two-bedroom monthly rental would cost $1,179 and the housing wage sits at $22.67, the average worker, who makes $19 per hour, would have to work 1.2 full time jobs to reach that level of income.

Charleston County residents would need to work 1.4 full-time jobs to make enough salary to afford the rental, while Dorchester County residents would need to work 1.9 jobs, the report states.

Location Hourly Wage Needed Average 2-BR Rental Cost Est. Mean Hourly Renter Income FT Jobs Needed to Afford
South Carolina $17.30 $900 $13.52 1.3
Beaufort County $19.77 $1,028 $12.13 1.6
Berkeley County $22.67 $1,179 $19.00 1.2
Charleston County $22.67 $1,179 $15.66 1.4
Colleton County $13.08 $680 $12.55 1.0
Dorchester County $22.67 $1,179 $12.25 1.9
Georgetown County $14.38 $748 $11.55 1.2
Williamsburg County $12.52 $651 $13.77 0.9

Colleton County scored 1.0, meaning they are near close enough to the rate that they would not need a second job.

Williamsburg County is one of only six counties in the state in which the average estimated mean hourly wage exceeds the hourly wage the report labeled as necessary to afford rent.

The report listed Edgefield County as having the biggest discrepancy. There, it found workers earn an average of $7.71 per hour and would have to work 2.1 full time jobs to bring home the necessary $16.31 per hour, on average, to afford the rental.

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Residents in South Carolina’s nearest neighbors have a slightly higher “housing wage.” In North Carolina, they would need to make $17.67 per hour; in Georgia, the rate would be $19.11; and for Florida residents, it increases to $24.43 per hour.

The report found Arkansas had the lowest housing wage at $14.19, while Hawaii had the highest at $38.76 per hour.

The National Low Income Housing Coalition was established in 1974 with the goal of “achieving socially just public policy that ensures people with the lowest incomes in the United States have affordable and decent homes,” the report states.

The report states income inequality has increased significantly during the last 40 years as the country experienced a decline in middle-wage earners and an increase in earners at either extreme.

“Between 1979 and 2018, real hourly wages grew 1.6% for the lowest-wage (10th percentile of) workers, 6.1% for median-wage workers, and 37.6% for the highest-wage (90th percentile of) workers,” the report states, citing 2019 Congressional Research Service findings. “The real median gross rent, meanwhile, increased by approximately 37% between 1980 and 2018.”

The pandemic has had “an especially devastating impact on many of the workers in the lowest paid fields,” the report states.

“The Bureau of Labor Statistics estimated that the job sectors most directly exposed to COVID-19 shutdowns were restaurants and bars, travel and transportation, entertainment, personal service (e.g., daycare providers and barbers), some retail (e.g., department stores), and some manufacturing (e.g., aircraft manufacturing),” the report states. “Those industries account for more than 20% of all workers, and they have a disproportionate number of low-wage jobs.”

It found Black and Latino workers were especially hard hit in the pandemic and that their unemployment rates were already higher than their white counterparts before the pandemic, but said the racial disparity increased in April and May.

“People of color disproportionately face greater challenges in finding decent and affordable housing in the U.S., and income inequality contributes to those challenges,” the report states.

The NLIHC has released its “Out of Reach” report every year since 1989 to show the discrepancy between income and housing costs.

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