In 1996, the United States reformed its welfare system, linking
benefits more directly to paid work. Combined with the expansion
of the Earned Income Tax Credit, which subsidizes low wage
workers through the tax code, work has become a cornerstone of
American anti-poverty policy. At the same time, rising income
inequality and stagnant real wages among less-skilled workers
mean that working one’s way out of poverty is more challenging
than ever before.
See below for more information on research projects and other
resources related to this topic.
In 1996, the United States reformed its welfare system, linking
benefits more directly to labor force participation. When
combined with the expansion of the Earned Income Tax Credit,
which subsidizes low wage workers through the tax code, work has
become a cornerstone of American anti-poverty policy. At the same
time, rising income inequality and stagnant real wages among
less-skilled workers mean that working one’s way out of poverty
is more challenging than ever before.
With these trends as a backdrop, a number of new questions are
emerging. For example, how can government programs best address
poverty if full-time work itself does not provide sufficient
income to move many families out of poverty? Given the evolving
consensus that poor mothers should be expected to work, how will
women’s employment, family structure and poverty evolve in the
21st Century?
Our Research Affiliates are tackling these questions, as well
analyzing trends in immigration and related demographic changes
that have important implications for labor market opportunities
available to the poor.
The connection between poverty and labor markets is complex.
High, stable wages and stable full-time employment can keep many
out of poverty. However, the stagnation of wages at the bottom of
the US wage distribution over the past several decades and
continuing low rates of full-time work, especially in
single-parent households, work will often leave families below
the official poverty threshold.
Millions of workers experienced increased variability in the
regularity and predictability of their working hours in the Great
Recession. This volatility brings negative consequences for their
economic security and family lives, which can be as profound as
job loss. The growth of work variability was facilitated by the
decline of labor market institutions protecting workers from such
volatility, particularly the profound decline of labor unions.
Much attention has been given to the large increase in safety net
spending, particularly in Unemployment Insurance and Food Stamp
spending, during the Great Recession. In this paper we examine
the relationship between poverty, the social safety net, and
business cycles historically and test whether there has been a
significant change in this relationship during the Great
Recession. We do so using an alternative measure of poverty that
incorporates taxes and in-kind transfers.
These briefs are short and informative analyses of our research
relating to poverty policies. Policy Briefs deliver our
cutting-edge research directly to policy makers, researchers, and
stakeholders in an accessible format.
The COVID-19 crisis has hit low-income families especially hard. Unemployment rates have risen highest for those with lower levels of education, and for Black and Hispanic individuals. In response, the Families First Coronavirus Act and the Coronavirus Aid, Relief, and Economic Security (CARES) Act have made important provisions in response. Still, many are suffering, and tremendous need remains unmet. Food insecurity rates have increased almost three times over pre-COVID rates.
When measured relative to median income, poverty in the United
States, at 16.3 percent, is much higher than in many
industrialized, democratic countries. To explain this, scholars,
politicians, and the public often focus on the risks of poverty.
Risks are characteristics more common among the poor than the
non-poor, like low education, unemployment, single motherhood, or
young age of the head of household. In a study I conducted with
David Brady and Sabine Huebgen, we found that the cause of
relatively high poverty in the U.S.
During a job interview, workers cannot tell whether an employer
is prejudiced. However, they can observe the race of a potential
supervisor. In a new study of racial inequality in the labor
market, we tested a model of Black and White workers’ wages and
job stability using a unique dataset that includes the race of
the worker’s supervisor and state-level measures of prejudice.
Our findings suggest that higher levels of prejudice in the state
may cause Black job applicants to accept lower wages in exchange
for the security of working for a Black supervisor. This could
lead to lower average wages for Black workers.
Center podcasts are a great way to keep up with today’s poverty
research and public policy. We record most of our conference
presentations and talks by our seminar speakers. We also produce
exclusive content, such as our Poverty in Focus series, as well
as expert discussions on research.
Ken Jacobs moderates this policy discussion and Q&A on
raising labor standards at the local level. Jacobs is the
Chair of the UC Berkeley Labor Center, where he has been a
Labor Specialist since 2002.
In this presentation, Jeffrey Clemens discusses his work on how
the Great Recession affected employment and income for
low-skilled workers. Clemens is an assistant professor in
the Department of Economics at UC San Diego.
In this presentation, David Pedulla discusses his work on the
stigma of low-wage work based experimental field and survey
evidence. Pedulla is an Assistant Professor in the Department of
Sociology and a Faculty Research Associate of the Population
Research Center at the University of Texas at Austin.
