Study: 39 million Americans in working poor families

Genaro C. Armas

Tuesday, Oct. 12, 2004 | 9:16 a.m.

WASHINGTON -- One in every five U.S. jobs pays less than a poverty-level wage for a family of four, according to a study by the nonpartisan Working Poor Families Project.

The result of so many low-paying jobs is that nearly 39 million Americans, including 20 million children, are members of "low-income working families" -- with barely enough money to cover basic needs such as housing, groceries and child care, the study found.

The study classified a "working family" as one in which there was one or more children and at least one family member had a job or was actively seeking work.

Besides staying current on bills, many of these folks also struggled to save up for a bigger home or for a child's college education, said Brandon Roberts, one of the report's authors.

"These 20 million children are the future of our workforce," Roberts said. "Their future economic abilities are at risk growing up in families that don't have the resources to support them."

The report said federal and state lawmakers should put more money into adult education and job training programs, increase the minimum wage and expand subsidized child care for low-income parents. Doing so would create more skilled workers who will make more money and, in turn, increase the tax base, the study said.

"We do not think that the current federal-state system designed to support these families is sufficient for the task," Roberts said.

The report is based on Census Bureau data from 2002 and was to be officially released today, the day before the third and final debate between President Bush and Democratic challenger John Kerry. That debate will focus on domestic issues, with an emphasis on jobs and the economy.

The government's poverty threshold varies depending the size of a family. For instance, a family of four with two children was considered impoverished if its income was less than $18,244 in 2002.

The study, sponsored by the Annie E. Casey, Ford and Rockefeller foundations, looked at working families with kids that earned no more than twice the poverty level. Anyone below that level was considered "low-income."

For a family of four, that threshold was $36,488. The median U.S. income for such families is $62,732.

About 28 million jobs in the United States provided less than a poverty-level wage, which works out to about $8.84 an hour for a family of four, the study said. The median wage for a waiter was about $6.80 an hour; for a cashier it was $7.41 an hour.

That points to the need for the federal minimum wage to be raised from its current $5.15 an hour to ensure those in such positions can support their families, researchers said.

Besides child care, the report also suggested expansion of the federal earned income tax credit, as well as more incentives for states to offer similar refundable tax credits for such families.

The report also called on states to improve educational opportunities, such as adult education and literacy programs, for low-income workers who want to move on to higher-paying jobs.

Sheri Steisel, director of human services policy at the National Conference of State Legislatures, commended the study but said state lawmakers are hamstrung by tight budgets.

"It's not a lack of interest in the topic, but it's a question of financing," she said. "States have had to struggle on where to put their limited dollars."

The study urged federal and state lawmakers to work more closely to evaluate government policies and make better use of limited funding.

"Obviously under the current (economic) circumstances, that's going to be a very contentious issue, but we would suggest that it's a high priority issue," Roberts said.