Late Fall 2018
November 08, 2018
The Ant and the Grasshopper fable.
Horatio Alger stories.
The American Dream.
So many of our financial maxims rely on the idea that hard work leads to success. But a recent feature in the New York Times, entitled “Americans Want to Believe Jobs Are the Solution to Poverty. They’re Not, challenges that premise.
The article uses one woman’s compelling story to show how difficult it is for the working poor to move out of poverty and financial insecurity. The woman, who works in home healthcare, cobbles together as many hours as she can at her job. She raises several children, spending any money she gets on food and trying to save up enough to buy her family basic necessities like towels. And, on numerous occasions, she has to sleep in a car overnight with her family because she’s a member of the “working homeless.” The story is harrowing, difficult to read, and—unfortunately—not uncommon in our country today.
For financial educators, the story provides three lessons that should be imparted to students, likely as part of a broader module on careers and earning.
(1) Getting a job is not enough to secure a decent living. Many students errantly believe that all they need to do after high school is get any job, and they’ll be fine. But, as the article points out, worker wages have not risen in line with actual productivity for 40 years. Low-wage jobs like healthcare worker, daycare worker, grocery store employee, or customer service representative do not provide enough hours or pay for a person to build a stable life.
(2) The social safety net is the only thing keeping many working poor afloat. Whether you agree politically with how the United States government administers a social safety net, the article makes a compelling case that social aid programs (like public housing, SNAP, and the earned-income tax credit) are all that keep many working poor out of abject poverty. Students should learn about the role such programs play in our society, including their limitations and prospects for lifting people out of poverty and how such programs can be used in times of financial distress. As they move into adulthood, students should develop their own evidence-based opinions on the effectiveness of these programs and how they can be structured to promote greater economic opportunity and security for all.
(3) Stereotypes about the poor are untrue and hurtful. The article provides interesting statistics on poverty that dispel many myths about the poor. They work. They want to work more than they are offered. They appreciate their jobs and care deeply about their children and families. They don’t want to be on public services and don’t stay on them if they don’t have to.
In working with students who come from various economic backgrounds, it’s important for us to walk a careful line: teaching ways a person can improve his or her financial well-being, while also noting that a person’s financial standing is not a sign of their virtue. When teaching about jobs, a good way to do this is to acknowledge and respect the hard work of people in low-wage jobs, while helping students learn about and plan for jobs with more security and higher wages.