How much does it cost to make ends meet in California? The answer might surprise you.
A new CBP report, Making Ends Meet: How Much Does It Cost To Raise a Family in California?, shows that families need incomes that are two and a half to four times the federal poverty line and, in some cases, nearly as high as the median family income – the income right at the middle point of the income distribution – just to cover the basics like rent, child care, health coverage, and food. This means that families in many parts of California need incomes well into the middle-income range just to pay the bills.
Our report shows, for example, that a four-person family in California – two working parents and two children – needs an annual income of $75,500 to make ends meet. That’s nearly as high as the state’s median family income for a family of four, which the latest Census data show was $79,477 in 2008. To earn an income this high, both parents would need to work full-time, year-round and earn an hourly wage of $18.15. That means each parent would have to earn more than twice the state’s minimum wage.
Our report comes at a time when millions of families in California are still struggling to make ends meet, even though economists tell us that the recession is technically over. Unemployment remains near record-high levels, and many workers have had their hours of work scaled back. This means that many families are trying to get by with reduced incomes. While housing costs have fallen in many parts of the state, the cost of some basic necessities, like child care and health coverage, has continued to rise, stretching the resources of many families.
As policymakers craft a final spending plan this summer, we hope that they will be mindful of the tremendous number of families having a tough time making ends meet right now, and will support the public structures that working families rely on, such as state-supported child care. Child care costs represent one of the biggest expenses for working families with children – rivaling or even exceeding housing costs in some parts of the state. Affordable child care keeps families working. As we said in a recent blog post, if keeping Californians employed is a priority right now, then child care must be too.
— Alissa Anderson