What is the difference between a minimum wage and a living wage?

The difference between a minimum wage and a living wage is that the minimum wage is the least amount an employer is legally obligated to pay an employee for work, while a living wage is an amount that is considered sufficient to cover the basic needs of the employee and their family. In New Mexico, the minimum wage is currently set at $9.00 per hour, which is higher than the federal minimum wage of $7.25. It is likely to increase in the near future, as the state government works to raise it to $12.00 per hour by 2021. A living wage, however, is not fixed. It is an amount calculated based on the cost of living in the specific area and changes depending on the different expenses of the household. It includes much more than just wages; it must cover housing, medical costs, food, transportation, and other necessary expenses. The Bureau of Business and Economic Research at the University of New Mexico recently estimated that the living wage for a single adult is $11.30 per hour in the city of Albuquerque. This is more than the minimum wage, but it serves as a benchmark of what is needed for an individual to make ends meet. Overall, in New Mexico, the minimum wage is set at a level that is slightly higher than the federal one, but still does not provide a living wage for most people. It is important to note that while it is necessary to have a minimum wage that provides a basic level of financial security, it is important to understand that a living wage is required for workers to be able to cover their basic expenses.

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What is the difference between a minimum wage and a living wage?

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