POVERTY
Homelessness and poverty are inextricably linked. Poor people are frequently unable to pay for
housing, food, childcare, health care, and education. Difficult choices must be made when
limited resources cover only some of these necessities. Often it is housing, which absorbs a high
proportion of income that must be dropped. Being poor means being an illness, an accident, or a
paycheck away from living on the streets.
In 2005, 13.3% of the U.S. population, or 38,231,521 million people, lived in poverty. Both the
poverty rate and the number of poor people have increased in recent years, up from 12.5% or 1.1
million in 2003 (U.S. Bureau of the Census, 2005). 36% of persons living in poverty are
children; in fact, the 2004 poverty rate of 17.6% for children under 18 years old is significantly
higher than the poverty rate for any other age group.
Two factors help account for increasing poverty: eroding employment opportunities for large
segments of the workforce, and the declining value and availability of public assistance.
Eroding Work Opportunities
Media reports of a growing economy and low unemployment mask a number of important
reasons why homelessness persists, and, in some areas of the country, is worsening. These
reasons include stagnant or falling incomes and less secure jobs which offer fewer benefits.
While the last few years have seen growth in real wages at all levels, these increases have not
been enough to counteract a long pattern of stagnant and declining wages. Low-wage workers
have been particularly hard hit by wage trends and have been left behind as the disparity between
rich and poor has mushroomed. To compound the problem, the real value of the minimum wage
in 2004 was 26% less than in 1979 (The Economic Policy Institute, 2005). Although incomes
appear to be rising, this growth is largely due to more hours worked – which in turn can be
attributed to welfare reform and the tight labor markets. Factors contributing to wage declines
include a steep drop in the number and bargaining power of unionized workers; erosion in the
value of the minimum wage; a decline in manufacturing jobs and the corresponding expansion of
lower-paying service-sector employment; globalization; and increased nonstandard work, such as
temporary and part-time employment (Mishel, Bernstein, and Schmitt, 1999)
Explanation:
