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Poor in the US still struggling despite economic recovery

Economic data in recent months showed that the unemployment rate in the United States is dropping. It is a sign that the economic recovery is taking effect but people living in the city's homeless shelters are also at record levels.

NEW YORK: Economic data in recent months showed that the unemployment rate in the United States is dropping.

In New York City, employment is back at levels seen before the recession. It is a sign that the economic recovery is taking effect but people living in the city's homeless shelters are also at record levels.

For many it is a sign of a bigger problem behind the city's job growth.

The worst of the recession may be over but its effects still weigh heavily on the city's poor.

Lucia Russett, director of advocacy at the Little Sisters of the Assumption Family Health Service, said: "City-wide people that were already poor, got poorer and have stayed that way since 2008. So our numbers are just as high as they were since the beginning of the recession and actually even showing increases in the last year."

Many jobs have returned to New York but staff here said employment is not always enough to stay out of poverty.

Ms Russett added: "Right now (at the current) minimum wage -- you can still be at the poverty level while making minimum wage if you have a family, so that's obscene."

Fiscal Policy Institute statistics suggest most jobs created since the recession have been low-paying ones, typically around the New York State minimum wage of US$8 an hour.

In an increasingly expensive city, many said the minimum wage is simply not enough to get them out of poverty.

According to some experts, this rise in low-wage jobs is an issue for the economy too. A drop in unemployment is generally good news but these are not the types of jobs that trigger real economic growth.

James Parrott, deputy director and chief economist at the Fiscal Policy Institute, said more prosperity will be seen when more high-wage jobs are added to the economy. The idea is that high-wage jobs create an economic ripple effect as those on higher wages generally have employees working for them -- therefore creating more jobs.

Mr Parrott added: "The labour market while it's been improving... we still have a ways to go to get back to the quality of jobs we had and the quantity of jobs we had."

There may have been growth since 2008 but there are few signs of it. People said that it is not just jobs that they need but a greater share of the gains the economy has seen since the recession. 

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