Number of working poor families growing in America

July 13, 2005

Although the War on Poverty was declared in the 1960s, a poor family today in 2005 is much worse off than the average poor family in the 1960s, because official poverty measures have failed to keep up with changing basic needs, according to a new report.

"An Atlas of Poverty in America: One Nation Pulling Apart, 1960-2003" has just been published by a team of Penn State researchers. The project was funded by the Ford Foundation. An expanded version of the atlas, with updated and new sections, will be published by Routledge this fall.

"America has become a nation of people where all able persons who can work, do, but many can not make ends meet," says Dr. Amy Glasmeier, lead author and the E. Willard Miller Professor of Economic Geography at Penn State. "America is not currently doing all it can to assist working families, those who are discriminated against in the labor market, and the disabled, to make ends meet. "Current U.S. poverty rates may underestimate poverty among the working poor," she adds. "Being poor in 1960 meant getting by on less than $3,553 for a family of four a year. Families were not expected to own a car or have a bed for each family member, and nothing was budgeted for medical care or insurance. "

Today, official guidelines still assume that families spend about one-third of their income on food, but food spending has dropped to one-sixth, with a larger share of expenses being taken up by housing, utilities and transportation. If health care and childcare expenses are included as necessities, the minimum level of income need by a family of four is much higher.

Over the last 30 years, the number of jobs that do not pay a living wage has increased dramatically. In the U.S., as many as 25 percent of all jobs pay less than a poverty-level income, the report says. In some states, as many as 30 percent do not pay a living wage.

A living wage takes into account differences in the cost of living across areas of the U.S. In many communities, the national minimum wage of $5.15 per hour provides an income insufficient to support individuals or families, the report says.

The research project's web site provides a living wage calculator, which shows the amount of income needed to support individuals, and families of two and four persons. The tool illustrates the types of jobs that do and do not pay living wages for communities around the country

"Of the more than 35 million persons classified as living in poverty, most are children, disabled or elderly," Glasmeier notes. "But 7 million of them are men and women who are working at jobs that do not pay a wage they can live on. A majority of working poor are over age 24 and in their wage-earning period of life."

The working poor are found in every state, according to the report. In 17 states, the majority of working poor totals more than 50 percent of the working age population. Such states are concentrated in the Farm Belt, where economic decline has been ongoing for the last 20 years, and in the West, where population growth has helped keep wages low, say the researchers.

"Working poor families with children are even more concentrated in the South, Southwest and the western Plain states," Glasmeier says.

The Atlas maps the effect of poverty by regions (Appalachia, the Mississippi Delta, Native American nations, and the Border region); and by specific populations (children, women, elderly, Black families) through charts, maps and tables. It also outlines the history of poverty and American poverty policy from the 1930s to 2004.

"Certainly, progress has been made over the intervening 40 years in terms of an overall minimum standard of living as measured by material conditions," the researchers write. "In the last 40 years, the largest positive change occurred for the poor elderly. In 1959, 35.2 percent lived below the poverty line; today, it is 10 percent. A combination of programs i.e. Social Security and Medicare has been one of the main reasons. Still, more than 40 percent of elderly persons live on incomes only twice the national poverty level, which is approximately $18,000 a year."

Looming trade deficits, growing disparity in the availability of good jobs, reduced returns to investments in education, and the loss of labor-intensive manufacturing jobs in America's low-wage region raise serious questions. Individuals and families at greatest risk for poverty today are men with less than a college education, people of color (especially Blacks and Hispanics), working families and families headed by women, and a significant number of the nation's elderly who live at or close to the poverty line, the report says.

"The problem of persistent poverty is a complex one that includes communities and individuals, who through no fault of their own, find themselves unable to make ends meet in this globalizing, information-intensive world," the researchers say. "We are a more diverse population and a more dispersed population. If anything, the gap between the economically secure and the poor is more severe than it was four decades ago. In many families today, children cannot say they expect to be better off than their parents. This is perhaps the greatest challenge now facing our society."
An abbreviated version of Atlas of Poverty is available by contacting Debra Lambert, Earth and Environmental Systems Institute, 2217 Earth & Engineering Science Bldg., University Park, PA 16802, or by phone at 814-863-7091.

Penn State

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