How to find a job in a low-wage economy article How do you survive when your employer isn’t paying you for everything you do?
A new study suggests that you might be better off living in poverty, rather than working in one of the most profitable industries on the planet.
The study by researchers at New York University and the National Bureau of Economic Research looked at the effects of living in an urban area, where the average worker earns $10,000 to $12,000 a year, compared to the $13,000-$14,000 in a rural area.
“If you are making $12.50 an hour, that’s an $18,000 pay cut for a typical worker,” says Robert Shiller, an economist at New Jersey’s Rutgers University.
“We know that when you are living in a high-wage job, you have more of a financial cushion than people who are making less.”
But the researchers found that when people in the low-income bracket were allowed to save money, they were less likely to be financially distressed and less likely than those who were forced to rely on government assistance to live.
And this, the researchers say, was the case regardless of whether the people were employed full-time or part-time.
They also found that while living in low-cost areas was better for the low earners, it didn’t necessarily mean they were better off.
For example, they found that a person living in the rural South would earn $11,000 more than a person in the urban North, but they would still be in poverty.
“That’s not necessarily a good thing,” Shiller says.
“There are a lot of things that make us poor in our lives.”
Shiller and his colleagues say that the study has some important implications for policy makers trying to address poverty.
The researchers used data from the National Longitudinal Survey of Youth (NLSY) to examine the socioeconomic status of households.
This survey, which is conducted every five years, collects information on everything from family structure to health and education, and provides insight into the lives of over 1.3 million people in every state and in nearly 80 countries.
The NLSY is a major source of data for the U.S. Census Bureau.
While the survey offers a snapshot of people’s lives, the results don’t tell us much about the lives and habits of people who aren’t included in the survey.
That’s why it’s important to use the data when analyzing how poverty affects people’s livelihoods, Shiller explains.
“It’s important for policymakers to look at what we are finding in the NLSy and use that as a baseline to make policy changes,” he says.
For instance, the NSLY data show that poverty has increased significantly among young people, even as older adults have been in the majority of the workforce.
For these groups, “The economic pressures of the past decade and a half have not helped them recover from the economic downturn,” Shilla says.
That is because their income levels are much lower than in the past.
“When you look at that, you see that young people are really struggling,” he adds.
“They’re working less and less, and that has not helped their income level.
So policymakers have to consider whether they are able to help young people by offering them a better economic opportunity or a better life.”
The researchers also used data on employment status to understand how income inequality affects employment.
“The NLSys employment data show we are not doing well in our ability to increase the employment of the low income and middle income,” Shilling says.
So what can policymakers do?
Shiller points to the example of California.
As the researchers note in their report, the state has a law that requires employers to pay full- and part-timers $15 per hour.
The law was put in place by the state’s former governor, Pete Wilson, in 2010.
It requires employers in California to pay workers a minimum wage of $12 per hour by 2020, a wage that will eventually be increased to $15 an hour by 2021.
But that law also requires the state to spend $100 million on a new program that is designed to make it easier for people to find jobs.
The California Labor Commission, which regulates the state labor market, is responsible for administering the new program, which will be called the Wage Guarantee.
The Wage Guaranteed is designed, among other things, to increase opportunities for low- and middle-income workers, and it’s currently paying nearly two-thirds of all minimum wage workers.
“So, if you want to be a good citizen of the state of California, you need to be able to afford a $15-an-hour minimum wage by 2020,” Shillson says.
To make sure that this program is implemented effectively, the California Labor Commissioner is trying to improve its training and