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Employed But Struggling: Report Finds 1 in 3 Working Families Near Poverty

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Michelle Feliz, a single mother living in Boston, can't afford day care for her one-year-old son. She can't afford new clothes for her teenage daughter. Late last year, she applied for food stamps.

Unlike many Americans increasingly seeking public assistance, Feliz, 35, is employed. Yet what she earns in her job as a secretary does not cover even her most basic needs, leaving her scrambling to keep food on her table.

In the aftermath of the worst economic downturn since the Depression, much attention has been focused on the 15 million people who are officially out of work, yet even among those who have jobs, livelihoods and living standards have been substantially downgraded. Growing numbers of employed people live in near poverty, struggling to make ends meet.

Almost a third of America's working families are now considered low-income, earning less than twice the official poverty threshold, according to a report released Tuesday by the Working Poor Families Project. The recession, which has incited layoffs and wage cuts, reversed a period of improvement: Between 2007 and 2009, as the recession set in, the percentage of U.S. working families classified as low-income grew from 28 percent to more than 30 percent.

Workers who once focused on career advancement now live paycheck to paycheck. The American middle class, in effect, is eroding.

"They're no longer working actively, with a chance to advance and gain more experience and skills," said Brandon Roberts, manager of the Working Poor Families Project and a co-author of the report. "They're just putting pieces together to stay afloat, to meet basic needs."

Last year, 45 million people, including 22 million children, lived in low-income households, according to the report. As breadwinners lost jobs or suffered pay cuts, the report notes, the number of low-income families grew to 10 million last year, an increase of almost a quarter-million from 2008. The problem is worse among minorities: 43 percent of America's working families with a minority parent are low-income, the report finds, compared to 22 percent of white working families.

Feliz, who is Latina, has a job. But she's barely scraping by.

"I had to take this job because it was the only thing I could find," Feliz said. "I was making more money than I'm making now."

Once an officer manager at Oficina Hispana, an English language education program, Feliz was laid off in 2007 when her employer didn't get a crucial grant. She collected unemployment insurance for half a year, she said. The week before the benefits expired, she got her current job as a secretary at the University of Massachusetts Boston.

Her annual salary dropped from $42,000 to $37,000. And her dream of opening a shelter for female victims of domestic violence was deferred.

"Career-wise, that set me back a lot," she said.

She now struggles just to put food on the table. She applied for food stamps in November of last year, she said, but was denied because her salary was just above the cutoff. So she began clipping coupons. When her son came down with a bad fever recently, she feared she would have to make a difficult choice: stay home and risk losing her job, or take him to prohibitively expensive day care. Fortunately, her parents, who also live in Boston, were able to look after him.

"I'm afraid to stay home," Feliz said. "If I take too many days off, I could lose my job."

Feliz, who has an associate's degree from Roxbury Community College, is taking classes in human services and management at UMass Boston, and her employer agreed to help foot the bill. She hasn't given up on her dream, but her focus right now is on preserving her income.

"I'm doing at least three people's jobs," she said. "It's hard."

Her son's father, who pays child support, is similarly struggling to keep two part-time jobs, Feliz said.

The crisis extends beyond the struggling breadwinners. Children in low-income families suffer from diminished educational opportunities and compromised health care, according to the new report. Nationwide, 35 percent of children in working families are living in low-income households, the report finds, and childhood poverty tends to persist into adulthood.

"That has serious implications for children, not only today, but as they look to the future," Roberts said. "The odds are being stacked against them."

Living in a low-income family can take a psychological as well as financial toll. Feliz has striven to raise her children's spirits, pushing her daughter to do well in school.

"I want her to be able to get a good job," she said, "to have things I'm not able to give her."

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