Part II: Factors Contributing to the Current Situation The View from the Field

Transcription

1 Part II: Factors Contributing to the Current Situation The View from the Field The General Economy Virtually all of our key informants noted that the post-2008 economic environment had complicated the already difficult task of moving families to increased financial stability. The recession and accompanying loss of employment for several thousand families in the region has impeded the community s ability to help families achieve financial stability. Recessions and rising unemployment always negatively impact portions of the community, but the most recent case has proven to be deeper, broader and more persistent. Recent data suggests improvements in the employment situation, but it will take some time before conditions return to those of the early years of the decade. As structural shifts in the economy are occurring at the same time as the recessionary impacts, it is difficult to determine with any certainty whether some aspects of the current situation are the new normal in terms of higher unemployment, lower wages and reduced benefits. The last few years have brought increases in "situational poverty," poverty resulting from an incident (or succession of incidents) in the lives of an individual or family. The loss of employment or other substantial reduction in household income can be such incidents. When unemployment is prolonged and any savings are used up, even a minor incident can produce an economic crisis for a family. People facing poverty for the first time in their lives (and lacking knowledge of governmental or private assistance options) was a recurring theme heard throughout the research for this report and for recent community health research. A second theme that emerged also relates to job losses suffered by those who had heretofore been relatively stable financially in the middle class. As workers with at least some skills and with employment experience shift their sights lower in an effort to find work, they are creating downward pressure on the least skilled and the inexperienced by competing successfully for jobs formerly available to lower skilled workers. As is suggested in the above paragraph, many displaced workers are finding employment lower on the salary scale (and likely lower on the skills scale also) than they had experienced in their previous employment. Some of the key informants interviewed suggested that this might not be a temporary situation for a large number of these workers without significant efforts on their part to acquire new skills, even for positions in the same sectors they had left. The Skills Gap Some in the business and workforce development communities note that there are jobs in the community at wages above entry level but the employers seem to have difficulty finding qualified applicants. When this subject is pursued it becomes clear that getting more students through high school will not be enough. Some training beyond high school, though not necessarily a four-year degree will be part of the solution. As is apparent in the data presented above, education is the one undeniable component for improved financial stability. Page 33

2 But other skills are often mentioned as even more critical. Some representatives of business suggest that they can often provide necessary technical skills. What seems to be lacking, often called soft skills are not so readily available. Some may only be acquired by work experience, but employers want workers to show up with skills such as knowing how to relate appropriately to customers, co-workers and supervisors. Basic behaviors that might have been described in the past as exhibiting the work ethic are seemingly also in short supply. Arriving on time, coming to work every day and staying a full day are often identified as missing skills. Key informants who work with the unemployed to prepare them for better opportunities echo many of these concerns. According to them, there are significant numbers among those they assist who have had no or so little previous meaningful work experience and lack many of these basics. Further Barriers Child care There are approximately 30,000 families in the 8-county region with children under age 5, headed by a single parent. About half of them have incomes that place them below the poverty line. There are an additional 60,000 married couple families with children under age 5, and about 5,000 of them are under the poverty line. Particularly for the single-parent families, access to some form of child care is critical to their ability to work full-time in order to earn enough to approach financial stability. A significant portion of children in two-parent households are cared for by one of the parents, possibly as many as thirty percent. Of course many families, single and 2-parent, depend on family and friends to care for their children at little or no cost. While a sound financial arrangement, it often results in the children missing out on the developmental opportunities available in quality licensed child care centers. Child Care Development Fund (CCDF) vouchers provide a valuable source of support for low-income families, although there are not enough of them to meet the need. The current waiting list is over 2,000 eligible families in Marion County alone. Even this assistance does not guarantee quality care as licensure or other quality standards are not a requirement for acceptance of the vouchers. For those who do receive the vouchers it is a significant economic benefit. On average during 2011, around 10,000 children in UWCI s area benefitted from voucher assistance. The income limit varies from time to time, at the present eligibility ends at about $39,000 for a family of four. At that income level, family would pay a co-pay of between $76 and $133 (total) depending on how long they had been in the program. At the eligibility limit, the benefit stops and the family would immediately shift from paying about 18% of the cost (at the highest level) to 100%. Up until the top of the scale the benefit reduces gradually. At the limit, however, there appears what work-force development staff sometime refer to as the cliff effect. While it is obvious from a policy perspective why there needs to be a reduction in benefits, the abrupt cutoff could serve as a disincentive to take a new position with even a slightly higher pay rate if it meant the immediate addition of at least $300 or so dollars in increased child care costs or the need to seek a lesser quality alternative. Page 34

3 Transportation The majority of the region s low income population and a large proportion of those at lower levels of education and skills live in the central part of Marion County. Over the past several years employment opportunities for which this population might be suited have tended to develop on the periphery of Marion County around Interstate 465 and farther into the surrounding counties. This has been particularly true in the cases of warehousing and large scale retail. The spread of hospitals and other health care providers beyond Marion County has also dispersed employment. The following map provides one view of the situation. Although it is clear that there are substantial numbers of jobs held be workers with a high school education or less distributed throughout the region, there are significant concentrations aligned with Interstate 465 and the radial interstates and major highways. In the absence of a regional transit system that connects workers to available job locations, workers in this category will almost certainly need to rely on personal transportation. Workers in Jobs Who Have High School Education or Less 2010 Source: Census Bureau/Unemployment Insurance Records Page 35

4 In a similar fashion the map below shows the distribution of jobs paying between $1,251 and $3,333 per month, these are the most likely job opportunities for those with fewer skills and less education. Workers Earning Between $1,251 and $3,333 per Month Source: Census Bureau/Unemployment Insurance Records Several comments from key informants focused on the lack of a truly viable public transit system as a significant barrier to increasing the number of families achieving financial stability. They stressed the need to support efforts to make more jobs accessible to more workers. Page 36

5 Criminal history The great majority of families in Central Indiana who work hard to achieve financial stability for themselves and their families avoid the criminal justice system. However, for men under age thirty, not finishing high school increases the odds of a criminal history by more than a factor of three compared with those who complete high school. 4 If the young man is Black, the odds double again. Among those who fail to complete high school are many of the 7,000 individuals released annually from the Department of Corrections to return to Central Indiana. Within three years of their release, thirty to forty percent will have returned to the correctional system, something less than half of that group having committed and been convicted of another offense. Education data is not readily available regarding inmates of Indiana s correctional facilities, but national estimates run to as high as 75% not having completed high school at the time of their confinement. Although there has been some success lately in providing additional GED opportunities in Indiana s prisons (sometimes as many as 1,000 per year), there has also been a budgetary reduction that limited funds available for post-secondary education. An Indiana Department of Correction study in 2008 found that education and employment were the two main predictors for recidivism. Students without a high school diploma or GED were about twenty percent more like to return to prison as were those with a diploma. When employment is factored in, the difference is even more pronounced. An individual with no high school and without a post- prison job had a return rate of 44.7% compared with 23.4% for someone with a high school diploma and a job. For those with education beyond high school combined with a job, the return rate was under 20%. According to our respondents, many, if not most, employers are hesitant to hire or even interview an individual who has a record of a felony conviction and time in prison. For some employers and occupations there is no choice; regulations and licensing procedures limit the options. For most employers, however, the decision to exclude ex-offenders is more likely based on a conclusion that an across-the-board exclusion is more efficient that an attempt at one-by-one risk assessments. A perceived danger to employees and customers and the accompanying liability makes the simplest approach the more appealing. Representatives from several of the Centers for Working Families sites estimated that from thirty to fifty percent of their clients had some type of involvement with the criminal justice system that could be a barrier to meaningful employment. Although there are legal steps that can be taken after a time that reduces the amount of information available, it can be years before anything can be done and the exoffenders are not always aware of the possibility. Further complicating successful reentry (which must be built on obtaining employment) is the high rate of past substance abuse among the ex-offender population. Here, also, the estimate is as high as 75% abusing some sort of substance, including alcohol. Substance abuse programs within the system and available upon release have some impact but even for those not suffering from addiction, frequent abuse and a positive drug test are high barriers to employment. 4 An Assessment of the Labor Market, Income, Health, Social, and Fiscal Consequences of Dropping Out of High School: Findings for Illinois Adults in the 21st Century, Center for Labor Market Studies Northeastern University, Page 37

6 It is important to make clear that not all of those involved in the criminal justice system have engaged in substance abuse, nor are all who have engaged in substance abuse are going to go to prison. However, as some of the key informants noted, even so-called recreational use, if revealed by the increasingly common employment drug tests, can mean not getting or not keeping a needed job. Culture of Acceptance Conversations with representatives of the Centers for Working Families introduced another potential barrier to success that some may find controversial. They observed that, for some who are the latest among multiple generations in the same or similar place in society, this lack of any movement seems to have engendered a belief that not only is the current situation as good as it is going to get and the way it has always been, but that it is the way things are supposed to be. Many in any society may believe the latter about their own situation at the middle or upper reaches of the socio-economic scale, such a belief might even be comforting. However, at the lower end of the ladder such a belief can be both incapacitating and self-fulfilling. Our respondents acknowledged that their observation is just that, an observation. However, they expressed the concern that even if this culture of acceptance is not wide-spread, where it is present it adds another complication to attempts to bring financial stability to more families. The workers in the Centers know that it takes discipline and a belief in better things ahead to motivate people to improve their education, apply for jobs in the face of repeated rejection, and spend carefully and save in order to build financial assets. Page 38