There is a cliff that impoverished families face just when they think they are about to reach a summit.
The downfall is unexpected and goes against the message they’ve been hearing for years.
“You can get out of poverty if you earn a higher wage,” the single, working mother of two children is told.
What she may not know is that if she makes even a few extra dollars an hour, she could lose all the benefits that have been helping her stay afloat and feed her family.
Providence House President and CEO Natalie Leek-Nelson knows exactly what can happen because she has witnessed it with her clients. During the past three years, she has seen a 109 percent increase of inquires for admission to Providence House. The number of children served has increased 70 percent. Assistance for families and parents is up 75 percent.
Leek-Nelson wants to start a conversation about why it is happening. “We have to have a conversation about a bridge,” she says. “You reduce benefits as wages increase, but you don’t completely remove public benefits and pull the rug out from under these families.
Leek-Nelson tells the story of a working mother of two girls who went to Providence House for help. She was given a $2.50-an-hour increase to go to a third-shift commercial cleaning job. The mother didn’t realize she would lose her assistance for food, utilities and childcare if she took the extra pay. As a result, she lost her job because she had to stay at home with her children, was evicted and ended up homeless.
Ashley Kurz, director of Family Services for Providence House, says parents are conflicted when it comes to taking on a pay increase or working for less to maintain their subsidies.
“People don’t want to be dependent on public assistance, but, at the same point, they don’t want to feel like they are regressing either,” Kurz says. “They have to decide if they want to work part time to keep their benefits or work full time and experience this new budget issue with a salary.”
It is for these reasons that the ongoing battle to raise the minimum wage in Cleveland to $15 is so significant — not just for Providence House, but other area nonprofit organizations.
The increase is 85 percent higher than the state minimum wage, which is $8.10 for full-time workers. According to Cleveland City Councilman Kerry McCormack, who represents Ward 3 where Providence House is located, the increase “would be the most aggressive and highest minimum wage in the United States.”
McCormack says that is one of the many reasons why he and his colleagues voted 16-1 against the proposal in August.
The Service Employees International Union, which drafted the proposal, wanted the raise to go into effect Jan. 1, 2017. According to McCormack, since that proposal was voted down, SEIU submitted an alternative proposal that would raise the minimum wage to $12 on Jan. 1, 2017. Every year after that, the wage would be raised by $1 until it reached $15.
According to McCormack, who is not opposed to raising the minimum wage in increments at a statewide level, the proposal’s future was still unclear at the beginning of September.
“I don’t think anyone truly understands the ramifications this would have,” he says. “This was not thought through. If we do something in a rushed, hasty way without totally understanding the impact it will have on job opportunities, small businesses and benefits, we could have real issues.”
Like McCormack, Leek-Nelson believes the community is unaware of the downsides associated with raising the wage. She said most people just see the sound bites. They don’t realize how one decision, which appears to be positive, could negatively impact the working poor.
“From our perspective, I think it’s something the community is not aware of,” she says. “We hear all of this great conversation about ‘let’s increase the minimum wage, let’s get people off of these benefits and, more independent, when in fact we are trapping them in this vicious cycle of ‘earn more, lose everything.’”
While the arguments for and against raising the minimum wage ensue, Leek-Nelson and her colleagues will continue to try to help as many people who knock on their door. They also will encourage families to better themselves, despite the looming cliff some may face.
“It’s so frustrating for us as an organization because we are trying to move these families to a place where they are safe and self-sufficient and contributing members of our society,” Leek-Nelson says. “They are really, really, really trying. It’s hard to see them fall down over and over again because these policies aren’t thoughtful about how we ween families off of benefits.”