In the United States the cost of living increases faster than wages. It contributes to the increasing poverty rates across the country. One of my former co-workers graduated from University of Maryland with a BA in psychology. We were hired the same day. A few months after we was hired, she quit. Long story short, after her and her boyfriend broke-up, she couldn’t afford to pay her rent. It is common for people that was living together to have financial trouble after a break-up. This is a result to the decrease in income in the household. Insight SBS did a piece on a woman that was homeless after her husband walked out in her in Australia. There is a possibility they could end up being homeless in a situation like that. Her degree and being a young white woman opened other doors for her. As the cost of living increases faster than wages, so does poverty and homelessness as more people cannot afford to live in town in which they work.
In Maryland, Amazon is the biggest employer. The company also pay people with no work experience or degree more money than most companies in the state. In 2016 the company starting wages was $12 an hour. That is $2k a month before taxes is taken out. The apartment it was living in was $800 a month just for rent. Once you add other monthly expenses you will quickly understand the reason so many people are living in poverty in Maryland. If you live by yourself, you going to be taxed pay higher taxes than somebody with a child. As a result, you going to be making some tough cuts. Most likely you will not have a car. You may find yourself not going to the doctors that often to avoid the co-pay. This year the same apartment rent is $1300 for a one bedroom. Amazon starting wage is $15 an hour. That is a $400 increase in pay before taxes and a $500 increase for apartment. It is common for people to move from one apartment to another once they can no longer afford to live in the area in which they live.
Dateline SBS did a special on rich Asians migrating to Vancouver from China. Those rich Asian created ghost towns driving up property values in Vancouver. As a direct result of the property value increase most people that worked in Vancouver couldn’t afford to live in Vancouver. Gentrification in Vancouver has made it one of the most unaffordable cities in the world. Those that is employed in the city cannot afford to live in the city. This is just one example of the way gentrification creates homelessness.
One of the ways to bridge the racial income gap is to make buying a house affordable. If people can afford to buy a house, they will have an asset they can pass down to their children. In addition, there must be some type of rent control.