Working Poor - Prevalence and Trends

Prevalence and Trends

Poverty is often associated with joblessness, but a large proportion of poor people are actually working or looking for work. In 2009, according to the US Census Bureau's official definition of poverty, 8.8 million US families were below the poverty line (11.1% of all families). Of these families, 5.19 million, or 58.9%, had at least one person who was classified as working. In the same year, there were 11.7 million unrelated individuals (people who do not live with family members) whose incomes fell below the official poverty line (22% of all unrelated individuals). 3.9 million of these poor individuals, or 33%, were part of the working poor. If a European-style poverty measure were employed instead of the US Census Bureau's, a larger proportion of poor families and workers would be classified as working poor.

Using the US Census Bureau's definition of poverty, the working poverty rate seems to have remained relatively stable since 1978. However, many scholars have argued that the official poverty threshold is too low, and that real wages and working conditions have actually declined for many workers over the past three or four decades. Social scientists like Arne Kalleberg have found that the decline in US manufacturing and the subsequent polarization of the labor market has led to an overall worsening of wages, job stability, and working conditions for people with lower skill levels and less formal education. From the mid-1940s to the mid-1970s, manufacturing jobs offered many low-skilled and medium-skilled workers stable, well-paying jobs. Due to global competition, technological advances, and other factors, US manufacturing jobs have been disappearing for decades. (From 1970 to 2008, the percentage of the labor force employed in the manufacturing sector shrank from 23.4% to 9.1%.) During this period of decline, job growth became polarized on either end of the labor market. That is, the jobs that replaced medium-pay, low- to medium-skill manufacturing jobs were high-paying, high-skill jobs and low-paying, low-skill jobs. Therefore, many low- to medium-skilled workers who would have been able to work in the manufacturing sector in 1970 must now take low-paying, precarious jobs in the service sector.