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Figure 6-11
Recovery Act and Subsequent Extensions: Cumulative
Person-Years Kept from Poverty, 2008–2012
Millions of Person-Years
21
19.2
18
15
15.2
12
10.8
9
6
5.5
3
0
2008 2009 2010 2011 2012
Source: Bureau of Labor Statistics, Current Population Survey, Annual Social and Economic
Supplement; CEA Calculations.
in 2014 to raise the minimum wage for workers on new and replacement
Federal service and construction contracts to $10.10 an hour. This step will
to ensure that no worker who provides services to the Federal government
will raise their families in poverty, and will make Federal procurement more
economical and efficient. An extensive body of research suggests that giving
a raise to lower-income workers reduces turnover and raises morale, and
can thus lower costs and improve productivity. To help insure that work is
rewarded for millions more Americans, the President supports the Harkin-
Miller bill to increase the minimum wage to $10.10 by 2016 (Box 6-5).
To further enhance economic security and incentivize work, the
President has proposed to double the childless EITC to be worth up to
$1,000 and lower the age threshold from 25 to 21 to help more lower-income
young people, while continuing protections to ensure that it does not
benefit, for example, typical full-time students. A small EITC for childless
households was established in 1993, but its maximum value is expected to
be only $503 in 2015 and is fully phased out for individuals making over
$14,790 ($20,290 for married couples). This leaves a childless adult with
wages equal to the poverty line with a federal tax burden (including income
and payroll taxes) of $1,966 after receiving an EITC of $173, driving them
deeper into poverty and making childless workers the sole demographic
The War On Poverty 50 Years Later: A Progress Report | 261