Thursday, August, 27, 2015

Thursday, August, 27, 2015

“A tale of two recoveries”; Licensing reform could boost economic mobility; TANF dollars should do more and; Poor school districts gaining population

“A tale of two recoveries”

The weeks leading up to the tenth anniversary of Hurricane Katrina have been full of articles, studies and conferences–most heralding the resilience of New Orleans and the progress made. But it is a complicated story, as evidenced by a new report from the Urban League. The report found black and white New Orleanians have had very different decades, according to the Advocate:

 

Ten years after Hurricane Katrina, half of New Orleans’ working-age black men are unemployed. Median income for black New Orleanians is about $25,000 a year, not much better than it was before the storm, and far behind the $60,000 average income of white residents. And the gap has gotten bigger, not smaller, in the past decade…Sixty percent of white people in New Orleans hold management positions, more than twice the 27 percent rate for black people. Only 17 percent of area businesses are owned by black people, and just 4 percent of those businesses have any paid employees. One bright spot is an increase in disadvantaged business participation at the city’s public schools.

While 88 percent of the city’s housing units have been restored, affordability and quality continue to be significant challenges, particularly for black residents. Based on the available data, the report says, a lack of affordable housing, limited resources for rebuilding and discriminatory housing practices are barriers to recovery for African-Americans…Also, rent in New Orleans has soared, going from an average of $488 per month before Katrina to $926 today…African-Americans were the least likely to return to the city after the storm, with 54 percent returning compared with 89 percent of white residents. For those who did return, federal funds designed to help them rebuild have been unequally distributed.

 

Licensing reform could boost economic mobility

Reforming occupational licensing is a key component to providing young adults from poor families an opportunity to move up the income ladder, according to a report from the Council of Economic Advisors (CEA). With half of all “middle skill” jobs–those that require more than a high school diploma, but not a four-year college degree–require licensing, it is important to ensure that restrictions on acquiring licensure do not become an insurmountable barrier. The Brookings Institution’s Ron Haskins summarizes the recommendations nicely:

 

With stakes like these, the report’s recommendations bear special emphasis. The most important of these recommendations are to limit licensing to situations in which there are serious public health and safety concerns, to use benefit-cost analysis in every case possible to determine if proposed licensing requirements produce benefits that at least equal their costs, to avoid licensing if the net benefits are negative, and to figure out ways to encourage states to harmonize their licensing requirements with those of other (specially adjacent) states. That last requirement is important because states have licensing requirements for well over 1,000 occupations, which could constitute a barrier to workers crossing state lines to pursue employment opportunities—even within the same profession. If followed, these four recommendations could help open up new job possibilities for modestly educated and trained workers, increase the wages of these workers, and reduce the price of items used by consumers—a fine trifecta of benefits.

 

TANF dollars should do more

Liz Schott of the Center on Budget and Policy Priorities has several recommendations for reform to Temporary Aid for Needy Families – the official name for the program that sends federal dollars to states to help families in need. Rick Cohen with  Nonprofit Quarterly reports on a just a few of the recommendations that could help families better succeed in the job market:

 

  • “Shift the focus from engaging recipients in activities to improving employment outcomes.” By this, Schott is referring to the generation and use of measures that look at whether TANF recipients participate in activities that help them get and keep jobs, not simply whether they are simply engaged in a requisite number of hours in employment-related activities.
  • “Put basic education and skills training on par with other work activities.” Schott observes that “many TANF recipients lack basic skills and education to compete in today’s labor market”—that is, the skills that employers need…
  • “Support alternate pathways to work for individuals with the greatest barriers.” By this, Schott is recognizing that “many TANF recipients face significant barriers to employment, including mental and physical health issues that limit their employment prospects,” but there is little in TANF that addresses their personal or family issues.

Poor school districts gaining population
Citylab.com reports that the number of children living in poor school districts has grown dramatically, especially in the Midwest and the South, due largely in part to the Great Recession. A trend made even more disturbing by the fact that often times poor school districts spend an average of 15 percent less per student than do wealthier districts. Here are the numbers:

 

For parents with multiple kids under one roof, being poor has a compounding effect. That’s why in America, children make up 23 percent of the population but 33 percent of all people in poverty. If that isn’t staggering enough, those children are concentrated together at school. 25 percent of the nation’s school districts contain 82 percent of children living in poverty. And the communities defined by those districts have swollen since the Great Recession. In 2006, there were 15.9 million students living within school districts where the overall child poverty rate was 20 percent or higher. In 2013, there were 26.3 million—a stunning 60 percent increase over just seven years. Now, that doesn’t meant that all 26.3 million of them are living in poverty, or even attending public school. But it does mean that about half of all U.S. children live in places where a significant number of families are just scraping by.

 

Number of the Day:

$16.5 billion – The annual amount of federal funding for TANF which has been frozen since 1996 and as a result has lost one-third of its value due to inflation (Source: Nonprofit Quarterly)