Kansas’ Job Growth: Path to Prosperity or Detour to Poverty?

Oct. 29, 2014

It’s nice to be in Kansas, where we enjoy pretty low unemployment. Knowing that more people are working is a hopeful sign of economic recovery. But low unemployment doesn’t mean everyone has good jobs. Many of the fastest growing jobs in Kansas pay wages that keep a family below the poverty line. Low-wage jobs and declining revenues because of the 2012-13 tax cuts limit the amount we can invest in our state. This leaves many hard-working Kansans with less access to vital services, like health care and a quality education, which they need to become economically secure. We have to ask ourselves: What kind of recovery are we getting – one putting us on the road to prosperity or a detour to poverty?

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As mentioned above, a sinking unemployment rate in and of itself is often a good thing. Since 1989, Kansas has had an unemployment rate lower than the nation and on par with our neighbors. Our unemployment rate continues to drop, along with other states in the region and the United States as a whole. But our neighbors are getting a better deal than Kansas is. They didn’t cut taxes to get their people back to work.

Even the falling unemployment numbers have a cloud cast over them. A big reason the unemployment rate is dropping is because people are getting jobs that pay wages that keep them in poverty. Of the top 25 fastest growing jobs in Kansas, 10 of them pay wages that would leave a single mother or father unable to pay for food, utilities, transportation and child care without help. We were promised growth with the tax cuts, but much of this growth is coming in jobs that pay people poverty wages.

Those working in these fast-growing low-wage jobs aren’t a small part of our workforce, either. More than 25 percent of working Kansans are employed in these 10 types of jobs. With state revenues coming in lower than projected, we’re looking at having to make cuts to education, public health and transportation. These investments are a proven path out of poverty and cuts would directly affect full-time working Kansans.

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Kansas’ growth in low-wage jobs makes our budget problems worse, too. With a lot of low-paid workers, we have less revenue to collect to make investments that benefit the entire state’s economy. The revenue collection numbers show this is likely the case. Compared to the same period last year we’ve collected $51 million less from individual income taxes. This source of revenue that brings in more than 40 percent of the dollars Kansas uses to hire teachers and keep our communities safe and healthy. This creates a vicious cycle. Low-wage jobs bring in less revenue to keep up with the increasing costs to necessary programs like Medicaid all while these low-wage workers and their children need these services since their jobs don’t pay enough for them to afford health insurance.

Kansas now finds itself in a similar position to the people working poverty wage jobs growing so fast in the state. With less income spending will have to be cut or reduced to make ends meet. We may have to put off doing things that need to be done, like expanding Medicaid and early-childhood education, simply because we can’t afford them.

Though our unemployment is rate going down, it’s because many are working in low-wage jobs. Meanwhile we are unable to reinvest in the people, schools and communities because of unnecessary and ineffective tax cuts. Kansans are renowned for their common sense and common sense says these tax cuts aren’t working.

KendraKansas’ Job Growth: Path to Prosperity or Detour to Poverty?