Despite low poverty rate, one in seven families is low-income

from The Boston Herald

Despite the state’s low poverty rate, at least 48,000 low income families struggle to make ends meet, according to a University of New Hampshire report.

The report by the university’s Carsey Institute, a rural studies think tank, finds that overall New Hampshire boasts a high quality of life: People are well educated, incomes are relatively high, and the state’s poverty rate is the lowest in the nation.

Yet in the midst of this prosperity, one in seven New Hampshire families is low income, and dropping incomes and rising housing costs are compounding their struggles, the report found.

“The struggles of low-income families are especially troubling since we have seen strong economic growth in recent years,” said Allison Churilla, the study’s author.

Between 1999 and 2004, low income families’ annual earnings dropped 9 percent, from about $7,300 per person to $6,700 per person. That and other factors, like a drop in work force participation, means more low income families are living in poverty - rising from 29 percent in 1999 to 38 percent in 2004, the study, based on U.S. Census data, found.

During the same period, low income families spending more than half their income on housing increased from one in three to more than half.

“Because a larger share of low-income families rent their residences and rental costs are variable, low-income families tend to be more vulnerable to rising housing costs,” Churilla wrote.

Families headed by young adults and single parents - particularly women - have a higher risk of struggling financially, the report said.

Adults in their 20s and 30s have startup costs, lower-paying jobs and less stable housing and because most them have younger children, “young adults’ instability therefore puts young children at a heightened risk of low income,” said the report, which found 23 percent of families with young children also had low incomes in 2004.

While the number of children living in low income families fell by 7 percent between 1999 and 2004, the number of children living in low income, single mother families increased by 14 percent. In all, the total number of single mother families in New Hampshire grew by 10 percent during that time.

“The risk is incredible for single mothers,” said Churilla, noting that many single moms have less education and therefore work in low-paying jobs. Child care also is an obstacle to gaining full-time, higher-income work, and there are signs that single mothers may not be taking full advantage of state programs, she said.
Then there is the issue of pay - New Hampshire’s minimum wage of $5.15 an hour is the lowest in New England.

“Proposed increased in the minimum wage could bolster workers’ earnings and promote economic self-sufficiency for 28 percent of New Hampshire’s low-income families,” Churilla wrote.

http://www.carseyinstitute.unh.edu/