Poverty as a math problem: Available jobs and incomes don’t add up to living wages

Editor’s Note: This is the third column in a six-part series under the theme “Poverty is a math problem (and so much more).” 

In the spring of 2012, the Chronicle of Higher Education published a special section titled “From Graduate School to Welfare.” Among the essays in this section was “The Ph.D. Now Comes with Food Stamps,” which revealed that in recent years the number of Americans with advanced academic degrees receiving federal aid of some kind had increased by approximately 300 percent.

A few years later, in the midst of America’s supposed economic recovery from the financial crisis of 2007 to 2009, came a report from the Federal Reserve Bank of St. Louis regarding the Civilian Labor Force Participation Rate. The report estimated that as many as seven million displaced, middle-income American workers had essentially dropped out of the job market altogether, unable to find work at or near their previous wage. This trend helped to bring the Labor Force Participation rate to its lowest point in nearly 40 years.

Now, if those with educations valued at several hundred thousand dollars along with millions of middle-class workers cannot find suitable employment, what does that mean for working-class and impoverished households? There is no question that globalization, automation, and technological advancement have made an indelible impact on American economy in the last half century.

There was a time when — in places such as Detroit, Flint, Gary, South Bend, Cleveland, Youngstown, Pittsburgh, Buffalo, and other rust belt cities — one didn’t need a world-class education to make a good living. Of course, that time is long gone, and one of the central debates today between economists, scholars, policymakers and other analysts comes down to a basic math problem perhaps best articulated by the Wall Street Journal’s Annie Louie Sussman, who asks, “What if there just aren’t enough jobs to go around?”

In July 2009, at the peak of the Great Recession, the Bureau of Labor Statistics (BLS) reported that there were nearly seven unemployed job seekers for every available job opening in this country. While that ratio has decreased significantly in the past eight years, there are still more job seekers than jobs in America.

Of equal significance is how many of the jobs out there can be considered good jobs. The Bloomington-based Gallup Organization’s “good jobs rate” for July 2017 was 47 percent. This means that less than one-half of those currently employed in this country are working a minimum of 30 hours per week.

That is why the BLS’s job reports that consistently seem to reveal the creation of an additional 150,000 to 200,000 or so jobs each month rings hollow to many Americans, as study after study shows that most of these jobs are low-wage, part-time, seasonal and temporary positions.

Some might have the audacity to ask, “Why does that matter? A job is a job and you should take whatever you can get.” Well, a great number of Americans are taking whatever they can get. Still, that is not enough. In fact, it is far from enough.

Consider some of the recent data from the Minnesota Housing Partnership’s 2017 “State of the State’s Housing” report. For example, a renter must earn a wage of roughly $19 per hour in order to afford a fair market rate two-bedroom apartment in Minnesota. Moreover, a full-time employee who makes minimum wage is unable to afford a modest one-bedroom apartment in a single one of the state’s 87 counties.

When you add the fact that in the last 15 years the median income of renter households in Minnesota has fallen by more than 10 percent, while rents have risen by the same margin, it appears that we have a math problem.

People don’t want to be poor. They want good housing, access to quality education, suitable transportation, and of course living wage employment. The fact is that in America today there are not enough jobs for everyone. And of the jobs that do exist, far too many of them are inadequate. Yes, we have a math problem.

 

Clarence Hightower is the Executive Director of Community Action Partnership of Ramsey & Washington Counties. Dr. Hightower holds a Ph.D. in urban higher education from Jackson State University. He welcomes reader responses to 450 Syndicate Street North, St. Paul, MN 55104

 

Pullquote: “What if there just aren’t enough jobs to go around?”

 

Insert: unemployment line?

 

 

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