COMMENTARY: Why the Federal Poverty Line Does Not Begin to Tell the Story of Poverty in the United States | Opinion
Still, Chase doesn’t consider himself poor. Perhaps more importantly, neither does the government. In 2020, it was well above the federal poverty line for a single person.
At the waiting tables in eastern Kentucky, Jenna Terry earns a pre-tax income of about $ 20,000. She lives with her boyfriend, Doug, a car salesman who earns an extra $ 20,000. None of their employers offer health, vacation or sickness insurance. The couple have a young daughter and the $ 40,000 they earn together is almost double the federal poverty line for a family of three.
Despite this, they struggled to pay their monthly bills, which included a high interest car loan. To reliably cover basic expenses, Terry’s family would need an income of $ 53,818, according to the Economic Policy Institute.
Low-wage workers get lost in the gap between economic self-sufficiency and the federal poverty line, which is calculated using an outdated equation that may never have made sense. It is determined by comparing pre-tax cash income to a threshold that is three times the expected costs of groceries, then adjusted for family size.
In 2019, 53 million Americans, or 44% of the country’s workers aged 18 to 64, worked in low-wage jobs that paid a median annual salary of $ 18,000.
According to available census data, about 51% of working people earn less than $ 35,000 per year, which is slightly above the federal poverty line for a family of four, and less than what they need to be able to. afford a modest two-bedroom apartment. A recent survey found that on average, a modest two-bedroom apartment with the average national market rent of $ 1,061 required an hourly wage of $ 20.40. This is an annual salary of $ 42,432.