Study: Economic mobility depends on the state you live in | Culture of Resistance

Study: Economic mobility depends on the state you live in | Culture of Resistance.

The ability of individuals to achieve the American dream depends on where they live, according to the first state-by-state look at the opportunity to move up the economic ladder.

People who live in Maryland, New Jersey, New York, Connecticut, Massachusetts, Pennsylvania, Michigan and Utah are more likely to improve their economic standing after their prime working years than the typical American, a study by the Pew Charitable Trusts finds.

In Louisiana, Oklahoma, South Carolina, Alabama, Florida, Kentucky, Mississippi, North Carolina and Texas, people are less likely to improve their economic standing, and in some cases, are falling behind.

Economic mobility “is a measure of opportunity and a measure of the health of the American dream,” says Erin Currier of Pew’s Economic Mobility Project.

Educational attainment, the ability to save or gain assets and neighborhood poverty impact economic mobility, Currier says.

The study used Census and Social Security Administration earnings data for individuals born from 1943 to 1958. It focused on prime working years, the 10 years from ages 35-39 and 45-49.

Timothy Smeeding, director of the Institute for Research on Poverty at the University of Wisconsin-Madison, says people are more likely to do better for themselves — and their children are likely to do better — in states with more educated residents and more dynamic economies, such as those in the Northeast.

“This study shows place matter,” Smeeding says. “It shows the American dream is harder to reach in some places.”

Scott Winship, a fellow of economic studies with Brookings Institution, says economic mobility is particularly important for the poor. He says 40% of the people who are born in the bottom rung of the economic ladder stay there.

In North Carolina, where the poverty rate is 16% and unemployment hovers at 9.7%, it’s not surprising that fewer residents move up economically, says Gene Nichol, director of the Center on Poverty, Work and Opportunity at the University of North Carolina-Chapel Hill.

“The South is the native home of American poverty,” he says.

Timothy Bartik, senior economist at the W.E. Upjohn Institute for Employment Research in Michigan, says higher moblity in that state is likely due to higher wages in manufacturing and public sector jobs compared to other states. However, he says the state has been hurt by cuts in the number of manufacturing and public sector jobs.

“Unless Michigan can either reverse these trends or boost educational attainment in the future, any current high ranking it might have in economic mobility will tend to decline over time,” he says.

(via america-wakiewakie)

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How President Obama Could Move Millions Into The Middle Class

How President Obama Could Move Millions Into The Middle Class.

via How President Obama Could Move Millions Into The Middle Class.

President Barack Obama is pledging to make the rest of his time in office about “making this country work for working Americans again.” That means one branch of government is on the case.

After rejecting White House proposals to create good jobs that would rebuild our crumbling infrastructure and invest in renewable energy, Republicans in Congress have already put hundreds of thousands of people — or more — out of work with meat-ax budget cuts that may last through the end of next year.

Fortunately, Obama doesn’t have to wait for Congress to help move two million Americans into the middle class. He can issue an executive order that would improve earnings for low-wage workers whose jobs are financed by the federal government. He can do it now.

In his speech at Knox College in Galesburg, Illinois, Obama recognized that “the income of the top 1 percent nearly quadrupled from 1979 to 2007, while the typical family’s barely budged.” He aims to do something about this growing inequality by implementing what he calls “middle-out economics” — a strategy that hinges on good jobs, quality education, affordable health care, a secure retirement, and strong neighborhoods.

Building the middle class starts with good jobs. Today, most new jobs are in retail, home health care, fast food, and other low-paying fields. But these jobs don’t have to pay low wages. After all, factories paid low wages before workers organized unions in the 1930s and won decent wages and benefits. And unlike factory jobs, many service jobs can’t be exported overseas.

In the 1930s, and again in the 1960s, the federal government helped raise wages for workers. Congress passed laws and presidents issued executive orders that required businesses with federal contracts to pay their workers their industry’s prevailing wage. That meant better pay.

Those laws are now outdated. They only cover one out of five federally funded private-sector workers. Even for those workers still covered, wage rates can be little higher than the federal minimum. According to a recent study by the think tank Demos, the federal government now funds over two million jobs paying under $12 per hour — more than Walmart and McDonald’s combined — in such industries as food, apparel, trucking, and home health care.

In another report on the federal-contract workforce, the National Employment Law Project (NELP) interviewed over 500 contract workers. The group found that 74 percent are paid less than $10 per hour, and 58 percent receive no benefits from their employer.