Ending Hunger in America, 2014 Hunger Report Full Report | Page 47

CHAPTER 1

Share of pretax income

hours). If all household heads and their spouses (if present) in low-income households worked
full-time, year-round, the percent of low-income households would fall from 26 percent to 11
percent.”6 The bottom line: the number of low-income families could be cut by more than
half if a full-time job were available for everyone who wanted one.
What does this mean for ending hunger in America? Well, it is simply not possible unless
there are more full-time jobs. Nutrition programs and other anti-poverty programs can
help compensate for a shortfall in
income, but they cannot replace it.
Figure 1.1 Share of Bottom-Fifth Household Income Accounted
There’s a lot of overheated rhetoric

for by Wages, Cash Transfers, and In-Kind Income,
about government assistance
1979-2007
causing dependency, but the truth
2007:
50%
is that low-income households rely
50.5%
1979:
Wages
on work for most of their liveli40.4%
40
hood. From 1979 to 2007, government assistance to low-income
Cash transfers
34.3%
30
families (cash transfers and in-kind
income such as food stamps, free
20.3%
20
In-kind income
or reduced-price school meals,
13.1%
15.4%
and housing and energy subsidies)
10
actually declined as a share of their
overall income.7 See Figure 1.1.
0
Hourly wages when adjusted for
1979
1983
1987
1991
1995
1999
2003
2007
inflation over this period increased
Note: Wages, cash transfers, and in-kind income comprise, on average, 88 percent of all pretax
by a mere 27 cents.8 Household
income for the bottom fifth. The other 12 percent is made up of capital gains, proprietors’ income,
other business income, interest and dividends, pensions, imputed taxes, and other income.
income increased for most families
Source: Economic Policy Institute (2012), State of Working America, 12th Edition.
by working more hours.
Jobs need to pay better (a subject we turn to in Chapter 2), but the first order of business must be to make sure that
everyone who is able to work can find a job. Those who stand to gain the most from a fullemployment economy are low-wage workers, but the benefits would extend to everyone.
The lost productivity from high unemployment is like a tax on all of us, because high unemployment means the economy is operating at less than full capacity, both reducing
tax revenues and necessitating additional government spending to make up for
the lower private sector demand. The Congressional Budget Office (CBO) projects that the unemployment rate will remain above 6 percent through 2017.9 But
a much better outcome is possible, and policymakers have the tools to improve
the forecast.

Nearly

5 million

college graduates
are in jobs now that require less
than a high-school education.3

Between 2010 and 2020, there will be nearly

3 new college graduates for every 1 job
created that requires a bachelor’s degree.4
www.bread.org/institute?

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