Written by Selma Tucker and Alex Kontras
Housing Kent has launched a Housing Affordability Index and Data Dashboard that details key performance indicators (KPI) on housing outcomes in Kent County. The dashboard adds a new chapter in the housing story with discussions on homeownership affordability, rental affordability, and homelessness. The dashboard speaks to why the American Dream feels—and is—less attainable than ever. And a big part of that story for residents is about the growth of housing costs versus how much they make.
It will surprise no one that lives here that the price of an entry-level home in Kent County has risen 126% in the last seven years. Compare that with the 26% increase in the median annual wage over the same time period, and we can see why the American Dream is getting further away from the typical Kent County resident.
How have residents been keeping up with these skyrocketing housing costs when their wages have barely budged? To answer this question, we must understand the relationship between household income, wages, and the industriousness of Kent County residents.
Let’s start with wages: the median wage measures the value of a single unit of labor. Tracked by the Bureau of Labor Statistics, it estimates what the typical laborer earns on an hourly basis. To calculate an annual figure, the median hourly wage is multiplied by 2,080 hours (the number of annual work-hours in a standard job). For most people, this is their base salary or cumulative earnings for working full-time.
Median household income, on the other hand, measures something different. Often called area median income (AMI), this figure is how much money the typical household brings home in a year and includes more than just wages. Household income includes earnings from multiple workers under the same roof, as well as side hustles, overtime, retirement distributions, and even public benefits. Household income has grown quicker than wages—by 64% since 2010. Over the same period, wages grew on
ly 29%
How can household income rise faster than wages? While there are many reasons, one significant factor is residents are simply working more hours at multiple jobs and asking more members of the household, like stay-at-home parents and seniors, to work too. The chart below illustrates this point.
More Kent County residents are working—and more are working longer hours— because wages are not growing in line with the cost of living. Consider the fact that a growing share of the working age population works: 83% in 2022 compared with 76% in 2010. Of those who work, 61% work full time as opposed to part time, up from 49% in 2010.
These massive shifts in our local economy are an important thread in the story of housing affordability. Housing Kent’s assessment of housing affordability digs into both household income and wages. The latter has been ignored far too long. Analyzing this problem from the perspective of the resident’s experience and system performance reveals just how hard working and scrappy our residents are in the face of out-of-control housing expenses.
There is no room for myths about laziness or handouts here; those narratives simply are not corroborated in the data. Community leaders in partnership with residents must focus on solutions that bring the American Dream back into reach for typical Kent County workers. That will require creative and bold solutions that honor the resourcefulness of Kent County families, rather than take it for granted. Housing Kent’s dashboard expands the conversation on the problem of housing affordability and the forthcoming State of Housing Report will discuss possible solutions.
