Each November, Just Economics reassesses the Buncombe County Living Wage Rate based on Federal Fair Market Rent data released by HUD. In 2020, the living wage rate was calculated at $15.50/hour or $14.00/hour with employer provided health benefits. All new businesses in 2020 were certified at that rate, but Just Economics postponed the 2020 recertification process for previously certified businesses due to the COVID 19 pandemic.
The 2021 Fair Market Rent data was entered into the universal living wage formula in November of 2020 and indicates another increase in the Buncombe County Living Wage Rate to $17.30/ hour or $15.80/ hour with employer provided health benefits. See the calculation here.
This is a unique time and we are considering making some changes to our Living Wage Certification program. Exactly what those changes will look like is still in the works. This has been a difficult time for businesses and workers alike. The unprecedented circumstances from the COVID 19 pandemic have led to the decision for Just Economics to temporarily pause the Living Wage Certification process as we evaluate the next steps for future recertification and for our program overall.
As we enter into a new year and the eleventh month of a pandemic, like many, Just Economics is evaluating what our steps moving forward will look like. It is our greatest hope to avoid adding additional stress on businesses while continuing to a high standard for the Living Wage Certification program and to serve as a resource in educating and advocating for a more just minimum wage.
We will be making announcements in the coming months. At this time, we plan to announce a plan to move forward and a timeline by March of 2021. Regardless of what lies ahead, Just Economics has always allowed an extended time period for businesses to make wage adjustments and is committed to working with businesses through this process during the coming year and beyond.
Frequently Asked Questions
What is the Living Wage and how is it different from a Minimum Wage?
Just Economics defines a Living Wage as a more just minimum wage. The concept is based on the idea that a person who works full-time (40 hours per week) should be able to afford a one bedroom apartment and their other living expenses without public or private assistance.
The minimum wage is determined by State and Federal governments and is the lowest wage that employers can legally pay their workers. The US federal minimum wage was last raised on July 24, 2009, when it rose from $6.55 to $7.25 per hour. The National Low Income Housing Coalition published a report in 2020 showing that the average minimum wage worker has to work more than 2 full-time jobs to afford a 2-bedroom rental in any state in the US.
With a minimum wage that is too low for individuals to meet their basic needs while working only 40 hours per week, the concept of a living wage is intended to help determine a more just minimum wage.
How is the Living Wage Determined?
Just Economics adjusts our wage rate based on the Universal Living Wage Formula which is directly related to the cost of housing. This formula is based on Fair Market Rent as determined by HUD and adjusted using a four year average of the FMR to mitigate any volatile changes up or down. We adjust the wage rate if there is a 3% or greater change from the previous year.
The WNC rural living wage rate is calculated at 210% of the federal poverty guidelines, rounded to the nearest nickel, due to the unreliability of accurate FMR data in rural counties.
Why has the Living Wage gone up three years in a row?
Buncombe County has seen a significant rise in the cost of housing over the last several years as wages remain stagnant. As the cost of living increases, the living wage also increases to keep pace with inflation and the real costs of living.
Why don’t Living Wage Certified Employers have to pay the new wage immediately?
Just Economics recognizes the necessity to give employers notice and a time to adjust their budgets in order to be able to adopt a new living wage rate for employees. The Living Wage Certification program is in part, commitment to continuing to adjust to a higher wage standard over time. Historically, Just Economics has given employers one calendar year to adjust from the previous living wage rate to a new living wage rate.
What’s happening with the Living Wage Certification Program right now?
The unprecedented circumstances from the COVID 19 pandemic have led to the decision for Just Economics to temporarily pause the Living Wage Certification process as we evaluate the next steps for future recertification and for our program overall. We are not currently accepting new applications for living wage certification and we plan to announce a timeline and a plan for our program moving forward by March of 2021.