Congress Must Do More to Help Working Families

By Amelia Collins, Associate Policy Analyst, NCLR

According to new data from the U.S. Census Current Population Survey (CPS), income levels and poverty rates for most Americans are unchanged from last year and vast disparities persist between Hispanics and Whites. The Census released the latest data on income and poverty in the United States late last week and includes the CPS, the source for the national official poverty measure. The second set of data released, the American Community Survey (ACS), offers an economic picture at the state and local levels.

Overall, 14.8% of Americans live in poverty. For Whites, the poverty rate in 2014 was 10.1%, less than half the rate of 23.6% for Hispanics.

The median income in 2014 for Hispanics remains below prerecession levels at $42,491. The median income for Whites in 2014 was 42% higher at $60,256.

Although, according to the CPS, there has been no significant change in the overall poverty rate for Latinos over the past year, the number of Hispanics living in poverty has decreased, even with an uptick in the overall Latino population. According to the ACS, in 2014, 252,000 fewer Hispanics, including about 160,000 Latino kids, lived in poverty. This decrease comes even as the total Latino population grew by 1.3 million, including 97,000 children, from 2013 to 2014.

While academics can debate the best source to determine poverty rates, there is no questioning what Congress should do in response to these new numbers: they must pass legislation to help hardworking American families stay out of poverty.

Improving jobs and the economy remain a top priority for the Latino community. A 2014 poll by Latino Decisions and NCLR found that a majority of Latinos continue to worry about their financial security, with 70% concerned they are not earning enough to cover their basic expenses. Unfortunately, Congress has yet to take action on policies that would help millions of Americans stay above the poverty line. Two policies Congress should advance this year to respond to Latino voters’ economic priorities are:

  • Save expiring provisions of the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC). The EITC and the CTC are refundable tax credits for American families. Improvements to these pro-work programs made in 2009 are set to expire in 2017. If Congress does not act to make those critical expansions permanent, five million Latino families stand to lose an average of $1,000 each. In total, 16 million Americans will be pushed into or deeper into poverty.
  • Raise the federal minimum wage from $7.25 to $12 an hour. Doing so would increase the income for millions of working families, including 5 million Latino workers, who are concentrated in low-wage jobs. Persistent wage stagnation has left many families without the means necessary to cover necessary expenses. According to U.S. Census data, over 1.2 million Hispanics who worked full-time year-round lived below the poverty line. These hardworking families deserve to earn a living wage.

As the Latino population continues to grow and their share of the electorate increases, politicians must pay increasing attention to the economic well-being and the priorities of the Latino community. It starts with action for working families.

America Needs a Raise

By Stephanie Román, Economic Policy Analyst, NCLR

The federal minimum wage has been stuck at $7.25 since 2009, while the cost of most everything has increased since then. Worse, the minimum wage for tipped workers has stayed frozen at $2.13 per hour for more than 20 years. Yes, you read that correctly, 20 years. It’s clearly time to raise the minimum wage. The “Raise the Wage Act” sponsored by Senator Patty Murray (D–WA) and Representative Bobby Scott (D–VA) would do just that by raising the minimum wage to $12 by 2020 and gradually bringing the tipped minimum up to parity with the minimum wage.

This badly outdated minimum wage heavily affects Latinos, who are concentrated in low-wage jobs. Latinos are 16% of the labor force, yet represent nearly one-quarter (8.5 million) of those who would benefit from raising the minimum wage. As a result of low wages, many hardworking Latino families struggle to cover the rising cost of living. Raising my voice to raise the minimum wage is important to me because the financial struggles of low-wage workers are the struggles my parents and community members faminwage_presentationce.

Last Tuesday, I had the opportunity to talk about what raising the minimum wage means to our community at a congressional briefing at the U.S. Capitol. Congresswoman Donna Edwards (D–MD) also spoke and stressed the importance of raising the minimum wage, particularly for women of color. At the briefing, I emphasized the critical role raising the minimum wage has in helping to lift 4.2 million hard-working Latina women, our mothers, sisters, and wives, out of poverty.

Too many Latinas are living in poverty. In 2013, almost one-quarter of all Latinas were in poverty. Under the proposed $12.00 increase by 2020, nearly half (43%) of all working Latinas would get a raise. Higher wages are especially important to hardworking mothers. Nearly half (1.8 million) of all working Latinas who would get a boost in pay are mothers, including almost 900,000 single mothers. A minimum wage increase for Latina working moms is critical because almost half of Latina single-mother families lived in poverty in 2013. Hard-working Latina moms earning poverty wages shouldn’t have to decide between paying the bills and putting food on the table for their kids.

MinWage_2in5Latinas

Latinas are not alone in facing these economic hardships. Raising the minimum wage is a critical issue for the entire Latino community. A vast majority (78%) of Latinos polled supported an increased minimum wage in 2014, according to an election eve poll. Raising the wage is a Latino voter priority. Our community continues to feel the economic strains of the recession with high rates of poverty and higher levels of unemployment than the national average, even as they have the highest rate of labor force participation among all groups.

Raising the minimum wage is a critical poverty-fighting tool we support because it will mean increased economic security and greater opportunities for Latino workers, our families, and our communities to thrive.

Home Care Is Real Work That Deserves a Fair Wage

By Stephanie Román, Economic Policy Analyst, NCLR

HomeCareWorkersblog_pic1
Supporters of the Home Care Rule in front of the Federal Courthouse in Washington, DC at the Home Care Rule press conference.

D’Rosa is a home care worker who struggles to make ends meet. She is from Georgia, where she works with elderly adults. At a recent press event in Washington, DC, D’Rosa and other home care workers addressed a crowd of reporters and advocates to make the case that home care work is real work.

D’Rosa spoke about the aspects of her work that she loves—forming strong bonds with her clients—but also its difficulties: “I do not get any overtime. It’s $9 an hour no matter how many hours we work. I love my job, but my family is just scraping by.” Home care workers like D’Rosa are fighting not only for access to minimum wage regulations and overtime protections, but also for recognition and dignity as workers.

D’Rosa’s story is just one of many from home care workers who would benefit from a pending U.S. Department of Labor rule on home care. The much-needed rule would expand minimum wage and overtime rights established by the Fair Labor Standards Act (FLSA) to the two million home care workers who currently lack these basic protections.

Home care workers are predominately immigrant women and women of color. They provide individual care to elderly adults and assist people with disabilities with daily living tasks. NCLR has produced fact sheets and blog posts on these critical yet vulnerable workers.

In January, the Department of Labor took a critical step to address poverty-level wages and a lack of overtime compensation for home care workers by issuing the Home Care Rule to expand FLSA protections. The rule corrects a decades-long injustice of excluding home care workers from basic employment protections. Home care workers were left out of the 1974 update to the FLSA that expanded labor protections to domestic workers.

The proposed rule reflects an increasing recognition of the value of home care work, yet the rule is being challenged in court by home care business associations. The legal challenge could mean that the two million U.S. home care workers who desperately need these protections will continue to struggle financially.

HomeCareWorkersblog_pic2

D’Rosa, a home care worker from Georgia, speaking at the Home Care Rule press conference..

Home care work is physically and emotionally demanding, there is high turnover, and compensation is low. Moreover, employers that pay their employees a living wage can benefit from less turnover, greater productivity, and lower training costs. Home care is a multibillion-dollar industry that is projected to keep growing as the U.S. population ages. By 2020, the home care industry is predicted to grow by 1.3 million jobs, a rate of 70 percent—much faster than the growth rate of 14 percent for all occupations.

Poverty-level wages undermine the economic security of workers and their families and do not equate with the value that home care workers provide. Home care workers make an average of $9.70 per hour. Another estimate, which factors in unpredictable schedules and part-time hours, approximates median annual earnings of just $13,000 for home care workers, leaving one-quarter of home care worker households below the federal poverty line.

It’s difficult to not be moved by the stories of everyday struggle that D’Rosa and others face as home care workers. As a working mother, she’s doing her best to provide for their children with wages that make it nearly impossible. The Department of Labor’s Home Care Rule would help tremendously in making sure that these valued workers can keep caring for our loved ones.

A Minimum Wage Hike is Needed to Help Close the Income Gap

min_wage_3Recent data released by the U.S. Census Bureau showed that Latinos experienced modest gains in income during 2013, helping raise about 900,000 Hispanics out of poverty. While the numbers certainly indicated that the economy is moving in the right direction, the reality is about a quarter of all Latinos living in the U.S. are still stuck in poverty. Long term wage trends give a more accurate picture of just how difficult it is to move up the economic ladder.

To gain some perspective on how income levels have changed over the years, NPR has assembled multiple graphs which paint an alarming picture of the growing income inequality in the U.S. over the past 40 years. The graph shows that income levels have essentially remained stagnant for those among the bottom half of earners, after adjusting for inflation. In comparison, those in the 95th percentile saw their income increase by about 36 percent.

NPR Graph

Graph: NPR

Without policy intervention to change the structures and systems that perpetuate inequality, this picture will only get worse. Congress needs to act to help close the gap between the top earners and those at the bottom of the economic ladder. And the first place they should start is at the very bottom. Workers living on a minimum wage earn just over $15,000 per year. That’s simply not enough to cover basic expenses. Most families in the U.S. couldn’t fathom what living with such as constrained budget would be like. It would mean making impossible choices between putting food on the table for your children and paying medical bills.

The “Minimum Wage Fairness Act” (S. 2223), which was introduced a year ago on October 10th (10/10), would raise the federal minimum wage from $7.25 per hour to $10.10 per hour by the year 2016 and adjust the minimum wage each year to keep pace with the rising cost of living beginning in 2016. However, Congress failed to advance this legislation this year.

As we approach the anniversary of the bill’s introduction, it’s time for Congress to act to raise the minimum wage. This modest boost in wages would increase pay for nearly 28 million Americans, including almost 7 million hardworking Latinos, and has the potential to lift 6 million Americans out of poverty.

In a country that has seen the income for top earners soar over the past 40 years, it’s unacceptable that we can’t provide decent, livable wages so that struggling families can get by. Ten dollars and ten cents may not seem like a lot, but for minimum wage workers it can make a world of difference.

Join the discussion by sharing your minimum wage story with NCLR.