Document / Web Link

Living Wage Calculator

Posted October 27, 2022
Source
Massachusetts Institute of Technology
Author
Amy K. Glasmeier
About This Web Link

This tool helps individuals, communities and employers determine a local wage rate that allows residents to meet minimum standards of living.

The living wage model is an alternative measure of basic needs. It is a market-based approach that draws upon geographically specific expenditure data related to a family’s likely minimum food, childcare, health insurance, housing, transportation, and other basic necessities (e.g. clothing, personal care items, etc.) costs. The living wage draws on these cost elements and the rough effects of income and payroll taxes to determine the minimum employment earnings necessary to meet a family’s basic needs while also maintaining self-sufficiency.

The living wage model generates a cost of living estimate that exceeds the federal poverty thresholds. As calculated, the living wage estimate accounts for the basic needs of a family.