Housing affordability, particularly for median income workers, has become a much-talked about topic of late. Rising rents have forced a large segment of city residents to spend well over 30% of their net monthly income on shelter costs, which can lead to severe financial trauma later on. One of the reasons why city residents are struggling — low city salaries. The urban ideal is to live and work in the same place — however, to do so in Baltimore City is becoming less cost-effective. Even when you factor in transportation costs, depending on your chosen profession, working in DC, and even working in some of the neighboring counties might be more lucrative. For example, if you are an accountant, the median hourly wage in Baltimore City is $30.00. In Baltimore County, that rises to $34.50, in Anne Arundel County, it’s about the same as Baltimore County, and in Howard County, it’s $33.25. My friend Steve, who is an experienced accountant and works in Howard County, earns roughly $41.00 an hour. That’s more than he would earn, on average, in Baltimore City, even for an accountant with the same amount of responsibility and experience.
However, not many in Baltimore City are earning $41.00 an hour, or even $30.00 an hour. In fact, 58% of Baltimore City residents earn $49,999 per year or less, with the majority of those people earning less than $25,000 a year. The fair market rent (FMR) set by HUD, for a two-bedroom home or apartment in Baltimore City of approximately $1250 is well out of reach for most, if not all, of those residents. Yet, despite the lower salaries and despite the rising rents, we’re not making affordable housing for working families a priority, nor are we creating the jobs that can lead to higher salaries for new and existing workers.
When you look at the breakdown of available jobs and education level of residents, it becomes clear which industries need to expand:
Only 27% of Baltimore City residents age 25 and older have a college degree. This means a severe shortage of good-paying steady jobs for the vast majority of city residents. Historically, skilled trades and manufacturing jobs led to greater financial security, homeownership, and retirement with decent pensions/retirement accounts, particularly for those who had no college education. In Baltimore City, however, those jobs are in short supply:
Only 3.6 percent of workers are employed in manufacturing, and only 2.9 percent are employed in construction. The numbers still remain low, even if you add in trade, transportation, and utilities, at 11.7 percent of workers. Compare that to Batltimore County, where the numbers rise to 6.1 percent in construction, 4.5 percent in manufacturing, and 18.2 percent in trade, transportation, and utilities. The numbers in Anne Arundel and Howard Counties are also higher than Baltimore City.
What’s the Solution?
With the number of tax credits given to developers to build luxury apartments downtown, there should be equal attention paid, along with tax credits given to developers to revamp much of our vacant housing stock, especially on the city’s east and west sides, where many low- to moderate-wage workers already live. We also need to incentivize industry — manufacturing, skilled trades and other construction jobs, and utilities. Tax credits for building new facilities, or reusing existing facilities are a must. Better jobs, combined with affordable housing is what’s needed for a stronger, safer city.