Sohn: City's poverty is down, but wages are stagnant

Sunset Barbecue owner Javan Martin talks with Gabriel Moore as he splits wood behind the Dodson Avenue small business on Thursday, Dec. 7, 2017, in Chattanooga. Martin works with neighborhood young people to help keep them occupied and teach them work and life skills. He also pays them to help around the restaurant.
Sunset Barbecue owner Javan Martin talks with Gabriel Moore as he splits wood behind the Dodson Avenue small business on Thursday, Dec. 7, 2017, in Chattanooga. Martin works with neighborhood young people to help keep them occupied and teach them work and life skills. He also pays them to help around the restaurant.

If ever we have needed a bit of good news, it is now.

And we have it, thankfully.

The share of Chattanoogans living in poverty fell last year to the lowest level in a decade as the improving economy boosted employment to the record highs, according to new Census Bureau estimates.

But we still have far to go.

Even with faster job growth and eight years of sustained economic growth, Chattanooga's poverty rate still was higher last year than it was before the Great Recession, and it remained - along with most of the South - above the U.S. average.

That's because many of the newly employed are under-employed. Yes, more people have jobs, but far too many of the new jobs don't pay middle-class wages.

Looking at 2016 figures, the U.S. Census Bureau said last week that the nationwide poverty rates fell to 13.5 percent, while the Chattanooga rate fell to 20.2 percent - both are the lowest rates of poverty here since 2007. Meanwhile, the U.S. rate is 14 percent, Tennessee's is 15.8 percent, Georgia's is 16.1 percent and Alabama's is 17.6 percent.

Unfortunately racial demographics continue to tell the story of what is happening: Minorities are twice as likely to be living in poverty as white residents in Chattanooga. Here, 15.6 percent of whites live in poverty while 30.8 percent of blacks and 37.4 percent of Hispanics live in poverty.

In 2016, poverty was defined as incomes of $11,880 or less for one person and $24,300 or less for a family of four.

Add to this, the complicating factor that many of these "new" jobs are entry-level or part-time jobs, meaning that to make ends meet, many workers are working two or three part-time jobs to try to make ends meet. Even the new "tech-related" jobs are short term and freelance jobs - and the erratic scheduling often associated with those jobs make it difficult for people to combine jobs reliable to earn enough wages.

There also is collateral damage of surface success when it is expressed by employment statistics alone.

Gov. Bill Haslam recently reinstated a work requirement for people to get food stamps - based on the record unemployment numbers. Now people without children or disabilities will have to work at least 20 hours a week to receive SNAP benefits - between $15 and $25 a month in what's best known as the food stamps program. And these marginal workers have to sing for their supper and prove each month they worked 80 hours.

Sure there are, as Republican President George Bush once put it, "a thousand points of light." That would describe the efforts of groups such as Y-CAP, which works with at-risk youth, and Sunset Barbecue owner Greg Martin, who works to employ young people in the community to help them learn good work ethics and responsibility. But goodwill needs more than elementary help.

Bill Fox, director of the Center for Business and Economic Research at the University of Tennessee, said the increased jobs are great news for Tennessee, but he adds that state officials hope a continued emphasis on worker training and the economy will boost wages and lift still more people out of poverty.

"It has been perplexing to most economists why we haven't seen more wage gains given the decline in unemployment, he said. "The state is taking steps to improve the education and skills of our workforce, and over time that should pay off in better wage growth."

Over how much time? According to an October announcement by Tennessee's Department of Economic and Community Development, as Tennessee moves forward with new higher education initiatives such as Tennessee Reconnect and Tennessee Promise, graduation rates for certificate and two-year degree programs statewide also hit record highs in the past school year.

In summation: Since 2013, employers in metropolitan Chattanooga have added more than 20,000 net new jobs, boosting local employment by more than 8.6 percent, but wages remain relatively stagnant. Adjusted for inflation, our median income has grown only a meager tenth of a percent.

Explain this to Chattanoogans working more jobs than they ever have to make ends meet.

We have almost half of Tennessee's 52,200 net new jobs. We have record unemployment.

But we have virtually no wage gain, and we have social service agencies telling us they see just as many people in need as they ever did.

How can this be?

Where's the trickle-down?

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