7/7/98

Contacts:
Cynthia Needles Fletcher, Human Development and Family Studies, (515) 294-8521
Terry Besser, Sociology, (515) 294-6508
Brian Meyer, Agriculture Information, (515) 294-0706

ISU STUDY: JOBS DON'T ERASE POVERTY FOR IOWA'S WORKING POOR

AMES -- More Iowans are moving from welfare to work, but many still struggle to support themselves and their families.

"Welfare-reform initiatives have aimed to reduce welfare caseloads and encourage self-sufficiency," Cynthia Needles Fletcher, professor of human development and family studies at Iowa State University. "Their success depends on the ability of parents to adequately support their families through work. Many are finding work, but still remain in poverty."

Fletcher studied Iowa's working poor -- many of whom live in rural communities -- by analyzing U.S. Census data on household income and employment from 1993 to 1995. She has been sharing the results with small-town groups as part of "Quality Jobs for Quality Communities," an ISU Extension program that provides information and support to help communities take steps to improve the quality of local jobs.

The working poor are defined as families with incomes at or below the federal poverty level who also report some earned income. The estimated poverty level is $13,086 for a family of three and $16,766 for a family of four.

Fletcher found that in the mid-1990s, Iowa had 47,000 poor families with children in which the parents were able to work. Some 148,000 Iowans, including 88,000 children, lived in working poor families. Also, 41,000 households without children fit the working poor definition.

Fifty-six percent of poor families received a majority of their income from jobs, while 26 percent received most of their income from welfare. Seventy-one percent of poor families had one or both parents who worked. Of the poor households without children that had adults able to work, 81 percent had one or more workers. Seventy percent of poor families with children did not have a full-time, year-round worker.

"This raises serious questions about job skills and employment barriers facing these families," Fletcher said. "Also, the poverty rate among children is cause for concern because there is strong evidence that poverty has long-term negative effects on the development of children."

Only 21 percent of adults in working-poor families had less than a high school education. "This suggests that a lack of skills may limit some workers to low-paying jobs, but the lack of high-paying jobs and a lack of needed support systems to allow parents to work more hours appear to keep many skilled workers in poverty," she said.

Since 1995, Iowa's robust economy has increased numbers of full-time workers. "However, because the greatest job growth has been in metropolitan areas and the majority of the working poor live in non-metro areas, it's likely that large numbers of Iowans continue to face limited economic opportunities," Fletcher said.

Fletcher identified several policy options for increasing income of working-poor families, including:

• Work to increase the number of higher-paying jobs.
• Raise the skills levels of workers through education and job training.
• Address employment barriers related to transportation, childcare, health insurance and work hours.
• Expand and refund the state's Earned Income Tax Credit to supplement the incomes of low-wage workers.
• Consider raising the minimum wage in Iowa.

"Some of these alternatives are long-term strategies to deal with a seemingly intractable social problem," Fletcher said. 'Yet, the clock on welfare reform is ticking, and if policy-makers want to address a growing number of working poor among those who become ineligible for welfare, consideration should be given to ways to subsidize the wages of parents in low-income families and address the barriers to employment."

News Releases Agriculture in Action Ag Online Communications Skills Home