Note: In our recent Real Cost Measure announcement, United Ways of California included statewide housing cost data that require clarification. We originally stated that 57% of California households spend 30% or more of their income on rent or mortgages. The correct figures are: 40% (over 4.5 million) of all California households spend 30% or more of their income on rent or mortgages. When examining households under the Real Cost Measure, the rate of housing-burdened households jumps to 57% (about 2.2 million).

FOR IMMEDIATE RELEASE

CONTACT:
Rekha Radhakrishnan
rekha@unitedwaysca.org
832-628-2312

Three Full-Time Jobs: The New Normal in California

To meet basic needs, families must earn the equivalent of three full-time minimum wage incomes, new United Ways of California study finds

SOUTH PASADENA, CA — More than one in three Californian households (35% or 3.8 million households) cannot afford to meet the cost of a decent standard of living according to United Ways of California’s latest Real Cost Measure study, a tally of basic needs that goes beyond the federal poverty line to reflect the actual cost of living, including food, housing, transportation, child care, out-of-pocket health expenses and taxes.

“While there have been bright spots such as increases in the minimum wage and reduction in the unemployment rate, plus temporary subsidies during the COVID pandemic, we still see too many working families falling below the Real Cost Measure,” said Pete Manzo, president and CEO of United Ways of California. “We are seeing families forced into impossible choices, like forgoing adequate child care, delaying health treatments or going hungry. California leaders must pursue policies that will make a difference for working families, starting with expanding tax credits, improving Californians’ access to income support programs and increasing support for renters.”

In the last decade, the Real Cost Measure analysis has found that the overall percentage of California households unable to meet basic needs has remained stagnant, despite the amount of wealth generated in the state. While housing continues to be a key driver of cost, with 40% or 4.5 million Californian households spending 30% or more of their income on rent or mortgages, raising children is another crucial factor, increasing a household budget in Sacramento with two children, for example, by nearly 80%.

Latino and white working households represent the largest set of impacted communities, with 1.8 million Latino households and 1.2 million white households earning below the Real Cost Measure. Single parent women-led households face an especially difficult challenge with 62% of full-time working single mothers running households that don’t meet the Real Cost Measure. Immigrant households also experience a drop off in income with 58% of households led by someone born outside the U.S. living below the Real Cost Measure.

“Even with two incomes, living in California is so expensive. I think the biggest challenge that I’ve seen in our community has been cost of living—rent, housing,” said Ivonne Sonato-Vega, a mom of five living and working in Sonoma County. “It’s hard especially with gas and grocery prices going up. We’re so lucky that my parents are able to take care of our kids while my husband and I are at work. If we had to pay for child care, it would cost more than I earn, and I wouldn’t be able to work.”

The 2025 Real Cost Measure study also finds:

• The rate of struggling households goes down as education levels increase.
  Nearly three in five (69%) working households led by a person without a high school diploma earn below the Real Cost Measure, compared to only 18% for those with a bachelor’s degree or higher.
• Most struggling households in California are Latino or white, but Latino and Black households struggle at a higher/disproportionate rate. 51% of Latino-led households and 43% of Black-led households have incomes below the Real Cost Measure, compared to 39% of Indigenous-led households, 30% of Asian-American-led households, and 23% of white-led households.
• Households with young children struggle the most; 54% of households with children under age 6—and 81% of households led by single mothers with kids under 6—fall below the Real Cost Measure.
• Location matters—82% of households in the neighborhood cluster of Central LA City/East Vernon in Los Angeles County fall below the Real Cost Measure, compared to 11% of households in the San Ramon/Danville neighborhood cluster in Contra Costa County, for example.

This study is coming out in advance of the Governor’s May Budget Revision and as state lawmakers, anticipating potentially devastating cuts to Medicaid (Medi-Cal), CalFresh (SNAP) and other federal support for working families, consider proposals around housing, tax credits and other solutions to help alleviate key household economic pressures.  

About the study:
Demographic findings from The Real Cost Measure in California 2025 are calculated from the U.S. Census Bureau’s 2023 American Community Survey, the latest available as of this release, and historical data is available from 2014 through 2019. The study’s website provides data findings for each of California’s 58 counties, down to the neighborhood level, interactive maps and an interactive calculator that shows how much a household in any county needs to earn to make ends meet. To learn more, visit unitedwaysca.org/realcost.

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United Way mobilizes communities to action so all can thrive. United Ways of California works in partnership with California’s local United Ways to implement community impact programs and advocate for policies that ensure every Californian has the resources and opportunities they need to thrive. From strengthening local resilience to advancing health, youth opportunity, and financial security, we take a comprehensive approach, listening and responding to Californians’ needs, and center equity in everything we do. Our statewide network of local United Ways across California allows us to share innovations and scale impact to improve lives across the state. To learn more, visit unitedwaysca.org.