Homelessness in major cities is escalating as more laid-off workers already living paycheck-to-paycheck wind up on the streets or in shelters.
As Americans file for bankruptcy in record numbers and credit card debt explodes, more workers are a paycheck away from losing their homes. Now the frail economy is pushing them over the edge. With 9 million unemployed workers in July, the face of homelessness is changing to include more families shaken by joblessness.
Former neighbors and co-workers are on the streets, live with relatives or stay in shelters. Unemployed managers are living with their elderly parents. Families who once owned their own homes now sleep on bunk beds in homeless shelters. Job seekers in suits and ties stop by soup kitchens heading out to afternoon interviews. With no place to live, some homeless are camping out in their cars until work comes along.
"There is still a mind-set that the homeless are substance abusers who have made bad life decisions," says Ralph Plumb, CEO of the Union Rescue Mission in Los Angeles. "But more and more, they are individuals responding to a catastrophic financial event. The homeless are us. They're regular folk."
Requests for emergency shelter assistance grew an average of 19% from 2001 to 2002, according to the 18 cities that reported an increase – the steepest rise in a decade. The findings are from a 2003 survey of 25 cities by the U.S. Conference of Mayors. Among the trends:
- Families with children are among the fastest-growing segment of the homeless population, according to the National Coalition for the Homeless. The Conference of Mayors found that 41% of the homeless are families with children, up from 34% in 2000. The Urban Institute reports about 23% of the homeless are children.
- Cities and shelters are also seeing the shift. In New York, the number of homeless families jumped 40% from 1999 to 2002. In Boston, the number of homeless families increased 8.3% to 2,328 in 2002 compared with 2001.
- An estimated 3.5 million people are likely to experience homelessness in a given year, the Urban Institute reports. People remained homeless for an average of six months, according to the Conference of Mayors survey – a figure that increased from a year ago in all but four cities.
Homelessness also increased during past recessions, but advocates say several issues are making the current rise more disconcerting. Those factors include the five-year cap on welfare benefits, a surge in home prices adding to longer periods of homelessness, and the fact that this recovery has been a jobless one, providing little immediate hope.
In fact, the majority of cities polled by the Conference of Mayors expect homelessness to increase over the next year.
While the economy is driving some of the increase in demand for shelter and food assistance, other factors include mental illness, substance abuse and low-paying jobs, according to the Conference of Mayors survey.
Jobs hard to find
For many families already on the edge, homelessness is a catastrophic reality. Less than a year ago, Kimberly Brochu was expecting a baby and living with her husband and four children in an apartment in Winslow, Maine. Then her husband, Allen, was laid off from his painting job.
Eight months pregnant, Brochu wound up on the streets with her family. They spent their nights sleeping in bunk beds at a homeless shelter and during the day camped out in their car at a Burger King. Today, she and her husband rent a duplex and are both working again.
"People think we get homeless because we're irresponsible, but it's hard finding jobs," says Brochu, 29, who works as a housekeeper and a waitress; Allen is a farmer's helper. "But my kids, if they become successful, they won't look down on people who are poor."
A growing number of families are vulnerable to homelessness because of the dismal job climate. The unemployment rate reached 6.4% in June, the highest since April 1994 before edging back to 6.2% in July. Last month, there were nearly 2 million unemployed workers who had been looking for a job for 27 weeks or longer, an increase of 276,000 since January, according to the Department of Labor.
For the homeless, getting or keeping a job without a place to live is a challenge. About 20% of homeless are employed, according to the Conference of Mayors.
More of those workers losing their jobs aren't able to afford a stint of unemployment. Nearly a quarter of Americans would be late on mortgages, rent or other bills if a single paycheck were delayed, according to a 2003 poll by Automatic Data Processing.
The proportion of disposable personal income that Americans are putting into savings was about 8% in the 1970s but has tumbled to less than 4% today, according to the National Center for Policy Analysis.
Layoff led to homelessness
All it took was a layoff to push Robert Garner over the edge. About a month ago, the 40-year-old was laid off from his job at a packing plant and could no longer afford the $475 rent for his mobile home in Lima, Ohio. So he packed a backpack with whatever he could carry – clothes, a razor and sleeping bag – and hitchhiked 122 miles to Cincinnati, where he wound up sleeping under a bridge. He sold his car because he couldn't keep up with the payments.
He went to soup kitchens for meals or worked odd jobs to pay for food. Drop-in homeless shelters provided a place for him to shower. In late July, he got a $9.50-an-hour job driving a forklift for the Ohio Valley Goodwill Industries Rehabilitation Center, which also provided him with housing.
"The economy has really taken a toll on manufacturing," Garner says. "It was hard. I don't like to take things from people. I like to help myself. In a way, you get a sense of hopelessness. But I tried to keep a nice, clean appearance."
Other factors putting more families and workers at risk:
- Soaring housing costs. The median price for existing homes is projected to rise 6% in 2003 to $167,800, according to the National Association of Realtors.
"The economy has been in a down phase before, but this time housing prices have really continued to skyrocket. It's been a huge factor in the explosion in homelessness among families," says Mitchell Netburn, director of the Los Angeles Homeless Services Authority, which coordinates homeless programs in the city and county. The median home price in the Los Angeles area for the first quarter of 2003 was $307,900. That's up 16.2% from the first quarter of 2002.
As prices go up, it becomes harder for the poor to purchase a home or even afford rent.
Nearly 28 million households – one in four – reported spending more than 30% of their income on housing, according to the Millennial Housing Commission. That amount is more than the government deems affordable, the commission reports. Median monthly gross rent in the nation climbed to $602 in 2000 from $481 a month in 1980, according to the U.S. Census Bureau.
- Mounting debt. Consumer debt is growing, and more homeowners are taking out loans to pay credit card debts. Foreclosures are up. Last year, there were 1.5 million bankruptcy filings by individuals – the highest on record – up from 289,000 non-business filings in 1980, according to the American Bankruptcy Institute.
Though about 20% of the homeless live in the suburbs, the rise in homelessness is mostly manifesting itself in major urban areas.
In Boston, the number of homeless women increased by 10% in 2002 compared with 2001, according to a city census. In San Francisco, the city reports that the homeless population in 2002 was 8,640, an 18% rise over 2001.
- Lack of financial safety nets. The increase in homelessness and hunger is overwhelming some cities and shelters: An average of 30% of the requests for emergency shelter by homeless people – and 38% of the requests by homeless families – are estimated to have gone unmet in 2002, according to the Conference of Mayors.
In 60% of cities, shelters may have to turn away homeless families because of a lack of resources. Many cities have shelters that specifically accommodate families, but even then, husbands and wives often are separated.
In addition, more welfare recipients are reaching the five-year federal limit for receiving benefits. At the same time, philanthropic donations to homeless services are down along with overall charitable giving. That means there are fewer financial safety nets for workers who are already living on the financial precipice. And unemployment benefits aren't always a resource – in fact, less than half of laid-off workers qualify under varying state eligibility requirements.
David Smith, 46, worked in the stock room at Kmart until he was laid off earlier this year. He applied for public assistance but had already reached his lifetime cap for receiving federal benefits. Unable to pay his rent, Smith went to a homeless shelter. He is now living in housing provided by The Doe Fund, a New York-based organization that employs and supports the homeless in efforts to become self-sufficient through work.
"Without a job, I couldn't pay my rent," Smith says. "It's stressful when you go to the soup kitchen. I want to save money and get my life back on track."
Signs of the increase abound. Alfred Thompson, a job trainer at Goodwill Industries of Kentucky in Louisville, says one of his homeless clients lost his job and is living in his Mercedes, which is paid for, while he seeks employment.
At St. Bartholomew's Church in Manhattan, a mosaic-domed landmark near The Waldorf-Astoria hotel, more than 100 homeless men and women arrive on Monday and Wednesday mornings for a stick-to-your-ribs breakfast of beans-and-franks, corned beef hash or chicken stew.
"We see people dressed in suits and ties come in before they head out to look for work," says the Rev. John David Clarke, director of community ministries. "They can save a buck or two."
In Louisville, job seeker Reginald Cook, 53, dons his best interview clothes and shaves before heading out to try to land a steady job. At night, he calls the Salvation Army Center of Hope his home.
He arrives after 5 p.m. for a shower and reads a bit of a book before lying down on his dormitory-style bed to sleep. Before coming here, he'd lived with his parents in Birmingham, Ala., after being injured on the job. He left in hopes of finding better employment opportunities in Kentucky. Even though it's meant not having a home, he still believes the job opportunities are better in Louisville. "It's hard because quite a number of people are laid off, and you can't find the work,' " Cook says.
For William and Sue Kamstra, it took five months to lose everything. The couple and their three children were living in a three-bedroom home in Bellflower, Calif. They had a two-car garage and fruit trees in the backyard. He earned more than $40,000 a year working in customer service, providing operational support in the music division of Yamaha.
But then they were beset by personal financial problems, which caused them to miss house payments. Their home was foreclosed upon. They planned to rent an apartment, but then William lost his job, and they were unable to get back on their feet. An accident left their van totaled, so they had no way to get around. They stored their belongings and moved to a hotel until their money ran out in June. Now, they spend their nights at the Union Rescue Mission, a Los Angeles shelter.
During the day, William looks for work while Sue takes the children to the library. In 20 years of marriage, this is the first time the Kamstras have been homeless.
"If he hadn't gotten laid off, we'd have rented an apartment. We would have been OK," Sue says. The children expect to resume school in the area this fall.
"This is horrendous. You have a feeling of such alienation," says William, 43. His daughter is 14, and his sons are 12 and 11. "You have this view of homeless people, but I have one beer a year on my birthday, and I don't do drugs. But there are a lot of families here, a lot of children and babies in strollers."