Why Working Americans Are Becoming Homeless, High Rent, Low Hope Billions Spent, But US Homelessness Continues to Rise in 2025
- High wages in major US cities are insufficient to cover astronomical housing costs, leading to a large population of employed but homeless individuals.
- A significant portion of the homeless population consists of women fleeing domestic violence and foster youth who have aged out of the system without support.
- Despite billions of dollars in government spending on shelters and subsidies, the homeless population continues to grow due to fierce competition for limited affordable housing.
 |
| Photo by Max Böhme on Unsplash |
America is often viewed as a global superpower, a dominant force with immense economic and political influence. Yet beneath this veneer of power and wealth lies a deep rooted social crisis that mirrors problems faced by developing nations. Homelessness and poverty are urgent issues in the United States and the problem is only getting worse.
A friend of mine recently returned from a trip to Los Angeles and Seattle and was shocked by the sheer number of homeless people living on the streets. This isn't a new phenomenon. Historical records show that homelessness in the English speaking world dates back to the 14th century. By the 16th century, being homeless was actually considered a criminal offense in England because vagrants were seen as a threat to social order. In the 18th century, many of these "undesirables" were shipped off to the American colonies as labor. The first dedicated poorhouse or shelter in New York was established as early as 1734.
The situation escalated during the Industrial Revolution in the 1820s. People flocked to the Northeast looking for work but the job market couldn't keep up with the influx of laborers. Many ended up on the streets and faced arrest simply for having nowhere to sleep. Fast forward to the Great Depression of the 1930s and later the Great Recession of 2008, and the numbers spiked again. In 2008 alone, the US Department of Housing and Urban Development (HUD) estimated there were nearly 1.6 million homeless individuals, with over 66% concentrated in major cities.
Getting an accurate count today is tricky because different organizations use different definitions of homelessness. While HUD estimated around 553,000 homeless people in 2018, advocates argue this number is severely undercounted. The National Center for Homeless Education reported over 1.5 million homeless school children alone in that same year. If there are that many homeless kids, the total number of homeless adults must be significantly higher than the official government figures suggest.
New York City, Los Angeles, and Seattle consistently top the list for homeless populations. The reason is simple economic brutality. While wages in these cities are higher, the cost of living and housing is astronomical. Affordable housing is virtually non existent and minority groups often lack access to government subsidies. In places like Jackson Hole, service workers might earn $20 an hour—a fortune in many parts of the world—but they still live in their cars because rent is impossibly high. Being homeless in America doesn't necessarily mean you are unemployed. It often means you are a working person who simply cannot afford a roof over your head.
Mental health issues and substance abuse are often cited as causes, but the relationship is complex. Sometimes mental illness leads to homelessness, but often the trauma of losing one's home triggers the illness. About 25% of the homeless population suffers from severe mental health conditions like schizophrenia or bipolar disorder. Women are disproportionately affected, with 75% of homeless women struggling with mental health issues. Many of these women are fleeing domestic violence and abuse, choosing the streets over a dangerous home environment.
The youth homeless population is another tragic demographic. A significant number are former foster care children who "aged out" of the system at 18. Without family support, life skills, or a place to go, about 65% of these emancipated youth end up on the streets. They are thrown into adulthood with zero safety net.
Homelessness also exposes people to extreme violence. Hate crimes against the homeless are alarmingly common, with hundreds of murders reported over the years. Many victims never report abuse to the authorities because they feel ignored or marginalized by society.
It is important to understand that "homeless" doesn't always mean sleeping on a sidewalk. Many live in shelters or vehicles. They go to work during the day and park their cars in designated lots at night to sleep. Some of these lots even provide basic amenities like bathrooms and communal kitchens. These are functioning members of society who have been priced out of the American Dream.
The government has spent billions trying to fix this. California alone allocated $13 billion between 2018 and 2020 for subsidized housing and "Housing First" initiatives. Yet the numbers keep climbing. In 2020, there were about 580,000 homeless people, and by 2022, that number rose to 582,000. As long as housing demand outstrips supply and prices continue to soar, subsidies will never be enough to cover everyone in need.
The future looks uncertain. With global economic shifts and challenges to the US dollar potentially on the horizon, the domestic economy could face further strain. Whether the homelessness crisis will be solved or spiral further out of control remains a critical question for the nation.