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Pay Key To Saving Middle Class

May 17, 2007
Oped By ORLANDO J. RODRIGUEZ

This week, the Connecticut State Data Center released the first official statewide and town-by-town population projections compiled in more than a decade. The numbers describe a Connecticut that is aging dramatically and where too few babies are born to maintain population growth. These projections also suggest that ethnic and economic segregation among towns may become more pronounced. However, these are not the most somber finding.

The most important demographic issue for Connecticut is the progressive loss of its middle class.

This loss results from the increasingly lopsided distribution of income in our society, a projected decline in the size of Connecticut's working population (a loss of 60,000 people by 2030) and a growing state workforce from low-income areas, which historically have not achieved reasonable educational outcomes.

Low educational attainment typically leads to low personal income. Consequently, the state's median personal income will fall (after inflation) if the educational attainment of our poor residents does not improve. In other words, Connecticut faces a future with a shrinking middle class.

Recent studies, such as that from the Nellie Mae Foundation, have come to the same conclusion. However, higher educational attainment is not sufficient; there must also be the accompanying jobs.

In Connecticut, population growth will continue to be anemic into the foreseeable future. Expect yearly population growth of about 0.27 percent, on average, through 2030. This corresponds to 3 additional residents a year for every 1,000 existing residents. This rate includes in-state births and foreign-born in-migration. Connecticut's projected growth rate is one-third the projected national growth rate of 0.85 percent.

In Connecticut, birthrates are below the national average for all ethnic groups. Because of the low fertility rates in the state, foreign-born in-migration must remain at its current historically high level if Connecticut is to avoid seeing its population shrink.

The current wave of immigrants from Latin America and Asia are the most recent group of individuals and families to revitalize our country. Hispanic and Asian immigrants are not fundamentally different from previous waves of Irish, German, Scot, Italian, Jewish and other immigrants.

We can accept their work ethic and vitality with open arms and afford them and their children the opportunity to acquire skills, income and wealth, and thus usher them into a rebuilt American middle class. Or we can deny them this path, largely from bigotry, with the result that the middle class continues its decline in population and influence.

The population of people 19 and under is projected to decrease by 8 percent (74,000 people) statewide by 2030. However, an increasing percentage of the K-12 population will live in low-income cities such as Hartford, Bridgeport and Waterbury. Thus, these same cities also will supply an increasing proportion of the workforce.

We will not improve educational outcomes of Connecticut's poor merely by spending more on education. We should not expect our educational system to solve society's problems. At its core, cultural isolation fosters poverty - poverty begets poverty. Among various policy responses, one of the most effective in reducing poverty comes from providing poor families opportunities to live and work in places that are not poor.

Wages should be high enough that earnings from low-skill jobs will support a family. Even Henry Ford, the icon of American industrialization, understood that his workers needed to have enough income to purchase the products they made.

He declared, "The highest use of capital is not to make more money, but to make money do more for the betterment of life." He might have added for the betterment of all lives - not just for a select few.

To secure a better future, or just preserve what we now have, we must increase real wages and benefits for low- and middle-income households. Think of income as return on investment of time and talent. Most people in poverty-stricken countries work physically harder and longer than we do. However, these hard-working people get little return for their investment of time and talent.

Today, in our country, a small minority of the population receives a disproportionately high return (income) on their investment of time and talent (work). And like people in those poverty-stricken countries, too many Americans also receive too little return for their investment of time and talent.

The future of Connecticut will be either a revitalized middle class or broadening economic disparity. The choice is stark.

Orlando J. Rodriguez is the manager and demographer at the Connecticut State Data Center.