You may not want a pay raise in Eagle Co.
Vail, CO Colorado
EAGLE COUNTY, Colorado ” Eagle County may be one of the worst places in the state for a single mother to get a raise.
A 2007 study done by Columbia University and the Women’s Foundation of Colorado looked at how much it would cost for families and individuals to meet their basic needs without public or private assistance and compared that to how much people actually make in 7 Colorado counties, including Eagle County.
The study identified the “Cliff Effect,” or situations where a raise can result in lost benefits, leaving the family or person worse off financially or only in a marginally better situation.
Many families on the lower end of the pay scale qualify for public assistance like food stamps, Medicaid and child-care assistance. But even a small increase in earnings can result in the loss of those benefits. That sudden drop in income is the “cliff.”
For example, when a single parent with two children gets a raise from $10 to $10.50 an hour, they will lose $2,500 in food stamps. As their wages increase, they will encounter a series of such “cliffs” with the loss of other benefits before becoming economically independent.
“As they earn more, they lose these benefits, but not on a sliding scale, it’s a drop off,” said Jody Camp, director of programs at the Women’s Foundation, an organization that, through grants and advocacy, works to move women and girls toward economic self-sufficiency. “It’s a disincentive to try and move ahead for folks on the lower end of the pay scale.”
Of the counties studied, Eagle County had the steepest drops and showed the largest gaps between the amount families made and how much it costs to live here.
Most other counties studied, families earning between minimum wage and $18 an hour were able to make enough to cover their basic needs at some point. In Eagle County, families in that income range never came close.
A single parent with a young child needs to make at least $21.83 an hour to meet the family’s basic needs. A single parent with two children needs to make $28.59 an hour.
And those are very conservative estimates, adds Camp.
Eagle County’s discrepancies are probably caused by the high costs of living, including rent and child care, she said.
The study’s “self-sufficiency standard,” an estimate of how much it takes to meet basic needs is different from the state’s poverty level. It is calculated based on what it would take to be economically independent, includes costs like school supplies, minimum nutrition standards, and assumes people are working full-time jobs.
“The state poverty level is a farcical number. You can’t live on it. The self-sufficiency standard takes into account different counties and different family types,” said Women’s Foundation President Gretchen McComb.
Single parents are usually hit hardest by the Cliff Effect, she said.
According to the study, 20 percent of the state population lives below the standard, and 54 percent of those are single mothers.
The surprising thing is that many of these people have college degrees, McComb said.
“It’s not just people without a high school education. So many people with a college education are living below self sufficiency,” she said. “These are people with year-round, full-time jobs.”
Possible solutions include raising maximum income limits for government programs, or creating a more gradual decrease in benefits as wage goes up, the study said.
Making the process of receiving benefits less complicated and difficult will also help, as well as getting employers to pitch in and offer help with child care or health benefits, the study said.
The study was presented recently to a group of women from various Eagle County organizations and non-profits. The idea is that they will take the information and tell their local governments, businesses, community organizations and political groups.
“This has been recognized across the county, but no one has really quantified it until this study,” said Edwards resident Kathleen Eck, trustee member of the Women’s Foundation. “We can’t facilitate change until we know what the problem is.”
Beth Reilly, manager of the Eagle Care Clinic in Edwards, said she often sees patients struggling with the “Cliff Effect,” but had never heard it named or studied until now. The clinic treats uninsured or underinsured patients in the county.
“There are more and more folks who can’t afford health insurance, and end up coming to our clinic,” she said.
She was most struck by how big the gap was between what most single parents make and how much they would have to make “break even” in the county, she said.
“If a single parent is making $20 an hour here, they’re still not making it. Folks just can’t get to the break-even line here. We’re the only (county) that didn’t even come close,” she said.
She wants to present the study to elected officials and candidates running for office this year.
McComb said she hopes grassroots efforts like that will result in awareness and eventually policy changes.
“At one point domestic violence didn’t have a name, then someone gave it a name and said, ‘It’s not OK.’ Then legislation was passed. It’s the same with this,” she said.
Staff Writer Melanie Wong can be reached at 748-2928 or email@example.com.
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