Cost of Living
Cost of living has risen in the United States since the 1800s. The cost living is different in cities and states in America, it is also different between America and other countries. The cost of living in America can be more or less than other countries. Cost of living is the relative price of everyday living such as our basic needs. Our basic needs include housing, food, healthcare, etc. Now that cost of living is more than what is used to be minimum wage is just not making the cut.
It wasn’t until 1910 until the cost of living became an important topic. The origins of the COL lie in the establishment of the Labor Statistical Bureau. It emerged as part of a broader shift in which the state amassed increasing amounts of statistical data as it assumed a more active role in managing the economy and society.
Cost of living is different among people. It varies from city to city and also states to state. It depends on what you make how many people in the household work and kids you have. Cost of living deals with the food. Like do you go out to eat or do you go to the store and get groceries and both? Its depends on your transportation type to you take a bus, train, or driving a car that means your own gas. What kinds of clothes and how frequently you buy clothes? Do you own a house, pay rent to own or pay to stay in an apartment?
Upon looking into more details about Cost of Living, there is plenty of data that explains in so many ways how minimum wage just is not enough. Using Mississippi as an example, the minimum wage is 7.25. It has been that way for a while. Looking at Figure 1, you can see that a one-person household cost of living is taking more than 75 percent of her check.
1 Person household COL
Source: Cost of Living. https://www.numbeo.com/cost-of-living/country_result.jsp?country=United+States
As you see in Figure 1, the total of a one-person household total is $1,454 a month. A net pay of 7.25biweekly. The most they make at home on full time bases is $1,730. When subtracting the total there is on $276 left. That explains that more than 75 percentage wages go to the cost of living. As the cost of living goes up and minimum wages stay the same, it will always take up more than 75 percent.
The measure cost of living by inflation rate so they use a consumer price index known as CPI. On the Chart, 150 indicates a change of 50% inflation and ifs 250 it indicates a change of 150% inflation In figure 2 below you will see the Consumer Price Index.
Source: U.S. Dept. of Labor. https://www.bls.gov/bls/proghome.htm
From 1990 to 2015, food went right under 250 which is about 145% change to 151% change in 2015. Food prices rose each year between .5% to 2%. Housing, on the other hand, as increase greatly over the years. In the years of 2007- 2009 the prices dropped a little but increase right back up after 2010.
The Cost of living has an impact on the wages of everyone lives especially in these times. Cost of living applies to every worker with different origins and backgrounds.
Searle, R. (2015). Is there anything real about real wages? A history of the official British cost of living index, 1914-62. Economic History Review, 68(1), 145-166. doi:10.1111/1468-0289.12059