Low-income working families increasing: proliferation of low-wage jobs a reason
Posted March 30, 2015 in Selected Press
CLEVELAND, Ohio -- The number of low-income working families has grown since the Great Recession, and their numbers are projected to increase -- especially among minority groups, according to a recent report.
There were 10.1 million low-income working families in 2009, the year the recession ended. (The recession officially began in December 2007 and ended in June 2009.) By 2013, there were 10.6 million low-income working families, according to the report by the Working Poor Families Project, "a national initiative focused on state workforce development policies." The report defines low-income families as those making less than 200 percent above the official poverty level. That meant in 2013, a family of four couldn't have made more than about $47,000.
The bottom line of the report is this: Working a steady job no longer offers a reliable stepping stone to the middle class. The report echoes other research about post-recession job growth in the United States: too few middle-income ones being created, but lots of low-wage jobs. The report listed occupations commonly held by workers in low-income families. Several of these jobs mirrored those that have proliferated during the recovery, including health aides and personal care aides.
African Americans, Native Americans and Latinos were disproportionately represented among low-income families when compared to white and Asian-American families, the report found. African Americans, Native Americans and Latinos comprised 58 percent of all low-income working families, despite making up 40 percent of the total. When the recession began in 2007, there was a 23 percentage-point gap between the share of white and minority families who were low-income, according to the report. By 2013, that gap had increased to 25 percentage points.
The report said the trend is likely to continue.
"As groups at the bottom of the income distribution make up a growing share of the labor force, the total number of low-income working families is projected to increase - even if the economic gaps between the different racial/ethnic groups remain unchanged," the report states.
Amy Hanauer, founding executive director of Policy Matters Ohio, said that effective public policy could increase the chances of more low-income families having a crack at becoming middle-class. She said raising the minimum wage and making it easier for working families to qualify for subsidized childcare are among the things Ohio could do to help the state's low-income working families. The nonprofit was a partner on "Low-Income Working Families: The Racial/Ethnic Divide," meaning that its staff helped with research pertaining to Ohio.
Nearly one-third - 32 percent -- of Ohio's working families are low-income, about the same as in the U.S., the report found. About half - 52 percent - of Ohio working families headed by a minority worker are low-income. Nationally, it is 47.5 percent.
"We are tied with our neighbor, Kentucky, for 29th among the states on this measure and 21 states did worse," Hanauer said.
She said even those who aren't low-income should care about the plight of these working families.
"I think you should care because we want an economy where everyone has a shot at the opportunity for the middle-class lifestyle," Hanauer said. "It matters because it really tears at the fabric of our communities.
"If we want someone to work hard, for example, taking care of our elderly mother, do we want that person to be in poverty?" she said. "If we are looking at the childcare aide in our children's classroom, do we want that person's own children to be growing up with total insecurity? I think the answer is no. I think we want the people who work hard in this state to be able to have some security, have some savings and to get ahead."
Hanauer supports the report's recommendations on the best ways for states to aid in low-income families becoming upwardly mobile. Among them is Medicaid expansion aimed at lessening the burden of health care costs.
"Ohio has really done a great job of expanding Medicaid, and taking that very generous federal allotment and making sure people have health coverage in the state," she said. "I congratulate the governor for his leadership,"
Despite this, she said the state needs to do more to improve the lot of working low-income families. For example, Hanauer said Ohio's cuts to need-base educational financial aid have made it more difficult for low-income parents, and others who want to increase their marketability through education, to do so. She said childcare costs are straining working families; and Ohio makes it "extremely hard" to qualify for subsidized childcare, because families making more than $25,000 a year aren't eligible. Hanauer said raising the state's hourly minimum wage to $10.50 would bring more low-income working families closer to being middle class. Ohio's minimum wage is currently $8.10. A bill introduced in the state legislature would increase it to $10.10.
Gov. John Kasich's Press Secretary Rob Nichols said Ohio has not forgotten low-income families. For example, he said Kasich is proposing allowing families making up to 300 percent of poverty - currently $72,750 for a family of four -- to qualify for childcare subsidies.
"No governor in recent memory has done more to elevate poverty as an issue -- either in the state or nationally --whether it be Medicaid expansion or whether it be the Earned Income Tax Credit," Nichols said. "At the end of the day, the most important thing we can do for the working poor is to commit ourselves to job creation and job training."
He said Ohio's minimum wage is already above the federal minimum of $7.25. A bill that would raise it to $10.10 has been stalled in Congress for a few years.
"Ohio's is higher than the federal, so perhaps the first step should be to talk to the president or talk to Congress," Nichols said.
Original Article: http://www.cleveland.com/business/index.ssf/2015/0...