Imagine working 83 hours a week just to pay the rent? Well, that's the reality for a typical retail worker just to afford an apartment based on current rent structures, according to a new study by Redfin.
In practice nationwide, the typical retail worker earns $34,436 a year – less than half the $71,172 they would need to afford the typical apartment rent of $1,779 a month. As a result, typical retail workers are unlikely to seek out the typical apartment, which would be outside their budget. Indeed, one in four (23%) struggles to make rent each month, a key factor in tenants’ decisions to move.
The term “retail worker” includes cashiers, salespersons, and first-line retail supervisors. Even the highest paid in this group, with wages in the top 25%, would find it difficult to afford the typical apartment, as their income would still fall 44.2% short of the monthly rent required.
And they appear to be headed toward an even more difficult few months ahead as retailers continue to downsize. The report cites data from Challenger, Gray and Christmas stating that layoffs this year have spiked 145% to 88,664 jobs from 2024 levels. Projected seasonal hiring offers little cheer. It is expected to slump to its lowest level in 15 years, plunging from 442,000 in 2024 to somewhere between 265,000 - 365,000 this year.
The silver lining to this gloomy picture is that affordability has improved a little in recent years, according to the report. Even though the typical retail worker earns 51.6% less than needed to afford the typical apartment, that is better than the 52.2% shortfall in October 2024 and the 56.8% level in October 2022.
The improvement is due to the fact that wages have been growing by 3% a year, faster than the 2% rate rents have maintained. Rent growth has been slowed by the boom in apartment construction and higher vacancy rates that drove landlords to pull back on rent increases.
The metros where the differences between retail wages and apartment rents are smallest include Cleveland (32.9% of rent for the typical apartment), St. Louis (34.6%), San Antonio (35.2%), Kansas City, MO (37.1%) and Milwaukee (37.5%).
Metros where retail workers are least likely to be able to afford the typical apartment include New York (rent is 71% of wages for the typical apartment), Boston (66.5%), San Jose (65.7%), Miami (65.2%) and San Diego (64.6%).
“As the cost of living has increased, so have the sacrifices renters must make to afford a place to live,” noted Redfin chief economist Daryl Fairweather. Those sacrifices include sharing space, moving, or living in a very small space.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.