New Study Finds Startling Rate of Poverty among Working-Class Families

A new study prepared by the Government Accountability Office (GAO) for Sen. Bernie Sanders (I-Vt.) has found that the federal minimum wage is too low to keep working families out of poverty.

Twenty percent of working families earning the $7.25 minimum wage or below live in poverty, according to the report, which has prompted 30 Senate Democrats to sign onto a bill introduced by Sens. Sanders and Patty Murray (D-Wash.), which would raise the minimum wage to $15 per hour by 2024.

"As this new report shows, $7.25 minimum wage is a starvation wage that is not enough to keep working families out of poverty." Sanders said. "The United States Congress must raise the minimum wage to a living wage.”

The GAO also found, not surprisingly, that higher wages were associated with lower poverty rates. Unfortunately, low-wage workers – those earning $16 per hour or less – comprise about 40 percent of the U.S. workforce aged 25 to 64. Millions of them are living in poverty and relying on government programs such as Medicaid and Supplemental Nutrition Assistance Program (SNAP).

The GAO report noted that the growing divide between the top 1 percent and everyone else is not only due to wage stagnation among low-wage workers, but in fact attributable to skyrocketing wealth among high earners.

“Recent studies have found that while average wages experienced little or no change from 1973 through 2011 (when held in constant 2011 dollars), income inequality increased as a direct result of income growth among high-wage workers,” the GAO wrote.

For the full report, click here.

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