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Wednesday, Jan. 22, 2014

Yes, The War on Poverty Has Helped Women and Their Kids

But our 21st-century economy still doesn't fairly reward women’s work

wendy
Wendy Baumann, WWBIC
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Women are bearing the brunt of the failure to win the War on Poverty. Although poverty in general has shrunk since the 1960s, women are more likely to be impoverished than men, and women of color are more likely to be poor than white women and men, according to a new report from the Council of Economic Advisors. In fact, of the 100 million Americans who are in poverty or cycle in and out of it, 42 million are women and 28 million are the kids who depend on them.

But don’t blame the safety net programs launched by President Lyndon B. Johnson 50 years ago this month, because Medicare and Medicaid, food and income assistance, Head Start and other initiatives have helped women become more financial secure.

Instead of looking at the public programs that are helping women and kids, female poverty in many ways is driven by the conservative political and business leaders who attack and underfund the public safety net, private-sector jobs that pay women less than men, a minimum wage that perpetuates poverty, and the lack of employment policies that could help women be good employees and take care of their families.

Ken Taylor, executive director of the Wisconsin Council on Children and Families, said the War on Poverty programs reduced poverty, especially in its first decade, but when wages stalled in the 1970s, low-income workers—especially women—were hit hard.

“Low-income workers did not see the benefit of the [rising] economic tide,” Taylor said. “It used to be that low-income workers shared in economic growth. I think the War on Poverty worked. Of course, it could have done more. But it’s other things that have kept the poverty rate as high as it is.”

Laura Dresser, associate director of the Center on Wisconsin Strategy (COWS), said women are more likely to work in occupations with inadequate worker protections and must rely on publicly supported health and child care to survive.

“The bottom line is that these social programs are pushing against a labor market that doesn’t have very many supporting standards and much job quality,” Dresser said. “In some ways, you can think of these programs as subsidizing low-wage employers to make it possible for workers to get by in these jobs.”

Advocate Ellen Bravo, of the Family Values @ Work coalition, was more blunt about how employers take advantage of the taxpayer-subsidized programs that low-wage workers must rely on to survive.

“Let’s call it what it is—corporate welfare,” Bravo said.

 

The Gender Wage Gap

It’s no secret that women are paid less than their male peers. According to data presented by the Wisconsin Women’s Council, in 2011 women in Wisconsin earned on average 78 cents for every dollar earned by a man. But not all women are alike. While white women earn 80 cents for a man’s dollar, women of color earn far less—African American and Asian women earn 66 cents, Native American women earn 60 cents and Latinas earn 58 cents per male dollar.

Conventional wisdom argues that this is because women are more likely than men to work part time, leave the workforce to raise children or work in occupations that pay less than traditionally male jobs. But the data show that women are earning less than their male peers even when they’re working in traditionally female occupations—such as education—and women earn less even in those jobs that pay women the highest. [See sidebar.] Women with advanced degrees also earn less than their male counterparts.

Raising the minimum wage would help—but not solve—the gender wage gap. Almost two-thirds of all minimum-wage workers are women, especially those who work in the caregiving professions, fast-food industry or service industry. But even working full time at a minimum-wage job will keep women and their families mired in poverty.

This persistent wage gap over the course of a woman’s career has a cumulative effect that has to be acknowledged, said Christine Lidbury, executive director of the Wisconsin Women’s Council.

“Lower earnings don’t only disadvantage women and their families when they’re employed, but if they become unemployed they have less unemployment insurance, they have lower benefits, it affects their pensions, their Social Security, all those kinds of things,” Lidbury said. “If you have a lower wage to start with it has a huge impact all the way down the line. It also affects your ability to move and gain new employment, especially in a tough economy.”

Equal pay would stimulate the economy, too. If men and women were paid equally, the U.S. economy would produce $447.6 billion in additional income, according to research from the Institute for Women’s Policy Research.

Equal pay laws—including the Equal Pay Act of 1963 and the gender protections included in the Civil Rights Act of 1964—are supposed to provide women with more rights in the workplace. But enacting—and retaining—these laws isn’t easy. The first bill Barack Obama signed into law as president was the Lilly Ledbetter Fair Pay Act, which enhances the ability of victims of wage discrimination to sue unfair employers. But Wisconsin’s version hasn’t fared so well. The Democratic-led state Legislature enacted the Equal Pay Enforcement Act in 2009, when Jim Doyle was governor. But with the support of Wisconsin Manufacturers and Commerce and the Wisconsin Restaurant Association, Republicans and Gov. Scott Walker repealed it in 2012, making it harder for victims of wage discrimination to make their case in court.

 

A Woman-Friendly Workplace

Wages are only one component of a worker’s compensation, of course. Workplace standards and policies have a huge—and typically adverse—impact on women as well.

Topping the list of women-friendly changes that need to be implemented are paid sick days and family leave policies, especially for low-wage workers, said Bravo.

“If you make minimum wage and you lose money when you’re sick, you are in fact earning sub-minimum wage,” Bravo said. “We need to make employment a way out of poverty, not just another form of it.”

Yet fewer than 30% of low-wage workers get paid sick days at all, according to The Shriver Report: A Woman’s Nation Pushes Back from the Brink. That means that low-wage women workers must choose between earning a day’s pay and taking care of their child, parent or themselves.

“There’s a lot of what sociologists call job churning and what we call getting fired or disciplined because you’re being a good parent or following doctor’s orders,” Bravo said. “It really hurts when you have shorter job tenure. It actually lowers your pay. You start to have a patchy résumé and people think you have a bad work ethic when in fact you’ve been a responsible parent or child to your own parent or taking care of yourself. It becomes a vicious cycle. You can’t get a better job and then all of these things happen when you fall behind.”

Milwaukee voters overwhelmingly supported a paid sick day ordinance in 2008. But the Republican Legislature and the Metropolitan Milwaukee Association of Commerce overrode the ordinance at the state level, disregarding the will of Milwaukee voters and undermining local control.

 

Becoming the Boss

For some women, especially women of color, starting a business is a way to become more financially secure. According to data from the Association for Enterprise Opportunity, “microbusinesses”—small businesses with fewer than five employees, including the owner—can have a huge impact on a woman’s earnings, as well as the national economy. The association’s recent study found that microbusinesses employ 26 million people nationally and added 1.9 million indirect jobs and 13.4 million induced jobs in 2011.

About a third of all American microbusinesses are owned by women, whether it’s a home-based, part-time business that allows them to supplement other income or a full-time small business poised for growth. Every female microbusiness owner may not become rich, but wages are often double the minimum wage and provide a sense of security and independence during a stagnant economic recovery.

Setting up a business is never easy, but the barriers to a lower-income woman starting a microbusiness can often be overcome with a lot of hard work because it doesn’t require a college degree or much seed capital or resources.

That said, women, especially women of color, may need extra help when launching their own business, since banks are often reluctant to lend to a start-up, especially a start-up headed by a new entrepreneur.

Enter the Wisconsin Women’s Business Initiative Corp. (WWBIC), which has more than 25 years of experience in fostering business ownership among women, minorities and low-income Wisconsinites. Wendy Baumann, WWBIC’s president and chief visionary officer, said the organization had a banner year in 2013: “The most clients. The most loans. The most individuals in business. The most business started. The most people helped in an economic way.”

WWBIC’s 2012 data show that 68% of its clients are low-to-moderate income, 73% are women, 54% of its clients across the state are minorities, 76% of its Milwaukee clients are minorities, 73% are exploring or starting up businesses, and 27% are existing businesses that want to expand.

Baumann said that while female workers have made great strides since the 1960s, “There still is huge inequity. Inequity with equal pay, when we look at women and the number of businesses there are, and the contracts they receive, inequity in terms of access to capital issues.”

She said she hoped that WWBIC’s services wouldn’t be needed 25 years from now because women- and minority-owned businesses wouldn’t face discrimination from lenders. But that can only happen if working men and women advocate for fair wages and workplace standards in a 21st-century War on Poverty.


Wisconsin Women’s Work Is Undervalued

For each $1 earned by a man in Wisconsin, his female peer earns:

 

White women: 80 cents

African American women: 66 cents

Asian women: 66 cents

Native women: 60 cents

Latinas: 58 cents

 

Education doesn’t erase the gender gap.

High school diploma: 75 cents

Bachelor’s degree: 80 cents

Advanced degree: 89 cents

 

Women earn less in the highest-paying occupations for women.

Computer and mathematical: 91 cents

Agriculture and engineering: 87 cents

Management: 79 cents

Legal: 55 cents

Health diagnosing and treating practitioners and technical: 50 cents

 

Women earn less in fields dominated by women.

Office and administrative support: 82 cents

Education, training and library: 82 cents

Personal care and service: 73 cents

Health technologists/technicians: 71 cents

Health diagnosing and treating practitioners and technical: 50 cents

 

—Sources: Wisconsin Women’s Council, Center on Wisconsin Strategy (COWS)

 

Woman Up! Festival

Join the Shepherd Express at the Woman Up! festival on Saturday, Feb. 8, at the Wisconsin State Fair Park Expo Center. There will be speakers, demonstrations and interactive panel discussions, as well as fun, food, wine, chocolate and products and services from 200 vendors.