When jobs don’t pay enough, workers turn to public assistance to meet their basic needs. Public assistance programs – including SNAP, the Supplemental Nutrition Assistance Program – provide vital support to millions of working Americans. A new study from the UC Berkeley Center for Labor Research and Education details the high public cost of low wages.
Researchers Ken Jacobs, Ian Perry, and Jenifer MacGillvary found that poverty-level wages cost U.S. taxpayers nearly $153 billion every year in public support for working families. More than ten million working families receive SNAP benefits (formerly known as food stamps); this figure represents more than 36% of the program’s total enrollment.
From the report:
“Even as the economy has at last begun to expand at a more rapid pace, growth in wages and benefits for most American workers has continued its decades-long stagnation. Real hourly wages of the median American worker were just 5 percent higher in 2013 than they were in 1979, while the wages of the bottom decile of earners were 5 percent lower in 2013 than in 1979. Trends since the early 2000s are even more pronounced. Inflation-adjusted wage growth from 2003 to 2013 was either flat or negative for the entire bottom 70 percent of the wage distribution. Compounding the problem of stagnating wages is the decline in employer provided health insurance, with the share of non-elderly Americans receiving insurance from an employer falling from 67 percent in 2003 to 58.4 percent in 2013.”
Per the researchers, this is the first report to look at the cost to the 50 states of public assistance programs for working families. A previous UC Berkeley study looked at the public cost of low wages in the fast food industry.