The rise of homeless workers: A hidden crisis fueled by soaring costs

Homelessness is often portrayed as a plight of society’s most vulnerable, reinforcing damaging stereotypes of addiction, joblessness, and isolation. But a growing, hidden reality challenges these assumptions: many homeless individuals are employed, struggling to survive amidst skyrocketing living costs and stagnant wages. These workers, despite holding jobs, are unable to secure stable housing. Every day, they wake up in cars, motels, or even on the streets before heading to their shifts—earning just enough to scrape by, but never enough to break free.

This new wave of homelessness reveals the intersection of systemic housing shortages, economic disparity, and a workforce grappling with impossible choices. Yes, it’s a housing crisis; but it’s also a crisis of survival for countless workers caught in the crossfire of economic and social inequities.

The cost of living crisis: Why workers are losing their homes

Although no specific data exists for unhoused workers, research highlights the lack of affordable housing as a primary driver of homelessness. The Joint Center for Housing Studies at Harvard University cites post-pandemic rent inflation and stagnating wages as critical factors. Even though rent inflation has cooled slightly, workers living paycheck to paycheck remain dangerously close to losing their housing when rents or utility costs increase.

In 2024, a record-breaking 49.7% of US renters spent over 30% of their income on rent, and that figure ticks up to 50% in some urban areas. Wage growth has lagged behind rent increases in nearly every US city over the last five years. What’s more, the National Low Income Housing Coalition reports there are only 37 affordable and available rentals per 100 extremely low-income renters on average—and in some states, that number drops below 30. The result? A growing population of low-wage workers teetering on the edge of homelessness.

The emotional and physical impact of working while houseless

Imagine waking up in your car to a 7 a.m. alarm after a sleepless night. Anxiety gnawed at you in the cramped seat, and the cold crept into your bones. You head to a local health center, where a $30-per-month membership grants you access to a shower and bathroom. Afterward, a soup kitchen provides a warm, though nutritionally lacking, meal before you begin a 10-hour shift. By lunchtime, the exhaustion from inadequate meals and nights of poor sleep is catching up with you. You make mistakes, worrying that your manager might notice your declining performance. At the end of a long day, all you want is a warm bed.

Maria Foscarinis, Founder of the National Homeless Law Center, explains how everyday challenges become magnified when you don’t have stable housing. “Keeping basic documents, staying clean, washing clothes, not to mention maintaining mental clarity and focus, all of this becomes immeasurably harder without a safe and stable place to live. It’s a daily struggle to keep clean, find a restroom to use, hold on to any remaining property, including critical documents like IDs. Virtually all cities and a growing number of states have laws that make it a crime to live in public, including to live in your own car, and so daily life also involves trying to avoid being arrested or fined, or having your car ticketed, towed, or impounded.”

For many, the goal is to save enough for the first and last month’s rent, but the reality is far more complicated. Motel fees, gym memberships for showers, and extra gas for those living in their cars drain already limited resources. The cycle makes it nearly impossible to move toward stability.

Solutions and support: Addressing the homeless worker crisis

The upcoming Trump presidency is unlikely to turn the tide on this worrying trend. Although he hasn’t shared any big policy plans, in his last presidency he promoted policies criminalizing homelessness and decreasing federal funding. It’s also predicted that he’s likely to ditch the housing-first approach, according to Stephen Metraux, the Director of the Centre for Community Research & Service and Associate Professor at the University of Delaware. The policy, which has been endorsed by the federal government, puts unhoused people into housing as a first step, no matter what the circumstances, and subsequently provides services to help them recover.

Although the Biden administration implemented some measures to ‘end homelessness’—like allocating billions to housing vouchers and increasing affordable housing supply, experts say it was not enough to make up for decades of under-investment. Metraux says that “a conservative administration is more likely to cut back funding for social programming and for housing, and that’s going to impact homelessness directly. Less directly, funding for other related social supports is likely to go down, which will put more people at risk for homelessness. I’m not going to make a prediction, but it’s pretty easy to connect the dots—if less people get less social support, then there’s a good chance that homelessness may increase.”

The role of local governments and businesses

However, not all hope is lost. As homelessness grows as an issue, the ripple effects are felt by more and more influential stakeholders. With people in power feeling the knock-on effects, pressure on local and federal governments to address the issue is increasing. “People who are middle class and who are unlikely to be at risk for homelessness are going to feel the pinch of higher housing costs and more difficulty obtaining housing that they can afford. Even if they aren’t directly at risk for homelessness, they will be starting to see this more as an issue, and it’ll get greater visibility also here in the US,” says Metraux. “What I’m seeing is that businesses, realtors, and others who otherwise wouldn’t take a direct interest in affordable housing, are now doing so because of labor force issues. So that’s forcing politicians to take more of an interest in affordable housing,” he shares. Service-based businesses in seaside resorts and urban centers, for example, face significant labor shortages as workers are priced out of nearby housing.

Massachusetts business leaders say the housing crisis is their number one concern, and it’s posing a real threat to the state’s economy. JD Chesloff, president and CEO of the Massachusetts Business Roundtable, said it’s causing businesses to move elsewhere “Companies have cited the cost of living as the dominant factor in their decisions about expanding and reducing their presence here.” The roundtable met recently with state governors to discuss urgent solutions to the crisis.

What employers can do to help

Employers can play a vital role in supporting workers facing housing insecurity. Creating an environment where employees feel safe disclosing their struggles without fear of judgment is a critical first step. Flexible schedules can allow workers to attend housing appointments or shelter intakes, while workplace storage options for personal belongings can ease logistical burdens.

Employee Assistance Programs (EAPs), like those offered by McDonald’s and Chipotle, connect workers to housing resources, financial counseling, and mental health services. Employers could also consider short-term financial relief, such as emergency housing funds, to help employees transition back into stable housing. Non-judgmental support can make a significant difference in helping employees regain stability.

Building a path forward

The intersection of rising housing costs, wage stagnation, and systemic underinvestment has created a crisis that demands urgent attention. Workers living without stable housing are not just fighting for survival—they’re striving to maintain dignity and contribute to the economy despite insurmountable odds.

To address this growing crisis, a multi-faceted approach is essential. Policymakers must prioritize affordable housing, businesses need to advocate for systemic change, and employers should foster compassionate workplace practices. By addressing these challenges collectively, we can work toward a future where stable housing is a reality for all workers, not just a privilege.

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