financial stressLast week, RJ shared a thoughtful post about the concept of “paid vacations” and how they affect (more like DON’T affect) the working poor.  “Paid” vacation isn’t a given for many workers in our country. And any time off work for “fun” is a luxury that most can’t afford.

Before I begin an article focusing on the plight of the working poor, it should be stated that I am economically privileged, and although I am trying to highlight reasons our country and our corporations are not doing enough to help the working poor achieve a higher standard of living, I know I can’t completely empathize with how things are for people in this demographic and I can’t even begin to know some of the challenges they face on a daily basis.

Poor is Relative

I was “poor” in college and early adulthood, but even when I was, I saw it as a stage or a place I would get through once I had a degree and a job.  I didn’t grow up poor, and while we certainly weren’t rich, we always had what we needed. My privilege made me think being “poor” as a young adult was just some phase I was supposed to learn from, conquer, and move past. And when things were “tough”, I either used my Visa or called Mom or Dad for help.  I was never truly poor.  I had a car, paid rent, bought clothes, had plenty to eat, always had electricity, had insurance, went out to eat, and saw cable TV as a necessity.

The cost of living in America has risen steadily over the years, and while inflation grows, there are a million pieces of evidence showing us that wages for low-skilled and service industry workers have NOT kept up; they’ve basically flatlined.  “Cost of living” increases have become a joke, and it’s not uncommon for people who are considered “working poor” to have two or even three jobs just to cover basics.  Often “the basics” do not include car payments, decent health care, vacations, furniture, or even clothing, though those things are basics to most people in the middle and upper economic classes.

Do the Math: Could YOU Make It Work?

Working Poor Struggling Mother and DaughterLet’s say we have a family of four, with two parents each working forty hours a week. This is already a stretch, as many places of employment won’t give a full forty hours to avoid having to pay benefits or accidentally have an employee earn overtime pay. This family lives in a larger city like Denver, where the minimum wage is currently $10.20/hour. The parents hold high school diplomas, and maybe even an associate’s or technical degree, but they can’t find work in their field(s). They are getting by in a restaurant or retail establishment, or maybe doing home health care or some other type of service work. Wherever they work, there is slim to no chance they have a job that is unionized and as a result, they have to accept their pay and working conditions if they want to remain employed. They are at the mercy of the owner or corporation who often does not return a fair share of the profits to the workers who make or break a business. Bargaining is out of the question.Divide between the rich and poor

This couple’s gross weekly pay is $816 and take home is closer to $650 (if that), after taxes. And since it’s pretty obvious they aren’t going on any fancy vacations, let’s assume they work  52 weeks a year each and never miss work because of illness, family emergencies, or any other reason. Their annual combined gross income in that “perfect” scenario is about $42k.  

Since this couple has children, they either need to be working opposite shifts, or paying someone for childcare (or leaving the children home alone or with a really nice relative or friend who will watch them for free-good luck!). They are likely renting or have a mortgage on a VERY small home in a city that has seen skyrocketing housing costs. After paying for housing, they must pay for other necessities like food, clothing, medical needs, and transportation. Before you ask yourself, “Can’t they at least get food stamps or something?”, the answer is NO. This family would need to make $10,000 less to qualify for Colorado’s SNAP program.

No Room in the Budget

There is no money left in the budget for fun things like activities, lessons, gym memberships, computers, bicycles, visits to restaurants; things that most of us take for granted as everyday activities. This family has to hope they have established some good credit somewhere along the line, because there may be times they’ll need to tap it just to get by. They may have to get payday loans, wait patiently for tax refunds, or celebrate Christmas two months late because that’s when there is money for gifts. They may pick up second and third jobs to make life happen (they probably have to). This life would be tough (understatement) on the whole family….and it’s not unique at all.

Colorado, like a number of American cities and/or states, is in the midst of a sizable (though I’d use that term loosely) increase to their minimum wage. In 2016 it was $8.41; in 2017 it rose to $9.30. It’s $10.20 now and will hit $12 by 2020. Percentage-wise, those seem like generous increases, and yes, it is a start, but in a system that is so very far behind, it’s probably too little too late. According to this Denver Post article,

workers earning the minimum wage or just above it say the increase has made a difference in their lives. But they also question whether the ask was too modest given how much housing costs continue to rise.”  

image of wealthy neighborhood versus poorThe article goes on to discuss the fact that nearly 25% of Denver renters pay 50% of their income to rent. HALF of the money they make. How in the world would a person or family ever even think or dare to dream about getting ahead in this situation, or buying new furniture, learning to play an instrument, going to camp, or taking a trip?

The High Cost of Working More

Do you pick up a second job?  A third? Never spend time with your partner or children?  Never take a day off? Not buy healthy (aka more expensive) food? NOT visit the doctor if you’re sick? Only rely on public transportation and never leave the city?  Yeah, I suppose any of those things could work….if all you do is work.

Unless the minimum wage increase is over and beyond the rising cost of living, the working poor will remain trapped in the lower class. This is one more reason underpaid workers need a voice, need people who care and listen, and will work to help equalize the playing field. This “pretend” family in Colorado is very real, and there are many of them. Is it remotely fair that they live in the richest country on earth and work full time yet can’t even consider the American dream?

Concept, american flag on cracked background

Working Poor – No End in Sight

If inflation continues to outpace wage growth, if housing prices continue to skyrocket (especially in urban areas), and if our minimum wage “hikes” are nothing but band-aids, how can the working poor ever hope to escape the cycle? Unless people never sleep, never have one bit of fun, and work 20 hour days, no one is ever going to be able to pull themselves “up by the bootstraps” and achieve the “American Dream” we’ve been taught to believe in; the American dream that those at the top don’t seem to think we deserve a chance to attain through hard work and perseverance. 

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