The Job Gap in Pennsylvania: Are There Enough Living-Wage Jobs?

By Howard Wial

Many Pennsylvanians today believe that anyone who looks hard enough can find a "living-wage" job—a job that supports a family at a minimal but adequate standard of living. This report shows that this belief is wrong.

Even with unemployment near its lowest level in a quarter century, there is a shortage of jobs in Pennsylvania and a severe shortage of living-wage jobs. These shortages are especially acute in the Philadelphia metropolitan area.

Work requirements and time limits on benefits imposed as part of welfare reform will continue to increase competition for living-wage jobs, making the shortages of such jobs more severe.

For the entire state of Pennsylvania and for four major geographic regions, the report shows:

• how much a living wage is, based on what it costs to cover a basic needs budget (which includes rent, food, child care, transportation, medical care, miscellaneous expenses, and taxes),
• how many Pennsylvania workers now have living-wage jobs,
• how many living-wage job openings exist per year,
• how many living-wage job-seekers there are per year, and
• how many people are competing for each living-wage job opening.

The report uses living-wage estimates for three different kinds of families: a one-adult family with one infant and one preschooler, a one-adult family with one school-age child and one teenager, and a two-adult family with one infant and one preschooler in which both parents work.

In Pennsylvania as a whole, a living wage varies by region and family type but is always higher than the official federal poverty level.

57 percent of all currently occupied jobs pay enough to cover a basic needs budget for a family of one adult, one school-age child, and one teenager.

A slightly smaller share of job openings, 53 percent, pay enough to cover a basic needs budget for such a family.

Using a conservative estimate of the number of people who are competing for living-wage jobs, there are at least 4.4 job-seekers for every open job that pays a living wage high enough to support a family of one adult, one school-age child, and one teenager.

There are at least 2.3 job-seekers for every open job regardless of wage.

Regional Findings
In the Philadelphia metropolitan area, including counties in both Pennsylvania and New Jersey, a living wage for a family of one adult, one school-age child, and one teenager is $12.29 per hour or $25,566 per year (in 1998 dollars), higher than in any other region of the state.

52 percent of all jobs currently held by residents of the entire metropolitan Philadelphia region, but only 44 percent of jobs held by residents of the City of Philadelphia, pay a living wage high enough to support a family of one adult, one school-age child, and one teenager. These percentages are lower than those for any other region of the state.

49 percent of job openings pay enough to support a family of one adult, one school-age child, and one teenager. This percentage is lower than that for any other region of the state.

There are at least 6.6 living-wage job-seekers for every open job that pays enough to support a family of one adult, one school-age child, and one teenager.

There are at least 3.2 living-wage job-seekers for every open job regardless of wage.

By any definition, the shortages of jobs and of living-wage jobs are greater than in any other region of the state. Even though wages in this region are the highest in the state, they are not high enough to cover the region’s high cost of living. More so than families elsewhere in Pennsylvania, Philadelphia-area families struggle to make enough to cover a basic needs budget.

In the Pittsburgh metropolitan area, including some counties outside Allegheny with a relatively low cost of living:

A living wage for a family of one adult, one school-age child, and one teenager is $9.33 per hour or $19,407 per year (in 1998 dollars).

61 percent of all jobs currently held by residents of the region and 61 percent of jobs held by residents of the City of Pittsburgh pay enough to support such a family.

55 percent of job openings pay enough to support such a family.

Using a conservative estimate of the number of people who are competing for living-wage jobs, there are at least 4.8 job-seekers for every open job that pays enough to support such a family.

There are at least 2.6 job-seekers for every open job regardless of wage.

In metropolitan southern Pennsylvania, including the Harrisburg-Lebanon-Carlisle, York, Lancaster, Reading, and Allentown-Bethlehem-Easton metropolitan areas:

A living wage for a family of one adult, one school-age child, and one teenager is $10.21 per hour or $21,232 per year.

59 percent of all jobs currently held by residents of the region pay enough to support such a family.

54 percent of job openings pay enough to support such a family.

Using a conservative estimate of the number of people who are competing for living-wage jobs, there are at least 2.6 job-seekers for every open job that pays enough to support such a family.

There are at least 1.4 job-seekers for every open job regardless of wage.

By any definition, the shortages of jobs and of living-wage jobs are smaller than in any other region of the state but are still substantial.

In Pennsylvania’s smaller metropolitan areas and nonmetropolitan areas:

A living wage for a family of one adult, one school-age child, and one teenager is $8.83 per hour or $18,361 per year, lower than in any other region of the state.

59 percent of all jobs currently held by residents of the region pay enough to support such a family.

54 percent of job openings pay enough to support such a family.

Using a conservative estimate of the number of people who are competing for living-wage jobs, there are at least 3.7 job-seekers for every open job that pays enough to support such a family.

There are at least 2.0 job-seekers for every open job regardless of wage.

The shortage of living-wage jobs is a bigger problem for less educated workers than for Pennsylvanians as a whole.
The vast majority of managerial and professional occupations, which account for about 39 percent of living-wage job openings in Pennsylvania, are unreachable for workers with a high school diploma or less (using a living wage high enough to support a family of one adult, one school-age child, and one teenager). So are many craft and technical jobs.

For those coming off welfare, the implications of this report are bleak. These people have very little chance of landing a job that pays well enough to cover a minimally adequate basic needs budget.

Until we put in place policies to increase the number of living-wage jobs, the promise that welfare reform will lead to self-sufficiency will remain hollow.

This document is an on-line summary of a Keystone Research Center report. The entire report is available for download as a PDF file at the KRC Web site www.keystoneresearch.org © 2001 Keystone Research Center