logo

Up to 20% of Americans Live in Poverty, Statistics Reveal

image
Author: B
Created: 04 March, 2014
Updated: 14 October, 2022
3 min read
A lot of conversation has occurred about the minimum wage -- or livable wage movement -- popularized by a recent victory in Seatac, Washington, which spread across the state and has now gained the attention of President Obama.

Across the country, employees are striking, picketing, and staging walkouts, protesting low wages and poor working conditions. Walmart, in particular, provides associates a directory to help them locate their local medicaid office. Further, Jon Lehman, a former 17-year veteran Walmart manager, disclosed to PBS that he was instructed by Walmart Corporate how to direct his employees to apply for charity, community assistance, and state-provided welfare.

Federal poverty guidelines, provided by the U.S. DHHS, Office for the Assistant Secretary for Planning and Evaluation, are used by programs to determine eligibility for financial assistance. For a single person living in the continental United States (Excluding Alaska and Hawaii), the poverty level is $11,490 a year. This amount represents approximately 7.3 months of gross income working full-time at $9 per hour. A month of employment -- for purposes of this article -- being defined as 173 hours of work.

After tax deductions, and before receiving a tax return, the net income (or take home pay) is actually somewhere between 8 and 9 months of work, based on a single individual claiming zero or one on their withholding statement.

For a family of four, the poverty line is $23,550.

It would be useful to have some sort of realistic measurement of necessary costs associated with maintaining a household at a reasonable level, rather than the poverty level alone. Fortunately, the IRS has adopted

collection and financial standards which define what it considers to be necessary living expenses.

For 2013, in King County, Washington, the IRS states that necessary housing and utility costs for a single person are capped at $2,106 per month with food, clothing, and other necessary expenses being capped at $583 per month. In addition, out-of-pocket health care is capped at $60 per month for a person under age 65.

It’s math time again.

To be able to be able to pay just the IRS defined necessary living expenses in King County, Washington, this single person would need to earn $2,749.00 a month ($2106+$583+$60=$2,749) minimum. This amounts to $15.89 per hour. After considering tax deductions on gross income, the necessary hourly wage is higher.

These expenses do not include car payments or costs associated with keeping necessary career skills up to date, such as college or technical education.

IVP Existence Banner

These numbers, to me, represent a reasonable livable wage for a single person.

The Alliance for a Just Society recently published a report called the 15th Annual Job Gap Study. The study’s findings included the following:

  • A single person needed to earn $16.04 per hour to pay for necessary living expenses.
  • There are 7 job seekers for every open job that pays a livable wage being defined at $15 per hour or higher.

Not earning a livable wage is unsustainable.

If the 39 percent of employers above continue to not pay a livable wage to their employees, they are going to contribute to a potential social services disaster. By some statistics, between 16 to 20 percent of Americans now live in poverty.

However, I believe if employees start earning a livable wage, it will strengthen the economy -- locally and nationally -- by virtue of these additional funds being used to consume goods and services. This will create increased revenues for both the public and private sector.

Employers are starting to wake up. Costco figured this out some time ago. They pay a livable wage and are not only profitable, but remain competitive. Henry Ford, the automaker, figured this out a long time ago: he paid his employees enough so they could afford to purchase his cars.

Photo Credit: spirit of america / Shutterstock.com

Latest articles

votes
Wyoming Purges Nearly 30% of Its Voters from Registration Rolls
It is not uncommon for a state to clean out its voter rolls every couple of years -- especially to r...
27 March, 2024
-
1 min read
ballot box
The Next Big Win in Better Election Reform Could Come Where Voters Least Expect
Idaho isn't a state that gets much attention when people talk about politics in the US. However, this could change in 2024 if Idahoans for Open Primaries and their allies are successful with their proposed initiative....
21 March, 2024
-
3 min read
Courts
Why Do We Accept Partisanship in Judicial Elections?
The AP headline reads, "Ohio primary: Open seat on state supreme court could flip partisan control." This immediately should raise a red flag for voters, and not because of who may benefit but over a question too often ignored....
19 March, 2024
-
9 min read
Nick Troiano
Virtual Discussion: The Primary Solution with Unite America's Nick Troiano
In the latest virtual discussion from Open Primaries, the group's president, John Opdycke, sat down ...
19 March, 2024
-
1 min read
Sinema
Sinema's Exit Could Be Bad News for Democrats -- Here's Why
To many, the 2024 presidential primary has been like the movie Titanic - overly long and ending in a disaster we all saw coming from the start. After months of campaigning and five televised primary debates, Americans are now faced with a rematch between two candidates polling shows a majority of them didn’t want....
19 March, 2024
-
7 min read