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When Working Doesn’t Pay

Posted by Keely Stater

What barriers do households receiving housing assistance face when it comes to working? The Housing Impact Report (formerly the PAHRC Report) delves into this question in its newest feature on trends in work and employment among households living in homes made affordable through publicly supported housing assistance programs.

The report provides updated statistics and analyses and demonstrates that nearly 80% of households who are able-bodied and of working age who receive rent assistance are working or have recently worked. However, the report demonstrates these low-income renters face additional barriers to work that make attaining a mid-wage job and affording market-rate housing difficult.

Among the 20% not working, half include households with a child under six, an adult over 82, or someone with physical limitations. Nearly 1/3 of working-age assisted renters report having a disability that precludes work and 44% report having some health issue that limits work.

Research shows adults with poorer health or chronic conditions are more likely to participate in rental assistance programs. Health issues may reduce hours and limit their ability to work a salaried job. Adults receiving rent assistance report lower levels of high school and college completion at a time when jobs requiring some type of higher education have increased 68% over the last thirty years. Education and skilled trade training programs can be expensive and prohibit labor market investments for low-income people. For instance, the average cost of a college degree from a public university for a family making less than $30,000 per year is $37,000. Adults living in publicly assisted housing report more volatile work hours and instances of caretaking at levels higher than the average low-income adult. Childcare can be expensive and cost-prohibitive. Among households receiving rental assistance who are working, about 17% are paying for childcare, at the cost of over $4,000 per year, or 1/3 of the yearly income of the average assisted household.

Housing affordability remains a challenge for working low-income adults. As reported by the National Low Income Housing Coalition (NLIHC), someone would have to work 122 hours per week at minimum wage to afford the average two-bedroom rental. This amount is beyond the scope of even a family with two earners; many assisted families have just one earner.

Many affordable housing providers are offering programs that can help households build their labor market skills and save for further investments in education, childcare, and healthcare. Career development programs, and programs promoting savings, access to childcare and healthcare services can all reduce the barriers low-income adults face in attaining mid-wage jobs. However, more resources and programs are needed to help low-income families make meaningful job advancements rather than just plug into the labor market. The path to economic independence is about more than just about getting a job; it’s getting a good job.

More programs investing in labor market skills and removing barriers to mid-wage jobs are needed. Without them, childcare, healthcare, and education will remain cost prohibitive and market-rate rental units will remain unaffordable and out of reach for many low income earning adults.

You can read more about these issues as well as how housing providers are addressing them in the Housing Impact Report by clicking here. This yearly report provides annual updated statistics and analyzes current trends relating to those served by publicly supported housing programs and the impact of these programs on people and places. It also gives housing providers and advocates key statistics they can use to describe the importance of these programs and how they can best serve people living in these homes.