This document discusses the cost of living for families in the Cedar Rapids, Iowa area and compares it to poverty guidelines and family-supporting wages. It finds that a high proportion of Iowa families, especially single parents, live on incomes below what is needed for basic needs. While education increases earnings and decreases poverty, many Iowans currently struggle to afford basic necessities even when working full time. Investing in postsecondary education generates tax revenues that offset program costs.
Florida Social Conference: Do more than dump links on social media
Recovering Lost Opportunities: Supporting Today's Workforce for a Brighter Tomorrow
1. Recovering Lost Opportunities:
Supporting Today’s Workforce
for a Brighter Tomorrow
Community Condition Event
October, 2012
Lily French
Senior Policy Consultant
www.iowapolicyproject.org • www.iowapolicypoints.org • www.iowafiscal.org
2. Cost of Living for Cedar Rapids MSA, 2011
(Linn, Benton & Jones Counties)
Single Parent Married Couple: Two Children**
One child* Two children** One Works Both Work
Monthly Expenses
Child care 531 845 - 845
Clothing & household expenses 289 369 398 398
Food 370 554 739 739
Health care 337 437 588 588
Rent and utilities 623 872 872 872
Transportation 560 560 560 840
Monthly total 2,711 3,637 3,157 4,282
Annual Total Basic Expenses 32,527 43,649 37,886 51,389
Income and Taxes
Before-tax earnings needed 36,151 49,769 39,110 57,977
Less: Income & payroll taxes (4,007) (6,155) (3,539) (6,633)
Plus: EITC & other credits 383 35 2,315 45
Net after-tax income 32,527 43,649 37,886 51,389
Family supporting hourly wage $18.08 $24.88 $19.56 $14.49
*One child age 2 or 3 **One child age 2 or 3, one child age 6-10
4. Comparing Poverty Guidelines &
Family Supporting Wages
Family Type Family Supporting Federal Poverty
Annual Income Guidelines
Single adult $20,102 $10,890
Single parent, one child $32,221 $14,710
(under 5)
Single parent, two $42,471 $18,530
children (ages 3, 10)
Two parents, one child $31,711 - $41,143 $18,530
(under 5)
Two parents, two $37,108 - $50,193 $22,350
children (ages 3, 10)
Source: 2011 HHS Poverty Guidelines http://aspe.hhs.gov/poverty/11poverty.shtml
5. Iowans Struggling to Get By in 2011
• Estimated proportion of working Iowa families with income
below a basic needs budget
Proportion Margin of
Below Error
Statewide
Single persons 28.0% 3.0%
Married couples without children 12.1% 1.8%
Married couples with children under 18 22.9% 2.3%
Single parents 74.0% 7.8%
All households 22.7% 1.4%
Linn County: All households 18.7% 2.8%
Source: The Cost of Living in Iowa, Iowa Policy Project, 2012
9. Education Benefits
Individuals & Communities
• With each successful educational attainment
– Earnings rise
– Unemployment and underemployment declines
– Living in poverty declines
10. Education Benefits the State’s Budget
• Investments in postsecondary education for
low-income adults generates income tax
revenues more than double the state’s
program costs
– Associate’s degree - $3.70 for every dollar
– Bachelor’s degree - $2.40 for every dollar
11. Contact Us
• Lily French
Senior Policy Consultant
lily-french@uiowa.edu
• Peter Fisher 319-338-0773
Research Director
www.iowapolicyproject.org
pfisher@iowapolicyproject.org
Hinweis der Redaktion
Explain who IPP is.
NEEDS updating for methodology & discussion of tax added!!!! – pull from Peter’s methodology slidesThe family budgets we use in this study represent a very frugal and modest living standard. (Mention- our report has info for all Iowa counties across 21 different family types)Lead with Budget assumptions: USDA low cost food plan, HUD 40% market rate, transp. to/from work., as well as health care, federal and state income taxes, and clothing and other necessities. Child care -- Assumptions on ages of children – 1 child is 2-3 years old, 2nd child is 6-10(Appendix: complete explanation of the methodology). No money is included for debt payments or skill training; for entertainment, vacations, or restaurant meals, or even for savings for retirement or a child’s college education. You can see child care, housing, and transportation are the three largest components of a family budget. These expenses are exactly what get undercounted when determining federal poverty thresholds.Note that child care and health care are county-specific; food is national, clothing and HH expenses based on the midwest. Housing and transportation are county specific, as are property taxes (because rent is county level). Determined Single parent Family supporting wage for 1 child $18.08, 2 children $24.88. Two parents with 2 children, 1 working, 1 at home $19.56 with both working $14.49 each.Something here about total expenses; then we calculate what their earnings would need to be to bring home their calculated expenses.
While I have provided this information for the Cedar Rapids, MSA… (and just 4 different family sizes), we do have information on the Iowa Policy Project’s website for a greater number of family types for each county in Iowa – just click and the information will pop up.