Let’s Make Working Families a Priority

More than a third of Michigan’s children live in families whose incomes are insufficient to cover the costs of basic necessities—housing, food, health care, child care, and transportation. Yet a startling 44 percent of these children have a parent who works full time, 52 weeks a year. What happened to the American promise that hard work would pay off and that we could all offer our children a better life?   

Michigan families are not alone—working families across the Midwest are facing similar challenges. Half of Illinois’ low-income children have a parent who works full time, year round. In Indiana, the number of children living in low-income families increased by nearly 24 percent since 2000. And although poverty, especially among young children, has been increasing in other parts of the country, the Midwest is the only region where poverty has risen among children with working parents.

Most Americans believe that parents who work hard ought to be able to provide for their children. But a recent report from the National Center for Children in Poverty--“Struggling Despite Hard Work: Low-Income Families in Michigan and Detroit”--shows that full-time employment does not always spare families from hardship. A single parent in Detroit working full-time at $8 an hour and supporting two children lives with a staggering gap of $16,000 a year between income and the cost of basic expenses. Parents face tough choices when they don’t earn enough to make ends meet. Ignore the utility bill and risk having the electricity shut off? Postpone needed medical care? Use less reliable child care? 

Because the economy is changing, more and more parents are facing such challenges.  Good jobs are disappearing and being replaced by low-wage jobs. About a quarter of U.S. workers now have jobs that pay poverty-level wages and provide few prospects for advancement and wage growth; most of these jobs don’t provide crucial benefits such as health insurance and paid sick leave.  And the Midwest has been particularly hard hit.

The good news is that government policies can help hard-working parents close the gap between earnings and expenses. “Work support” benefits—such as earned income tax credits, child care subsidies, and health insurance coverage—can provide an extra boost for parents who work for low wages.  Refundable earned income tax credits lower a family’s tax liability and provide extra cash.  Child care subsidies can help parents afford safe and reliable child care while they are working.  And health insurance leads to more preventive care and helps workers and their children stay well. 

Unfortunately, in Michigan, as in many states, families don’t always get the benefits they need. Michigan does not offer a refundable state earned income tax credit as a dozen or so other states now do.  Only 7% of Michigan’s low-income children with working parents receive child-care assistance. Rates of public health insurance coverage for Michigan’s low-income children are much higher, but few of their parents are eligible.

Improving these policies and expanding their reach will takes resources. But if we truly believe that parents who work full-time ought to be able to provide their families with a minimally adequate standard of living, we must address the needs of the growing numbers hard-working parents who are unable to do so.  Michigan—and the nation—can do better if we make the needs of working families a public policy priority.