Living Wage

November 4, 2005

I have been thinking that a limitation to my study was the fact that TRIO measures the poverty level differently than the national poverty threshold and so I can’t compare my findings to other research on low-income families. Yesterday I was doing a little more investigating and learning more about the poverty threshold and learned some really interesting information. First TRIO uses the next tier which is 150% instead of 100% of the poverty threshold, meaning $28,000 as the income cutoff. Some programs (like Medacaid in Maine) uses 200% as a cut off in order to serve more people. My sample are the working poor of western Maine, meaning that one or both of the parents is working and they are still poor.

Further reading led me to the Living Wage estimates which are much more accurate in determining just how much it actually costs to get your basic needs met in any area. The poverty threshold is calculated my multiplying the cost of a minimum food budget by three (because in the 60’s food was one third of one’s expenses). The living wage is individualized by city, even county and calculates food, housing, utilities, child care, and taxes. These figures show that one would need to make more than twice the amount of income at the federal poverty level to meet the basic needs. In terms of living wage, in Maine it is $37,759 for a family of four compared to the federal poverty level which is $18,392 for a family of four. This just astounds me. Translated to minimum wage, a person living in Maine would need to make $14.84 an hour, while minimum wage is only $6.25 in Maine. I just find this fascinating and maddening. The per capita income in Maine right now is about $18,734, that is $400 above the poverty level.