Mixed News on Progress Toward Poverty Reduction and Shared Prosperity

November 26, 2012

A year ago, the Half in Ten campaign restarted the clock for cutting poverty in half in 10 years.

As I wrote at the time, it also expanded the goal to include growing a more inclusive and economically secure middle class. It set three top priorities for achieving this — each fleshed out in specific strategies.

Half in Ten established indicators to measure progress (or lack thereof) toward both the poverty reduction and new priority goals.

The first set of figures — mostly 2010 data — were the baseline. Now we’ve got a first year’s worth of updates.

So how are we doing? Not easy to answer within the compass of a blog post.

The full report includes 21 indicators — some new and some reflecting fairly old data because sources either haven’t been updated or lag behind even Half in Ten’s base year.

Half in Ten has a summary of the full set. Also a handful of indicators online.

I’d planned to plow through the online set, using last year’s report for baselines.* But I felt I was losing the forest in the trees. Some of the more interesting indicators too.

A different approach, therefore.

Poverty Reduction

No progress here, as you probably already know. Both the official poverty rate and the somewhat higher rate based on the Census Bureau’s Supplemental Poverty Measure were essentially flat for the two-year period.

Meanwhile, income inequality increased. In 2011, the richest 5% of households got 22.3% of all earnings. The bottom two-fifths got just over half as much — 11.6%.

Good Jobs

Some of the indicators in this group don’t speak to the goodness of jobs, but rather to the issue of whether people have jobs at all.

Generally progress there — except for people with disabilities, whose employment rate dropped from 28.6% to 27%.

More consistent progress on indicators reflecting the employment prospects of young people. For example, the percent of high school freshmen who graduated in four years had increased, as of the 2008-9 school year.

But when we turn to workers in low-wage occupations, we see a partial explanation for the widening income gap.

For full-time workers in service occupations, median annual earnings were just $24,300 — less than $2,000 over the poverty line for a family of four. There’s been no real dollar increase for them since 2000.

Lack of paid sick leave is one — though far from the only — factor depressing yearly earnings for low-wage workers.

In 2011, only 36% of workers earning no more than $11.13 per hour, i.e., slightly below the median or less, had any paid sick leave benefit. This is 4% less than in 2010, suggesting that a lot of not-good jobs got worse.

Strong Families and Communities

Most indicators in this group relate to the current and prospective well-being of children and young adults. And they all moved in the right direction in 2011.

We see, for example, that the teen birth rate continued its downward slide, reaching a record low of 31.3 births for every thousand women in the 15-19 age bracket.

And the percent of people without health insurance dropped from 16.3% to 15.7%. We can credit this to the initial impacts of the Affordable Care Act, Half in Ten says.

Economic Security

End of moderately good news. Only one indicator — food insecurity — remained relatively flat. And even that increased from 14.5% of households in 2010 to 14.9% in 2011.

The percent of jobless workers who received unemployment benefits dropped by 10% to just over half.

Low-wage workers faced a growing affordable housing shortage. In 2010, there were only 58 affordable units available for every 100 very low-income renter households. This is four fewer than in 2009.

No relatively current figures for asset poverty, i.e., less in savings and other cash sources than a family would need to live at or above the poverty line if it had no income stream for three months.

What we know from the indicator is that the percent of asset-poor households increased by 4% between 2006 and 2009, leaving somewhat over 27% of all households at high risk of poverty.

What Will Next Year’s Indicators Show?

Congress has already decided that the unemployment benefits indicator will worsen — unless prospects for long-term job seekers dramatically improve.

It seems on the brink of deciding to let the food insecurity rate rise, since both the House and Senate Farm Bills would cut benefits for half a million households.

But the fate of most indicators — and the people whose lives underlie them — depend on what sort of bargain Republicans and Democrats strike to address the misnamed fiscal cliff.

Half in Ten offers “the right choices” for them — which, of course, are very different from the choices of the right.

* The 2010 figures are supposed to be accessible online. They weren’t when I published this, but I’m told the web tech team is working on a fix.


We Need More Than Just More Jobs

August 28, 2012

“Poverty in America: Why can’t we end it?” Professor Peter Edelman asks. Or maybe the New York Times headline writer asks, since Edelman proceeds to tell us that we can — and how.

Top of the to-do list is to create more jobs that pay decent wages.

Well, how do we do that?

We need a full employment policy, Edelman says. This, I take it, means both public investments and diverse fiscal and labor policy changes that would achieve — and then sustain — a negligible unemployment rate.

We’d have more jobs, but also a relatively small pool of jobless job seekers. Employers would thus have to offer decent wages if they wanted to hire people qualified for the jobs they needed to fill.

Professor Robert Pollin, author of the new Back to Full Employment, says this happened in the 1960s and again in the late 1990s, especially for people “at the low end of the labor market.”

Progressives, Edeleman among them, also call for larger investments in education and skill-development.

Not the answer, according to an analysis by the Center for Economic and Policy Research.

We’ve already got a higher percent of college graduates in the workforce than we did at the end of the 1970s. Yet the share of good jobs, as CEPR defines them,* is smaller — and was even before the recession set in.

The problem, it says, isn’t that workers’ skills haven’t kept up with the pace of technological change — though many allege a “skills mismatch” as the source of our persistently high unemployment rate.

It’s that workers have lost their bargaining power, especially those at the middle of the income scale and below.

Diverse changes in the labor market are responsible for this, e.g., jobs outsourced from the public sector and from local manufacturing to cheap labor markets overseas, a “dysfunctional immigration system” that depresses both wages and other aspects of job quality.

For these and a variety of other reasons, many of the top-growing occupations are in service areas where wages are characteristically low — retail sales, home care, food preparation and other restaurant work, etc.

These jobs obviously can’t be exported. Nor can the people who do them be replaced by machines.

But barring policy changes, they’ll still be low-wage jobs with few or no benefits.

I’m all for improving our public education system and for making it possible for low-income people to go to college — and graduate. We’ve got a long way to go.

But if every working-wage person in the country had a college degree, we’d just have even more college graduates doing work well below their competencies — and effectively pushing out people whose skills match the job requirements.

So we obviously need more good jobs for these current and future college graduates.

But if we’re going to end poverty, we need to make those low-paying service and other proliferating bottom-of-the-barrel jobs better too.

I’ll have more to say about this. In the meantime, Happy Labor Day to you all.

* A “good job” pays at least $18.50 an hour — the 1979 inflation-adjusted median for men. It also offers employer-subsidized¬† health insurance and an employer-sponsored retirement plan. CEPR considers other aspects of job quality important, e.g., paid sick leave, but couldn’t get reliable data to measure changes since the end of the 70s.


How Does DC Rank On Poverty, Opportunity And Shared Prosperity?

November 10, 2011

As I recently wrote, the Half in Ten campaign has issued a groundbreaking report that calls on our nation to do two related things:

  • Cut poverty in half
  • Create shared prosperity by increasing opportunities and supports for low-income individuals and families

For both goals, the timeframe is 10 years — less actually, since the report starts the clock running in 2010. That’s because many of the baseline indicators it uses come from the latest Census Bureau reports.

One of the most ambitious aspects of the project are the state-level indicators for both poverty reduction and progress toward the three big priorities the campaign advocates — more good jobs, stronger families and greater economic security.

The state-level indicators are online and include not only the most current figures, but rankings relative to other states. Links let us see the actual figures for all states.

So what do we learn about poverty, opportunity and shared prosperity in the District of Columbia? Here’s a sample.

Reducing Poverty

About poverty, most of us already know. The District has a higher poverty rate than all but two states — 19.2% in 2010.*

No news about food insecurity either. As I previously wrote, the District’s food insecurity rate last year was 13%. This puts the District above a majority of states, with a ranking of 20.

Creating Good Jobs

The indicators for creating good jobs are a mixed bag indeed.

On the one hand, the District tops all states for wage equity between men and women — an average of only 8.6 cents on the dollar separating them, as compared to 21.4 cents nationwide.

It also ranks first in the percent of young adults (25-34 year olds) with an associates degree or higher. Close to two-thirds — 63.6% — of residents in this age group have a college degree of some sort.

But only one state — Nevada — ranks lower in the percent of high school freshmen who graduate four years later. Barely more than half — 56% — of District students graduated on time in 2008.

Strengthening Families

Huge variations in the indicators for this priority as well.

Only one state — Massachusetts — has a lower percent of residents without health insurance. For D.C., the figure is 7.6% — just 3.2% higher than for Massachusetts.

But no state has as high a rate of children under 18 in foster care. No state, in fact, even comes close.

For every 100,000 children in the District, 2,058 have been taken away from their families. In the highest ranking state — Nebraska — the ratio is 1,188 per 100,000. Nationwide, the ratio is 533 per 100,000.

Promoting Economic Security

No big point spreads here, alas.

Last year, only 36.3% of jobless workers in the District received unemployment insurance benefits, putting the District below all but two states — South Dakota and Virginia.

The District also ranks below all but two states in the percent of residents (adults presumably) who don’t have bank accounts — a somewhat primitive, but useful measure for asset building.

Finally — no surprise — the District ranks lower than all but six states for affordable housing, which is here measured as the number of affordable, available rental units per 100 tenants with incomes at or below 50% of the state median.

Only 53% of lower-income tenants here have a chance at an affordable unit.

Why the Indicators?

Half in Ten provides these indicators — and plans updates — so that we can advocate for legislation that “moves … [them] in the right direction” and hold our elected officials accountable for progress.

The campaign focuses mainly on federal policies. Yet when we look at the District’s indicators, we can see that some of them have solutions close to home.

Many, I think, speak to the yawning gulf between the haves and have-nots in our city.

New evidence of this — and another indicator — from the Census Bureau, which reports greater income inequality in the District than in all but two other major cities.

That’s something our local government can address, though we need radical shifts in federal priorities too.

As at the federal level, the core issue is political will. Creating and sustaining it is our business.

Think what could happen if we all asked our policymakers — and aspiring policymakers — what they intended to do about the deplorable numbers here.

* This figure comes from the American Community Survey. As I earlier wrote, it is more reliable than the much-reported one-year figure from the Census Bureau’s Current Population Survey.


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