Florida ranks in lower third in key categories

By Gary White / The Ledger

Florida seems to lead the nation in generating headlines about dim-witted criminals, comical mishaps and electoral dysfunction.

The state receives less attention for the more serious topic of poverty. But a range of statistics shows economic unease plagues a large swath of the population, casting a persistent financial cloud over the Sunshine State.

In this five-part series, Poverty’s Widening Grasp, The Ledger looks at how poverty affects various aspects of our lives. Florida’s official poverty rate of 17.1 percent in the most recent estimate from the U.S. Census Bureau ranks the state 38th, behind the likes of Michigan and Ohio.

The federal agency’s Small Area Income and Poverty Estimates for 2013 indicate more than 3.2 million Floridians were living below the official poverty line. Federal guidelines define poverty based on income levels ranging from $11,490 for an individual to $15,510 for a couple and $27,570 for a family of five.

Another measure, the Census Bureau’s three-year average from 2010 through 2012, puts Florida’s poverty level at 15.4 percent.

The highest poverty is concentrated in southern and southwestern states, with Mississippi owning the distinction of worst poverty rate at 23.9 percent. New Hampshire had the lowest rate in the most recent estimate at 9 percent.

 

 

Poverty rates vary dramatically within Florida’s 67 counties, from a low of 9.6 percent in St. Johns County to a high of 33.9 in DeSoto County. Polk County ranks near the median at 19.3 percent.

Analysts say several factors influence Florida’s position among the bottom third of states for poverty levels, among them an economy heavily reliant on relatively low-paying service jobs and the construction and tourism industries, which are particularly vulnerable to economic downturns. A shortage of affordable housing is another factor often cited in discussions of Florida’s poverty rate.

Lars Gilberts led an analysis of poverty data for a report published last fall by the United Way of Florida. The report, titled ALICE for “Asset Limited, Income Constrained, Employed,” focused on Florida’s working poor, not just those below the official federal poverty threshold.

Lars Gilberts

Gilberts, the agency’s statewide ALICE director, said he was “dumbfounded” to learn Florida’s poverty rate increased by 4 percent from 2007 to 2012, even as the national economy slowly recovered from the recession of 2008.

“Every metropolitan area we looked at in Florida from 2012 and even now, the poverty levels are increasing,” Gilberts said. “The further we’re getting out of the recession, things are not just automatically getting better.”

Economic security

Florida didn’t fare particularly well in the 2014 Talk Poverty report issued by the Poverty to Prosperity Program, an initiative of the Center for American Progress, a liberal-leaning public policy research and advocacy organization. The group’s analysis found Florida ranked 37th in child poverty, with nearly a quarter of the population in that category.

The report ranked Florida 34th in its rate of working-age women in poverty, 17.8 percent. And it rated Florida 37th in the nation in income inequality.

“When I take a look at Florida, it strikes me that a lot of metrics on which Florida performs particularly poorly have to do with a family’s economic security by comparison to other states,” said Rachel West, a senior policy analyst for the Poverty to Prosperity Program. “Florida is almost dead last in terms of available affordable housing, and the other big one I would point to is health insurance coverage.”

Indeed, the Poverty to Prosperity report rated Florida last in the volume of apartments or other rental units in the state deemed “affordable and available” for households with incomes at or below half of the median level for the area.

Rachel West

The United Way of Florida’s ALICE report also emphasized the state’s dearth of affordable housing. The assessment found that 55 percent of Florida renters live below a threshold of economic vulnerability based on the level of income needed to afford basic household necessities on a county-by-county basis. That was the highest rate for the six states compared in the report (Florida, California, Michigan, Indiana, Connecticut and New Jersey).

The ALICE threshold ranges from $20,000 in annual income to $60,000, depending on family size and the ages of heads of household. In a summary of the report, the United Way of Florida asserts that the federal poverty level, based on methodology not revised since 1974, underestimates the number of people in financial insecurity.

According to the United Way report, Florida has 1.65 million renters with income below the ALICE threshold and fewer than 736,000 rental units that population could afford, creating a deficit of 915,000 units. The shortage is worst in Southeast Florida, the report says.

“Florida is the most cost-burdened state in the nation when we look at rental housing,” Gilberts said. “Even in our rural communities, when you look at how housing costs match up with wages they don’t match up well.”

Coverage is key

West cited two other factors she said contribute to economic instability for Floridians: health insurance and unemployment insurance coverage.

The Center for American Progress, West’s organization, advocates for expanding Medicaid coverage. Florida could have provided health-care coverage to an additional 840,000 residents by accepting federal funds to expand its Medicaid program, as the state Senate leadership proposed in the 2015 legislative session. But Gov. Rick Scott and the House leadership rejected the idea.

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Instead, Florida continues to rely on a declining pool of federal funds for a program that covers the costs of treating people without insurance coverage at hospital emergency rooms.

“Expanding the Medicaid program under the Affordable Care Act, which Florida and 19 other states have not yet done, is critically important for low-income families,” West said. “Medicaid boosts health outcomes and also ensures families’ financial stability in the face of unpredictable medical costs.”

Unemployment insurance is another factor affecting economic stability that varies widely from state to state, West said. Though coverage is offered through a federal-state program, each state sets its own guidelines for how residents qualify.

Florida’s unemployment tax is levied on only the first $8,000 of a worker’s wages, West said, one of the lowest threshholds in the country. She said that makes the tax regressive because minimum-wage workers pay the same amount as CEOs.

“Florida has a very restrictive unemployment insurance system — one that excludes many low-wage workers from eligibility,” West said. “There are plenty of examples of other states where a large share of workers are qualified. Making sure the system covers a large share of workers I think is imperative to having a healthy economy.”

Drags on income

The United Way report considered other factors that eat away at the finances of the working poor, including child care and transportation. In about one-third of Florida’s counties, Gilberts said, a significant portion of the population commutes outside the county for work. That yields higher costs in gas consumption and wear on vehicles.

Public transportation is also lacking in many areas, Gilberts said. He said initiatives seeking new funding for public transportation failed in every county where they appeared on the ballot in the 2014 election. That included Polk County, where a proposed sales tax increase was resoundingly defeated.

In general, analysts say Florida has not yet developed enough industries that generate stable and high-paying jobs. An economist at the University of Florida said the state’s economy is less able to withstand cyclical shocks than those of many other states.
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“Part of the landscape in Florida overall is we don’t tend to have the high-paying industries that other states have and we’re extremely susceptible to the fluctuations within the greater economy,” said Chris McCarty, director of UF’s Bureau of Economic and Business Research. “If you have an economy very dependent on tourism and very dependent on construction and people moving here, particularly retirees, then when you have a severe recession in the rest of the country it affects Florida because people delay vacations, delay moving here, so it makes us particularly susceptible to those fluctuations.”

State agencies should foster ways for relatively low-skilled workers in service and tourism industries to graduate into better-paying jobs, said Jorge Zumaeta, an economist and business researcher at Florida International University.

“It is up to the local workforce-development agencies to strategize on how to benefit from some of the qualities of the industries, like easy access to a labor market, for example, and then nurture that talent in order to either aspire to manage within hospitality or transfer their skills into another, better-paying industry,” Zumaeta said.

Gary White can be reached at gary.white@theledger.com or 863-802-7518. He blogs about tourism at http://tourism.blogs.theledger.com. Follow on Twitter @garywhite13.