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Working and on welfare: NH tops

New Hampshire Union Leader

April 16. 2015 7:31PM

New Hampshire is first among the states in the portion of its public assistance dollars that go to working families, according to a study released this week by researchers at the University of California at Berkeley.

Sixty-five percent of the $160 million that New Hampshire taxpayers devoted annually to Medicaid, children’s health and the Temporary Aid To Needy Families (TANF) welfare program went to working families, according to the study, titled The High Public Cost of Low Wages.

The cost of several assistance programs, such as Medicaid and TANF, are split between state and federal governments.

When it came to the percentage of federal public assistance dollars that go to working families, New Hampshire ranked fourth — behind Texas, Utah and Idaho. The study covers the years of 2009 to 2011, when the country was in a deep recession and New Hampshire had one of the lowest unemployment rates in the country.

The study was released by Berkeley’s Center for Labor Research and Education. It reported that 56 percent of all public assistance dollars, from both state and federal sources, went to working families nationally.

Center researchers said the trend is due to the failure of wages to keep pace with the cost of living, and it said that low wages cost federal and state governments $153 billion a year.

“When companies pay too little for workers to provide for their families, workers rely on public assistance programs to meet their basic needs,” said Ken Jacobs, chair of the Labor Center and co-author of the new report. “This creates significant cost to the states.”

However, a New Hampshire economist said that New Hampshire has a low rate of poverty. States with higher poverty rates, such as Mississippi, have lower percentages of public assistance dollars going to working people, noted Dennis Delay, an economist with the New Hampshire Center for Public Policy Studies, a non-partisan think tank.

“I’m not sure New Hampshire ranking at the top of the list is a bad thing,” Delay said. He said wages and public assistance combine to keep New Hampshire people out of poverty.

The study looked at spending for programs such as TANF, Medicaid/Children’s Health Insurance Program, Earned Income Tax Credit and food stamps.

It defines a working family as a family with at least one member who works 27 or more weeks per year and 10 or more hours per week.

New Hampshire state wage data show large numbers of people in low-paying jobs. For example, more than 48,000 New Hampshire people work as cashiers or retail sales people, according to New Hampshire wage and employment data for 2014. Their average starting pay is $8.31 an hour, the state reported.

Another 11,800 worked in fast food jobs. They started at $8.17, and their median wage was $9 an hour.

“We have a low minimum wage, a relatively low unemployment rate, and very high costs for housing,” said Arnie Alpert, whose American Friends Service Committee advocates for higher wages. “Public assistance helps fill the gap, but still leaves people with low wage jobs struggling to make ends meet.”

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