New York City experienced a sudden and substantial economic crisis as a result of the COVID-19 pandemic. Overlooked and Undercounted 2021: Struggling to Make Ends Meet in New York City illuminates the characteristics of the 36% (816,151) of households prior to the pandemic that struggled with the everyday crisis of inadequate earnings to meet basic needs. These households, which include nearly 2.4 million people, were the ones most at risk of losing further economic ground as a result of the pandemic. While pandemic-related data is still being gathered, we can look to Self-Sufficiency Standard findings from the Great Recession to understand the possible immediate and long-term economic impact of COVID-19. Workers in low-wage occupations, as well as people of color and single-mother households, were hit the hardest, with more of their households experiencing income inadequacy than before the recession, even when other indicators (such as the unemployment rate) had returned to pre-recession levels. The data from the 2021 report provides a baseline against which to measure the impact of the pandemic-triggered economic disruption as well as the effectiveness of mitigating policies and benefits. Reforms are urgently needed both now and long after the pandemic is over.
The report’s analysis is based on the Self-Sufficiency Standard, a realistic, geographically specific, and family composition-specific measure of income adequacy, and thus a more accurate alternative to the official poverty measure. While income inadequacy exists among all groups and places in New York City, inadequate income does not affect all groups equally. There are substantial variations in the rates of income inadequacy among different groups and by different household characteristics. However, perhaps the most telling conclusion is that income inadequacy is not largely due to lack of work; 84% of households below the Standard have at least one worker, and the majority of those workers work full time and year round.
So what does account for this work-based income inadequacy? Ultimately, the high work levels among households below the Standard indicate that it is inadequate wages not lack of work hours that is an important factor. Eighty-four percent of households below the Standard have at least one worker, and the majority of those workers work full time and year round. This data highlights that workers in New York City will not benefit from returning to jobs that don’t pay a family-sustaining wage. The post-pandemic labor market needs improved opportunities across the city.
Demographic variables are also important. Universally, higher levels of education result in decreased rates of income adequacy. However, for both women and people of color, there are substantially lower rewards from education, such that women and people of color must have several more years of education to achieve the same levels of income adequacy as white men at each education level.
Family composition—particularly when households are maintained by a woman alone and if children are present— impacts a family’s ability to meet basic needs such as food, healthcare, and childcare. The demographic characteristics of being a woman, a person of color and having children combine to result in high rates of insufficient income. Thus, being a single mother—especially a single mother of color— combines the labor market disadvantages of being a woman (gender-based wage gap and lower returns to education) with the high costs of children (especially child care for children younger than school age) and the lower income of being a one-worker household. This results in the highest rates of income inadequacy. For single mothers of color, racial/ethnic wage differentials and race-based differences in rewards from education further increase rates of income inadequacy to the highest levels; 79% of Latina, 73% of Black, and 68% of Asian single mothers lack adequate income, compared to 49% of White single mothers. Nativity also plays a major part in self-sufficiency rates; while about one-third of native-born New York City households have inadequate income, 37% of naturalized citizens and 51% of non-citizens lack adequate income. Thus, pandemic recovery policies must include an intersectional racial, gender, and citizenship lens to assist with an equitable recovery.
Using the Self-Sufficiency Standard, this report finds that the problem of inadequate income is extensive, affecting families throughout New York City before the pandemic, in every racial/ethnic group; among men, women, and children; and in all boroughs. Households with inadequate incomes are part of the mainstream workforce, yet despite working long hours, they are not recognized as having inadequate income by the federal poverty measure.
This lack of sufficient income to meet basic needs is grossly undercounted largely because measures like the official poverty measure do not accurately document what it takes to afford just the basics, nor do they accurately pinpoint who lacks sufficient income. Not only do governmental poverty statistics underestimate the number of households struggling to make ends meet, but the underestimation creates broadly held misunderstandings about who is unable to afford basic needs, what skills and education they hold, and therefore what unmet needs they have. These misapprehensions harm the ability of our society to respond to the changing realities facing families with insufficient income.
The Standard includes the costs of basic needs for working families including housing, food, health care, child care, transportation, taxes, and other miscellaneous expenses. It assumes the full cost of each need, without help from public subsidies (e.g., public housing or Medicaid) or private assistance (e.g., unpaid childcare or food from a pantry). The nuanced measure reflects the higher costs facing some families and the geographic diversity of costs among boroughs. Although women and people of color experience inadequate income disproportionately, New York City households with inadequate income reflect the city’s diversity: they come from every racial and ethnic group, reflect every household composition, and overwhelmingly work hard as part of the mainstream workforce.
Ultimately, based on the findings from the report, it is clear that there is an urgent need for bold policy reforms that make food, housing, health care, and child care more affordable, increase worker income and pay parity, and ensure an adequate safety net that protects all people. It is critical to provide an equitable recovery across every neighborhood in New York City.
We invite you to explore what we’ve learned below with these interactive tools:
| Overlooked and Undercounted 2021: Struggling to Make Ends Meet in New York City was authored by Annie Kucklick and Lisa Manzer from the Center for Women’s Welfare at the University of Washington, and supported by a coalition of nonprofits: The Women’s Center for Education and Career Advancement (WCECA), The United Way of New York City, The Fund for the City of New York, The New York Women’s Foundation, City Harvest, Food Bank For New York City, and Hunger Free New York City (a division of Hunger Free America). This report updates the 2018 brief series. |