Working poor is a term used to describe individuals and families who maintain regular employment but remain in relative poverty due to low levels of pay and dependent expenses. The working poor are often distinguished from paupers, poor who are supported by government aid or charity.
There are various issues to consider when studying the extent, cause and definition of "working poor" and "working poor" conditions. One such issue is the definition of poverty. Given on a global scale, the definition and requisites to be considered impoverished or in poverty may sharply contrast the conditions of any one specific country. When viewed at a high level, the global definitions of poverty are typically much lower than that of more prosperous countries. In areas such as the United States, England, France and other more prosperous nations, the poverty line is much higher than that of countries with typically lower or even negative economic conditions. When considering localized differences, such as in the United States, differences in market rates of goods and services may impact the effects of poverty.
Yet another consideration to be made with a global view is data collection and reporting methods. With no globally accepted standards on data recording and reporting, variances may be obscured, omit or inflate specific factors considered in determining poverty levels or measures of the working poor.
In the USA and Canada a person is generally recognized as being working poor depending on their revenues compared to an absolute poverty level. Officially, in the United States, the working poor are defined as individuals who spent at least 27 weeks in the labor force (working or looking for work), but whose incomes fell below the official poverty level. Often, those defined as "working poor" have negative net worth and lack the ability to escape personal and economic contingencies. Canada has no official poverty line, although, statistics Canada's Low Income Cut-Off (LICO) is typically used in discussions by academics and community activists, despite Statscan’s frequent disclaimers to the contrary.
In the European Union a person is working poor depending on his revenues compared to a relative poverty level. Eurostat defines this level at 60 percent of the median income. The minimum wage can also be used as the threshold.
The nature and extent of the working poor in the United States is a contested subject; while both sides of the political spectrum acknowledge that there are non-negligible numbers of working people living near or below the poverty line, there is disagreement as to whether or not this reflects a genuine flaw with current economic policy, and what the response should be.
In the United States, according to the government Bureau of Labor Statistics, there were 6.4 million working poor in 2000; by 2003 the number had grown. In 2004, Business Week suggested that "the share of the workforce earning subpoverty pay [is] 24% [in 2003]".
Different numbers were found by The Working Poor Families Project, a national initiative that examines the conditions of working families both nationally and at the state level. In 2005, using U.S. Census American Community Survey data, the project found that 2.8 million working families are poor (earn less than 100% of poverty) and that these families constituted 12.2 million people. In addition, 9.6 million, or more than 1 out 4 working families in America (29%), are low-income, earning less than 200% of poverty. The 200% of poverty threshold is considered a reasonable estimate of the amount of earnings needed to be economically self-sufficient ($39,942 for a family of four in 2005). Among states, the range for low-income working families extends from 15% (New Hampshire) to 42% (New Mexico).
The question of the working poor, how many there are and the reasons for their situation, remains controversial. For example, the Business Week magazine article cited above, which was generally critical of the political response to the problem of the working poor, itself received criticism from Townhall.com columnist Thomas Sowell, who claimed that the magazine had, among other sins, inflated statistics.
Sowell claimed that "census data show that most people who are working are not poor and most people who are poor are not working", and that workers who were part-time or under the age of 25 should not be counted as working poor. Citing the author Horatio Alger, Sowell suggested that the intelligentsia had dismissed words such as moxie and gumption, and that the working poor themselves, and not larger socioeconomic factors such as the lack of labor unions and the changing nature of employment, as suggested by Business Week, were to blame for the situation.
The working poor in France are women in 80 percent of cases.
Workers without marketable skills may face low wages, potential economic exploitation, unpleasant working conditions, and few opportunities to attain skills that would allow them to escape their personal and economic situations. Unexpected costs (such as medical or repair costs) can substantially decrease the economic ability of the working poor to manage their lives.
In some cases, members of the working poor work at multiple part-time jobs, which require nearly full-time commitment but are classified as "part time". In this situation some benefits, like medical insurance, are not paid by employers . This situation is sometimes referred to as precarious employment. These workers are more often than not without adequate (or in many cases any) health insurance.
A common expression of working poor conditions states that such individuals often live from "paycheck to paycheck".
Many governments have initiated programs with the proclaimed intention of assisting those who may be considered impoverished or working poor. Much debate is centered upon the efficacy of such programs.
In the United States, fiscal conservatives tend to argue in favor of the approaches recommended by Trickle-down economics, in which stimulation of the investment sector is assumed to lead to increased job opportunities and a better economy. Examples of conservative measures include lowering taxes and reducing governmental regulation of business and trade. Fiscal progressives tend toward a more direct approach, usually with increased taxes and regulation. The government funds social welfare programs like food stamps and vouchers, subsidized housing, meal plans, and healthcare, and regulating wages, or by helping the working poor become more competitive in the labor market, through such measures as job training programs, low-interest student loans, and small business loans.