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Home Publications Blogs CEPR Blog Nearly 1.4 Million Workers Have Below-Poverty Incomes; Most of Them Have Education Beyond High School

Nearly 1.4 Million Workers Have Below-Poverty Incomes; Most of Them Have Education Beyond High School

Written by Shawn Fremstad   
Wednesday, 13 February 2013 14:25

In his State of the Union address, President Obama reminded us that "there are millions of Americans whose hard work and dedication have not yet been rewarded… for more than a decade, wages and incomes have barely budged… We know our economy is stronger when we reward an honest day’s work with honest wages." The table below provides a perspective on this trend. It shows the increase between 2007 and 2011 in the number of workers (ages 25-64) below the federal poverty line, and breaks the numbers down by educational attainment.


As the table shows, there were nearly 1.4 million more workers with below-poverty incomes in 2011 than in 2007, and the worker poverty rate increased from 4.9% to 6.2%. Pundits typically frame poverty as being due to low educational attainment (when they're not ascribing it to bad parenting practices), but the table shows how narrow-minded this is. Yes, poverty rates are higher among workers without a high school diploma, but the vast majority of workers below the poverty line (72% in 2011) have a high school diploma or higher, and more than one in three today have a BA degree or some college. As I've noted previously, Americans living below the poverty line today are better educated than e ver, a trend that appears to have continued over the last several years.

One caveat here is that the federal poverty line (a laughable $18,500 for family of three) hasn't been updated for changes in mainstream living standards since the Beatles' first American tour. As a result, the table substantially undercounts the number/percentage of American workers who don't have sufficient incomes to make ends meet.

Tags: education | inequality | poverty | workers

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