Report Shows That More Than One Million New Yorkers Are Poor Despite Work

March 8, 1999. Highlights of a report released today are given in this press release:

According to a new report issued today by the Fiscal Policy Institute, New York State’s economy is not working for low-income working families. The new study, Working but Poor in New York: Improving the Economic Situation of a Hard-Working but Ignored Population, found that more than one million New Yorkers live below the poverty level despite the fact that they are members of households with at least one worker. Even more shocking is the finding that more than a third of the state’s poor families with children were poor despite having a parent who worked full-time, year-round.

The poverty rate of these families is not high because of low or reduced work effort. While nationwide the poverty rate of poor working families with children grew by 13% between the late-1980s and the mid-1990s, in New York the poverty rate for such families increased at four times that rate or 52%. In the mid-1990s, one quarter of a million New York families with children were poor despite work. This was an increase of 115,000 since the late-1970s.

  • In more than half (52%) of all poor families with children at least one person worked.
  • More than one half million (531,000) children, or 39% of all poor children, lived in a family with at least one worker.

The workers in New York’s poor families were much more than casual participants in the labor force. The report shows that the individuals in these families worked most months of the year and that those who worked less than full-time, year-round would have preferred to work more. The facts are:

  • More than a third (36.9%) of New York’s working poor families with children had at least one worker who worked full-time year-round.
  • Another 45.6% of such families had workers who worked less than full-time, year-round for economic reasons beyond their control.
  • On average, workers in working poor families with children worked 39 weeks per year.

The demographics of New York’s working poor defy common stereotypes. The working poor are not all young, poorly educated, single parents who do not have the skills to make a decent living. In fact, only a minority of working poor families fit that description.

  • Only 46.4% of working poor families were headed by single parents.
  • 38.2% of working poor families were headed by non-Hispanic Whites.
  • 65.2% of family heads had at least a high school education.
  • 68.7% of family heads were in their prime working years, 25 to 44.

In addition to painting a picture of working poor families in New York and describing how the situation has changed over time, this report also outlines the factors that contribute to the problem of poverty despite work and discusses specific positive strategies design to make work pay. The report’s recommendations include:

  • Raising the minimum wage and indexing it to inflation,
  • Requiring firms that receive public contracts or public subsidies to pay their employees a living wage,
  • Making welfare reform work better by increasing the portion of earnings that a family can keep as it moves from welfare to work, establishing transitional employment programs, and making affordable transportation alternatives more readily available,
  • Making the unemployment insurance system a more effective safety net for low wage workers, expanding New York’s temporary disability insurance program to cover leaves taken under the federal Family and Medical Leave Act,
  • Expanding the federal and state Earned Income Tax Credits and the new federal child credit to ensure that working families do not live in poverty,
  • Increasing access to quality health care, particularly for low-income adults, and
  • Improving the availability of affordable and reliable child care.
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