What Helps Lift Working Poor Families Out of Poverty?

Susan M. Hauan, U.S. Department of Health and Human Services (DHHS)
Laura Chadwick, U.S. Department of Health and Human Services (DHHS)
Scott Fitzgerald, University of Iowa

Understanding the relationship between work and poverty gained importance over the last decade, as states implemented a variety of work-based welfare reforms, welfare caseloads dropped to record lows, employment among single mothers increased, and the share of low-wage workers in the labor market grew. Indeed, the working poor are the fastest growing segment of the poverty population. Using the 1993 SIPP, we examined monthly variation in work and poverty status, and conducted event history analysis to determine the most important predictors (demographic, family, human capital, job, and labor market) of monthly poverty exits among the working poor. Descriptive results showed that nearly 40 percent of the 1993 poor population and 70 percent of the 1993 working poor population, lived with one or more workers who were able to pull the family out of poverty at least some of the months during the year.