Central Florida is such a low-wage landscape that we spend most of our time talking about what residents must do just to keep roofs over their heads.
Frankly, that’s a pitiful goal.
No one grows up dreaming of barely scraping by. Most people also want to save for retirement and their kids’ college education. And take vacations.
But because this is a community that runs on — and courts — low-wage jobs, we’re consumed with discussions about how people who make $30,000 a year can make ends meet.
That’s why I did a double-take when I read a recent study about the “Salary Needed to Live Comfortably” in each American city.
Think about that: To live comfortably. Not to eke out a living where every week’s paycheck is immediately spent, but enough to put 20% in savings. And to have 30% for things you enjoy in life, like taking your family out to eat, to a Magic game or on a two-week vacation.
That’s the formula that the online finance and data company SmartAsset.com used — 50% for necessities, 20% for savings and 30% for entertainment and hobbies — in conjunction with MIT’s “living wage” calculator, to determine what it costs to “live comfortably” in every major American metro.
For an individual in Orlando, they concluded it’s $100,298 a year.
At first, I scoffed. That seemed high. But then I decided to go beyond my gut reaction and look at the numbers.
That’s when I realized that the Heart of Florida United Way has been reporting for years that it takes between $90,000 and $98,000 for a family of four just to cover basic living expenses here. Mind you, that amount doesn’t contemplate savings or retirement. That’s just to get by.
I also had to realize that $100,000 — the proverbial “six-figure salary” that was some kind of magical benchmark when I was growing up — isn’t what it used to be.
Sure, $100,000 was a big deal in 1990. But to earn the equivalent of that today, you’d have to make $240,000.
Put another way: A $100,000 salary today is basically what a $42,000 salary was worth back then. Check the inflation calculators for yourself.
So before we even get to living “comfortably,” let’s look at that $90,000 figure United Way says a family of four with two young children needs just to make ends meet. That’s $2,000 a month for housing, $225 a week for childcare for each kid, $1,060 a month for food, $950 a month for transportation, $800 for health care, $100 for mobile and internet and $700 for various other expenses.
Again, that doesn’t account for any savings. Nothing for college or retirement. Heck, it doesn’t even allow for an unexpected major car repair or medical expense. That’s just to get by.
Then you have to understand: Most families in Central Florida do not earn that much. Not even close.
According to the Bureau of Labor Statistics, the median wage in Orlando is $39,020. The median household income is around $65,000.
So what we already know is that, thanks to an economy built around hospitality, the majority of full-time workers here don’t make enough to make ends meet. It’s why our nonprofits are strained, our by-the-week motels are packed and our ERs are burdened.
Yet to live the life most Americans want — allowing them to make investments, save for college, enjoy nights out and spend on their family — SmartAsset said the average American needs to make $96,500 a year. That’s just for an individual. A family of four would need upwards of $200,000, the company found.
Orlando’s $100,298 figure was higher than the national average, largely because the cost of living here has skyrocketed. We used to be known as a cheap place to live. Now we’re more expensive than most.
Orlando’s number was way less than the costliest city on the list — New York at $138,570. And way more than the cheapest — Houston, Texas at $75,088.
Orlando was sandwiched between cities like Austin, Texas ($99,757) and Charlotte, N.C. ($101,338).
These numbers will probably upset some people, particularly those who try to portray Central Florida’s economy as something rosier than it is.
But these numbers are just that — numbers. They don’t care about your opinions or your feelings.
Maybe you have a different definition of “comfort.” Maybe you think that $150,000 would be enough for a family of four to live the life they want. OK, well there’s still no denying that the economy we’ve created doesn’t allow the majority of people to make ends meet, much less meet even that lower level of “comfort.” (Again: The median wage here is $39,020. Half of the region’s jobs pay less than that. Orlando consistently ranks as the lowest-paying major metro in America.)
Orlando: 50th out of 50 in wages with costs-of-living on the rise | Commentary
Now, some people say: Well, if the working poor want more money, they should get a degree and get a better job. Those people miss the point. Even if every theme park and hotel employee in Orlando got a PhD, all those low-wage positions would still need to be filled — in part because we keep spending billions of tax dollars to subsidize and grow those industries.
Also, the disparity between salaries here and the cost of living is only getting starker.
Earlier this month, the City of Orlando released a report that showed the median home price had risen by 150% over the past 10 years while the average household income had increased by only 46%. Those numbers don’t add up to either sustainability or livability.
So there are only really three things we can do.
1) Artificially raise wages through more minimum-wage increases, which also inflates the cost of living.
2) Stop relentlessly courting and subsidizing low-wage jobs and instead focus on high-wage ones — the way most communities do.
3) Nothing.
I prefer No. 2. It’s the most free-market approach. It’s the most common sense. And it’s the one that would allow the most people here to not only make ends meet, but “live comfortably.”
