Not that long ago, Alex Caicedo was stuck working a series of odd jobs and watching his 1984 Chevy Nova cough its last breaths. He could make $21 an hour at the Johnny Rockets food stand at FedEx Field when the Washington Redskins were playing, but the work was spotty.
Today, Mr. Caicedo is an assistant manager at a pizzeria in Gaithersburg, Md., with an annual salary of $40,000 and health benefits. And he is getting ready to move his wife and children out of his mother-in-lawâ€™s house and into their own place. Doubling up has been a lifesaver, Mr. Caicedo said, â€œbut nobody just wants to move in with their in-laws.
â€The Caicedos are among the 3.5 million Americans who were able to raise their chins above the poverty line last year, according to census data released this month. More than seven years after the recession ended, employers are finally being compelled to reach deeper into the pools of untapped labor, creating more jobs, especially among retailers, restaurants and hotels, and paying higher wages to attract workers and meet new minimum wage requirements.
â€œIt all came together at the same time,â€ said Diane Swonk, an independent business economist in Chicago. â€œLots of employment and wages gains, particularly in the lowest-paying end of the jobs spectrum, combined with minimum-wage increases that started to hit some very large population areas.
â€Poverty declined among every group. But African-Americans and Hispanics â€” who account for more than 45 percent of those below the poverty line of $24,300 for a family of four in most states â€” experienced the largest improvement.Government programs â€” like Social Security, the earned-income tax credit and food stamps â€” have kept tens of millions from sinking into poverty year after year. But a main driver behind the impressive 1.2 percentage point decline in the poverty rate, the largest annual drop since 1999, was that the economy finally hit a tipping point after years of steady, if lukewarm, improvement.
For the first time since the recession began, the poverty rate fell substantially in 2015. The number of people living under the poverty line declined by about 3.5 million, with every major demographic group benefiting from a stronger economy and an expanding job market. For all the improvement, though, poverty remains deeply entrenched, particularly among African-Americans and Hispanics, and is more prevalent in the South and Southwest.
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