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Study: New Jersey not affordable for 1 in 4 households

dollar101011_optBY GINA G. SCALA
NEWJERSEYNEWSROOM.COM

Living in New Jersey has always taken a certain je ne sais quoi, but nearly four years after the markets crashed that special something is costing more, both financially and emotionally, on a record number of residents.

A new study, commissioned by the United Way of Northern New Jersey, found “one in four households in New Jersey is walking a financial tightrope, unable to afford this state’s high cost of living, one emergency from falling into poverty.”

To live in New Jersey, a family of four needs an income of $58,500 a year, according to the report. Federal guidelines place the poverty level at slightly more than $22,000 a year. Senior citizens are more likely to live above the federal poverty level, but under the verge of what it takes to endure in the state, the report found. Social Security is largely responsible for putting seniors above the poverty level, but the study cautions it “does not enable self-sufficiency,” New Jersey Public Radio reported.

“This is about people who are working and falling behind, ”John Franklin, CEO of United Way in Northern New Jersey, said.

The study, five years in the making, was authored by Stephanie Hoopes-Halpin, associate professor at Rutgers’s School of Public Affairs.

“In New Jersey 40 percent of households in 2009 didn’t have enough cash assets to subsist at the poverty level for 3 months,” Hoopes-Halpin told NJPR. That number didn’t include assets such as cars, homes or retirement accounts.

The report found more families are struggling because they aren’t earning enough to survive living in New Jersey. More than 50 percent of jobs in New Jersey pay less than $20 an hour and the average wage for a new hire here was $2,900 a month two years ago, according to the report. Although, there are large inconsistencies for new hires in 2010; those in Atlantic County took in half of what those in Somerset County, the ninth-richest county in America, made. Meanwhile more than a quarter of Somerset County households did not meet the threshold of the ALICE study.

"There’s a stereotype of low-income people being lazy and milking the system," Hoopes-Halpin told the Star-Ledger. "From what we see there’s a lot of people who are working very hard — one or two jobs for not a lot of money and they don’t have a lot of savings. These families have no room to make a mistake."

New Jersey is one of the states with the highest cost of living and the lowest minimum wage (unlikely to increase because of the financial strain it would place on small-business owners), according to the Star-Ledger.

The New Jersey Department of Labor reported 36,300 jobs were formed in New Jersey in the past year or so; roughly 24,000 in education and health services and 13,700 were in the leisure and hospitality industry. Still, the state’s unemployment rate is above the national average.

 

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