The Cost of Meeting Your Basic Needs

Photo credit: Tour Geek, CC BY 2.0.

Today in “the cost of living,” we go to the Seattle Times:

Just to scrape by in Seattle, a family of four would need to earn $76,000 in a year — an 86 percent jump since 2001 — according to a new report from the University of Washington.

And by scrape by, I really mean scrape by.

There isn’t a vacation, a splurge item at Nordstrom, or even a little treat written into that budget, says the report’s author, Diana Peace, who is a senior lecturer in the UW School of Social Work and director of the Center for Women’s Welfare.

The report in question, The Self-Sufficiency Standard for Washington State 2017, details how much it would cost individuals and families of various sizes to “scrape by” in various parts of Washington State. The report also includes suggested emergency fund amounts for various individuals or families. For example:

A single parent with a preschool-aged child living in Pend Oreille County needs to earn $3,159 per month to meet her basic needs. She needs to earn an additional $111 per month to have an emergency savings fund. If she lives in King County (East) she needs $5,401 per month to be self-sufficient and an additional $166 per month to save for emergencies.

These basic needs, as noted above, include no extras. The report assumes no restaurant spending, for example. If there is public transportation, the basic needs budget does not include a car. The emergency savings fund is only designed to cover basic needs over 2.9 months of unemployment, which is the average length of time that a Washington resident is unemployed.

I’m a single adult with no children in King County (City of Seattle), so I need to earn $2,270 per month to meet my basic needs—if I have a W-2 job. Since I’m self-employed, I need to earn a little extra to account for the 25 percent of my income that goes to taxes. The report includes a 7 percent tax rate, so $2,270 minus 7 percent plus 25 percent is $2,814. I’d need to earn an additional $681 per month to save for unemployment (my number is higher than the numbers in the quoted paragraphs because they count unemployment insurance, which I don’t get), or $3,495 total.

This year my earnings average out to $5,375 per month, for purposes of comparison.

If you want more comparisons, the report ranks the cost of meeting your basic needs in Seattle vs. other metropolitan areas; Seattle is the third most expensive city, after NYC and San Francisco.

Most importantly, the report compares the cost of meeting basic needs to actual wages:

The most common occupation is retail salesperson, which accounts for 3% of all workers in the Seattle-Bellevue-Everett MSA. With median hourly earnings of $13.19 per hour (median annual earnings of $27,423), the most common occupation in Washington State provides workers with earnings that are only 49% of the Standard for this family type in King County (City of Seattle). This single parent would have to work more than two full-time jobs to yield enough income to meet her family’s basic needs. The median wages of this occupation are above the Washington State minimum wage yet are not enough for a single adult to support a child of any age anywhere in King County.

We’ll end with a quote from the Seattle Times:

Pearce says that every three years, when she creates a new report, the gap between wages and costs gets wider.

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