Just Economics has adjusted its 2019 hourly Living Wage upward to $13.65 from last year’s $13.00 for working people in Buncombe County and surrounding areas.
The organization calculates the living wage using the Universal Living Wage Formula, based on the idea that a person who works full-time (40 hours per week) should be able to afford a one bedroom apartment. The cost of that housing, according to the U.S. Department of Housing and Urban Development, should be no more than 30% of a person’s gross income.
The ULWF formula indexes the wage to the local cost of housing set each year by HUD’s Fair Market Rents; the local rental rate reflects a four-year average. When that four-year average changes by 3% or more, the region’s Living Wage Rate is adjusted accordingly. Because the overall rate increased by nearly 5% from 2018 to 2019, the Living Wage increased by the same percentage.
The four-year average of Fair Market Rent for this area is $709. That amount should be only 30% of monthly expenses, so all expenses for the month should be $2,363.30, or $28,360 per year. To determine the hourly wage needed to afford those total expenses, the total in expenses is divided by total hours worked.
$28,360 divided by 2,080 hours (52 weeks at 40 hours/week), necessitates an hourly pay rate of $13.63—rounded to the nearest nickel, or $13.65.
If an employer provides health insurance, that number drops by $1.50 to $12.15/hour.
Fair Market Rent Calculations for Buncombe County
Year ……. FMR
2019 ……… $799
2018 ……… $660
2017 ……… $713
2016 ……… $664
4-year average ……… $709