Poverty Wages Cost Taxpayers $7 Billion in Public Benefits | Hillman Foundation

Clear It With Sidney

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Poverty Wages Cost Taxpayers $7 Billion in Public Benefits

American industry’s steadfast refusal to pay its workers a living wage is costing taxpayers $7 billion a year in public benefits, a new study shows. We tend to associate public assistance with unemployment, but according to the new report by the UC Berkeley Labor Center, an astonishing three quarters of beneficiaries are working. Their jobs just don’t pay them enough to cover basic necessities like food and medicine. 

These programs are a vital safety net for working poor families, but it would be nice to see highly profitable industries like fast food pulling their own weight and paying their employees a living wage instead of passing the buck to the taxpayers. The fast food industry is one of the worst offenders: 52% of the families of front-line fast food workers received some form of public assistance. 

No doubt, these employers see themselves as free market capitalists who abhor government subsidies. Yet, their business model is predicated on silent government subsidies because their workforce can’t make ends meet otherwise. 

From the taxpayer’s perspective, that dollar menu doesn’t seem like such a bargain anymore.