Tuesday, December 27, 2016

When paying the rent means going hungry


By Aimee Picchi MoneyWatch December 27, 2016, 1:36 PM

It is a sign of the uneven economic terrain impeding the recovery: Although U.S. consumer confidence is at its highest level in 15 years, a combination of stagnant wages and surging housing costs are leaving millions of people scrambling to afford food.

Forty-one percent of cities surveyed by the U.S. Conference of Mayors reported an increase in demand for emergency food assistance. More than half of the Americans applying for emergency food are employed, while only 8 percent were homeless, the study found. The cities with the biggest increases include Des Moines, Iowa, where the number of requests for food help jumped 15 percent, and San Francisco, where it rose 3 percent.

The culprit is the impact of two intersecting trends that is spelling trouble for many working families: slow wage growth in the post-recession years as well as sharply higher rents. In 2013, one of four renters paid half their incomes toward rent, a trend that’s projected by Harvard’s Joint Center for Housing Studies to only worsen over the next several years.
The increase in hungry Americans means that many food pantries and emergency kitchens have had to cut back in the size of servings they can provide, the Conference of Mayors found.

“It is concerning that even people who are employed continue to need the help of food pantries to make ends meet,” said Tom Cochran, the executive director of the U.S. Conference of Mayors, said in a statement.

About one-third of cities reported their emergency food kitchens and pantries had reduced the number of times families or individuals could visit each month, while 47 percent of cities said they had to turn people away or cut back their portions.

As 2016 draws to a close, food pantries around the country are reporting declining donations, although the cause isn’t due to less charitable individuals. Supermarkets, which have historically been among the biggest food donors, have become more efficient thanks to computer networks. That has reduced the amount of surplus food they have on hand to donate to food shelves, according to The Providence Journal.

Renters need to earn at least $20.30 per hour to afford a modest two-bedroom apartment in the U.S., according to the National Low Income Housing Coalition. Its 2016 report on housing affordability noted that hourly wages for workers in the bottom 10 percent of the income distribution rose just 0.2 percent from 2007 to 2015, while the top 5 percent saw income growth of 8.7 percent over that time.

Meanwhile, the amount of affordable housing hasn’t kept up with demand, the NLIHC found. The number of apartments around the U.S. that rent for less than $400 increased by 10 percent from 2003 to 2013, and the number of households who needed these low-cost apartments jumped by 40 percent.

“This burden makes it difficult to afford other basic necessities like healthy food and medication and to save for financial emergencies,” the NLIHC said.

An analysis of household expenditures by The Pew Charitable Trusts found that many middle- and low-income American households are now caught in a financial stranglehold. Costs for essentials such as housing, food and transportation have surged over the last two decades, while income hasn’t kept up. Its study found that low-income Americans end up in a financial hole of $2,300 on average because basic costs are outpacing typical income.


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