http://articles.moneycentral.msn.com/SavingandDebt/Advice/StudySaysWorkingPoorCannotAffordBasics.aspx?page=allExtra 10/10/2007 3:45 PM ET
One in five working families has a tough time affording basics like shelter and health care while earning too much to qualify for food stamps or Medicaid, according to a new report.
By MarketWatch
About one in five working American families can't afford basic needs, and many scrape to get by on insufficient income and government aid, policy researchers conclude in a report (.pdf file) released today.
Many of these workers earn too much to qualify for "work supports" such as Medicaid and food stamps, while their employer-provided health insurance doesn't cover enough of their basic medical costs, according to the report by the Center for Economic and Policy Research and the Center for Social Policy at the University of Massachusetts.
"We no longer live in a world where having a job means you're automatically able to make ends meet," said Heather Boushey, co-author of the report. "Our work-support policies need to be updated to support the millions of families with earners in bad jobs."
Talk back: Do you earn enough to get by?
About 41 million people in working families can't afford such basic necessities as health care and housing, according to the report. The study, which examined conditions in nine states and the District of Columbia, found that government programs close about two-fifths of the "hardships gap" -- a measure of the difference between a family's income, including all aid programs, and the local costs of goods and services.
"Families fall into the hardships gap because the low-wage labor market provides meager pay and few employment-based work supports for low- and moderate-wage workers," the report noted.
The report's authors recommend steps such as focusing on better wages and mandates for employers to provide employment-based benefits, and simplifying the eligibility criteria and application requirements for work supports.
"Public policy has not caught up to the reality that even working families may need public work supports," the authors wrote. "Without public work supports, they and their families go without health insurance, adequate child care, safe housing or other necessities. Many of those in the hardships gap earn too much, or do not meet other eligibility criteria, to qualify for work supports, even though they are low-income." In 2005, about one-fifth of workers were in "bad jobs" -- those that paid less than the median wage in 1979 in inflation-adjusted dollars and did not offer health insurance or a retirement plan, according to the report. Employer-based benefits are good for people with access to them, but most low-wage workers aren't offered or can't afford them, the report said.
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