From Deseret News archives:
Boom not helping Utah's poorest
Current poverty rate of 10.2% alarming, state report says
Given such positive signs of economic growth, Utah's current poverty rate of 10.2 percent is alarming, according to Utah Issues' State of Poverty in Utah 2006. Nationally, the poverty rate is 13.3 percent.
Thursday's report, said Doug MacDonald, Utah Issues' interim director, should be proof that "the rising tide does not lift all leaky boats. It might lift the yachts and the speed boats, but it doesn't lift all boats."
In nearly all of the report's measures, the plight of Utah's working poor has continued to worsen from previous years. In 2005, the state's median wage was $12.83 per hour, and nearly half — 46 percent — of Utah workers earn less than $12.14 per hour, the minimum income each adult in a two-parent family must earn to be self-sufficient, the report states.
In 2006, the report states, a person must earn $12.98 per hour to afford a two-bedroom apartment and still have enough income to meet other, basic needs.
Despite recent employment gains — 58,300 new jobs in the past year and an unemployment rate below 3 percent — 15.5 percent of Utah families lack health insurance. Money for food is also in jeopardy, as Utah was listed fifth in the nation in terms of food insecurity, meaning families who are unsure where their next meal will come from.
"Given Utah's low wages, increasing housing prices, large families and greater-than-average demands for child care, it is not surprising that a higher percentage of our households are going to bed hungry," the report states.
The report recommends "immediate action" to reverse the downward trend for Utah's low-income residents, including an increase in the state's $5.15 per hour minimum wage; adopting a state Earned Income Tax Credit at 20 percent of the federal credit; and extending the state's Children Health Insurance Program to all low-income families.
Utah Issues also encourages a complete removal of sales tax on unprepared food, rather than the partial removal approved by the 2006 Legislature. Eliminating the remaining 2.75 percent tax would cost the state $100 million, according to the report, and immediately put $40 million into the pockets of the state's low-income and working-poor families.
With a budget surplus of $380 million last fiscal year, now is the time to address the needs of low-income Utahns, MacDonald said.
"It's really a choice between investment in human capital in Utah and investment in cement and steel and roads," he said, noting the state spent $541 million on highway construction alone in fiscal year 2006.
E-mail: awelling@desnews.com
