Low-Wage Earners Are the Focus of the Latest Policy Brief by UB Regional Institute

By Rachel M. Teaman

Release Date: February 24, 2010

BUFFALO, N.Y. -- From cashiers to child care workers, low-wage jobs are filling a growing segment of the Western New York economy, placing more and more Western New Yorkers on the brink of poverty, according to a policy brief released today by the UB Regional Institute.

Between 2004 and 2008, jobs in low-paying occupations, with average annual wages below $30,000, increased 17 percent, while middle-wage jobs ($30,000-$70,000) declined 10 percent. In 2009, one in four jobs was in an occupation with median annual wages below $22,000, the federal poverty line for a family of four.

The brief, "Playing an Insecure Hand: Low-Wage Workers in the New Economy," is available online at http://regional-institute.buffalo.edu.

"These findings portray a new economic reality for Western New York that's in stark contrast to decades past, when the region paid some of the highest wages in the country," said Kathryn A. Foster, institute director. "It raises a host of questions about how to build and sustain economic security for Western New Yorkers."

Multiple jobs are increasingly the norm -- and necessity -- for the average regional household. Statistics for metro Buffalo indicate that 60 percent of households with three or more people have at least two earners. This trend is inherently related to the increasing numbers of women in the workforce, with nearly two out of three women in the region working in 2008.

The brief presents a range of measures of poverty and low-wage work. For example, a full-time job at minimum wage garners just over $15,000 a year. The federal poverty line sets $14,570 as the threshold for a two-person family, well below the $36,000 "living wage" to meet basic needs for a single parent and child, as estimated by Penn State's Living Wage Calculator.

Several factors have contributed to the hollowing out of the region's middle class, which prevailed a generation ago when incomes and home ownership were on the rise. Since 1970 the region has seen income levels stagnate while largely good-paying manufacturing jobs have dropped off.

The impact on the region's wages has been stark. In 1969, metro Buffalo ranked 31st out of 363 regions for average wages per job. By 2008, metro Buffalo fell to 155th.

"This historical perspective demonstrates how the post-World War II economic boom and high unionization rates contributed to a broad middle class for regions like Buffalo," said Peter A. Lombardi, research fellow for the UB Regional Institute. "In today's economy, low-wage work is often the only employment option for Western New Yorkers, while our expectations for standards of living carry over from more prosperous times."

Acknowledging the many policy debates and community discussions already taking place on these issues in the region and beyond, the brief emphasizes that a sense of shared responsibility is critical in confronting the low-wage dilemma.

"We live in an era where private, public and civic safety nets have either vanished or are stretched thin," said Foster. "The smart hand to play for economic security fundamentally requires shared sacrifice and responsibility, but also a realistic perspective on what progress and prosperity mean for households in the region."

Individuals can become more frugal, eliminating "extras" while proactively seeking temporary supports and advanced education or training for long-term economic security. Government can design a preventive safety net, offer fair standards for temporary assistance and support living wage policies. In addition to fair wages, employers can support continuing education and flexible scheduling for family care needs. Civic organizations, from schools to community groups, can reinforce supports for low-wage workers, such as accommodations for non-traditional students, accessible, quality child care and job training.

"Playing an Insecure Hand" is part of the institute's policy brief series designed to inform regional issues with timely, reliable data and analysis.

A major research and public policy center of the University at Buffalo, the Regional Institute plays a vital role in addressing key policy and governance issues for regions, with focused analysis of the Buffalo-Niagara region. A unit of the UB Law School, the institute leverages the resources of the university and binational community to pursue a wide range of scholarship, projects and initiatives that frame issues, inform decisions and guide change.

The University at Buffalo is a premier research-intensive public university, a flagship institution in the State University of New York system and its largest and most comprehensive campus. UB's more than 28,000 students pursue their academic interests through more than 300 undergraduate, graduate and professional degree programs. Founded in 1846, the University at Buffalo is a member of the Association of American Universities.