Florida Still Has Work To Deal With Poverty

Jan 10, 2014

In this week’s Economic Report, Dr. Rick Harper discusses issues related to poverty, on the 50th anniversary this week of President Lyndon Johnson’s 1964 declaration of “War on Poverty.”

Credit University of West Florida

Looking at measured poverty rates for Florida, the most recent data shows 17.1 percent of people living in poverty, slightly higher than the national rate of 15.9 percent. For Northwest Florida, which is a lower income area, the poverty rate is about 2 percentage points higher than that of the state.  Harper says one measure of poverty is family income; and he notes that there’s no adjustment for regional differences in cost of living.

As it relates to the income gap, Harper says the top 20 percent income earners over the last 30 years have seen their after tax income grow close to 300 percent, while those in the bottom 20 percent of income earners have seen their income grow by less than 20 percent. Harper attributes technology change, “People that master technology have better wage jobs.” Also, he adds that globalization is a factor, “More and more Americans are in the position of competing more directly with foreign workers.”

Finally, Harper also shares his thoughts on a new Quinnipiac poll that says broad majorities of Americans favor an increase in the federal minimum wage.  From an economic perspective, Harper doesn’t believe it’s the right approach, particularly for employers.  “If we raise the wage that they have to pay, then alternatives are going look better. It might be that you (employer) replace that worker with a machine,” he says.  He prefers providing assistance to lower income workers through earned income tax credits.

Dr. Rick Harper is Director of the University of West Florida Office of Economic Development and Engagement. He’s currently serving as Senior Economic Policy Advisor to the Florida Senate.  http://www.uwf.edu/oede/, or at rharper@uwf.edu