California Minimum Wage Increases and Impact on Head Start Enrollment

Analysis shows a near perfect correlation between increase in the California state minimum wage and increase in Head Start enrollment of children above the poverty line.

In 2016 the state of California began a series of annual minimum wage increases, and is currently at $12/hr in 2019, with some cities enacting their own higher minimum wages. The increase in minimum wage has had a notable impact on enrollment for Head Start programs across the state, with fewer minimum wage earning families qualifying as below the federal poverty level. A typical Head Start program is mandated to serve children whose family income falls below Federal Poverty Guidelines (also known as the federal poverty line), but may also serve children at higher income levels under certain circumstances. California Head Start programs have experienced a dramatic increase in enrollment of children whose family income is between 100-130% of Federal Poverty Guidelines, which is a special category of enrollment that Head Start programs may serve with authorization from the Office of Head Start. This authorization is only allowed if a program has demonstrated it has exhausted enrollment of children below the Federal poverty level.

In working on Community Assessments for Head Start programs in California, one noticeable trend has been fewer families qualifying as income eligible (family income below the poverty line). One theory explaining this trend is that the state minimum wage is driving up wages to the point where families no longer qualify as income eligible. By analyzing statewide Head Start Program Information Reports (PIR) this theory can be supported. In the 2014-2015 program year 54 out of 122 California Head Start programs used the 100-130% income category (this excludes AI/AN Head Start programs because they may serve a larger percentage of over income children). In the 2015-2016 program year this jumped to 75 of 120 California Head Start programs and was at 107 of 120 in the 2017-2018 program year, an all time high. The number of children enrolled in the 100-130% of poverty-category also jumped, going from 432 in the 2014-2015 program year to 1,259 in the 2017-2018 program year, a 66% increase. What happened over these program years?

In the middle of the 2015-2016 program year the state minimum wage in California increased by $1 per hour to $10 per hour starting on January 1, 2016. This wage increase pushed a full time minimum wage earner above the federal poverty line for a family of three, from an average annual income of $18,720 per year to $20,800 per year. The 2016 Federal Poverty Guidelines for a family of 3 was at $20,160 per year. Since then the minimum wage has increased by 20% for employers with more than 25 employees and by 10% for employers with 25 or fewer as January of 2019. This far outpaces the increase in the federal poverty level, which was adjusted to $21,330 per year for a family of 3 in 2019. This indicates that fewer and fewer families supported by one wage earner will qualify as “Income Eligible” for Head Start services as the state minimum wage rises in California. The graph below illustrates this trend by showing the annual wage of a full time minimum wage earner in California (blue lines) and compares it to the federal poverty line for a family of three (dark green line) as well as 130% of the federal poverty line (light green line).

The subsequent rise in the number of California Head Start programs using the 100-130% enrollment category is nearly perfectly correlated with the rise in minimum wage (a correlation coefficient of +.91). The graph below removes the federal poverty lines and adds the number of California Head Start programs using the 100-130% enrollment category.

The graph below shows enrollment in California Head Start programs by enrollment category. The combined percentage of children enrolled in the “Income Eligibility” category and “Receipt of Public Assistance” category (both mean a child’s family income was below the federal poverty level) decreased from a high of 97.3% of all enrolled children in the 2012-2013 program year to a low of 75.4% in the 2017-2018 program year. Since the increase in California’s minimum wage, enrollment in the categories of “Over Income” and “Income between 100% and 130% of Poverty” have each increased to all time highs at 8% and 11.3% respectively in the 2017-2018 program year.

The graph below compares total enrollment in the 100-130% of poverty category to the state minimum wage in California. The two are nearly perfectly correlated (correlation coefficient of +.96 from 2014 to the 2017-2018 program year.)

Over the past four years the increase in California’s minimum wage has outpaced the increase in Federal Poverty Guidelines, which is calculated based on cost of living estimates. So long as this continues then fewer and fewer families will qualify as income eligible for Head Start services. What kind of families will have a harder time qualifying as income eligible?

  • Two parent families with one child: one parent working full time and one parent in school – In the 2017-2018 program year 5,216 California Head Start families had at least one parent in school or training. This is down 43.6% from a high of 7,125 in the 2015-2016 program year, right when the California minimum wage began to increase.
  • One parent families with one to two children and one wage earner – PIR data does not report the number of children in the family, but it does report the number of single parent families with an employed parent. In the 2017-2018 program year there were 20,197 Head Start families with a single parent who was employed. This is down 5.5% from a recent high of 21,383 in the 2014-2015 program year, right before the California minimum wage began increasingly annually.
  • Two parent families with parents who work part time jobs – An increasing number of Head Start families have two parents who are employed. There were 4,992 such families in the 2017-2018 program year in California, down from 8,596 in the 2014-2015 program year, a 41.2% decrease. Any two parent families with two or more children must balance work along with the duties of parenting their children. PIR data does not capture specific work schedules or full-time vs. part-time work status, but many families resort to staggered work schedules and part time work to ensure that at least one parent is available to take care of children when they are not at school.

While the rise in minimum wage in California is a welcome development for low income families, Head Start programs in the state must anticipate an increasing number of families falling in the 100-130% of poverty category and must shift recruitment efforts to target homeless families and children in foster care in order to remain in compliance with Head Start Performance Standards. Housing trends in the state indicate an increased cost of living (median rent is up 18.4% over the past 8 years, for instance) which may eliminate many of the positive impacts brought by minimum wage increases. So while these families may experience marginal increases in family income they may still be in need of social services due to a lack of affordable housing, childcare and healthcare in the state.

If you would like an analysis of your program’s enrollment as well as your service area’s poverty rate, cost of living and median family income, then please contact me. I have worked with many Head Start programs in California, Oregon, Washington, Delaware and other states across the nation with a state minimum wage that is higher than the federal minimum wage. I provide Community Assessment and Community Assessment updates for Head Start and Early Head Start programs and have also worked with Washington ECEAP, Oregon Pre-K and Arkansas ABC programs.

Oregon Minimum Wage Increase and Impact on Head Start Enrollment

In 2016 the Oregon Legislature enacted Senate Bill 1532 which established a series of annual minimum wage rate increases in the state beginning in July 1, 2016 through July 1, 2022. Beginning July 1, 2023, the minimum wage rate will be indexed to inflation.

The increase in minimum wage has had a notable impact on enrollment for Head Start programs across the state, with fewer minimum wage earning families qualifying as below the federal poverty level. A typical Head Start program is mandated to serve children whose family income falls below Federal Poverty Guidelines, but may also serve children at higher income levels under certain circumstances. Oregon Head Start programs have experienced a dramatic increase in enrollment of children whose family income is between 100-130% of Federal Poverty guidelines, which is a special category of enrollment that Head Start programs may serve with authorization from the Office of Head Start. This authorization is only allowed if a program has demonstrated it has exhausted enrollment of children below the Federal poverty level.

Each Oregon Head Start program I have worked with has expressed that fewer families in their service areas are income eligible (family income below Federal Poverty Guidelines). They theorize that this is due to minimum wage increases. By analyzing statewide Head Start Program Information Reports (PIR) this theory can be supported. In the 2015-2016 program year 14 out of 21 Oregon Head Start programs used the 100-130% income category (this excludes AI/AN Head Start programs because they may serve a larger percentage of over income children). In the 2016-2017 program year this jumped to 19 of 21 Oregon Head Start programs. The number of children enrolled in the 100-130% of poverty-category also jumped, nearly doubling from 678 children in the 2015-2016 program year (representing 3.9% of all Head Start children served in the state) to 1,178 in the 2016-2017 program year, (representing 6.6% of all Head Start children served in the state of Oregon.) What happened between these two program years?

Between these two program years the minimum wage rose by $.50 per hour for standard and Portland Metro counties and $.25 for nonurban counties. While this seems like a very small amount, it effectively raised the annual income of a full time wage earner in most Oregon counties from $19,240 a year to $20,280. Federal Poverty Guidelines for a family of three in 2016 was at $20,160 per year. This means that from 2016 onward, a family of three with one full time wage earner no longer qualifies as living in poverty because of Oregon’s minimum wage increase.

Below is a graph comparing the annual income of a full time, minimum wage earner to the federal poverty level for a family of three (dark green) as well as 130% of the federal poverty level for a family of three (light green). As soon as the minimum wage increased in July of 2016, these families no longer qualified as below poverty, and would have to be enrolled in Head Start’s 100-130% of poverty category. In the graph this is represented when the blue line (annual income of one minimum wage earner) is between the two green lines (100% and 130% of the federal poverty level.)

The graph below shows enrollment in Oregon Head Start programs by enrollment category. The percentage of children enrolled in the “Income Eligibility” category (meaning their family income was below the federal poverty level) decreased to below 50% starting in the 2016-2017 program year. Since the increase in Oregon’s minimum wage, enrollment in the categories of “Homeless Children” and “Foster Children” have each increased. This is likely due to Oregon Head Start programs shifting the focus of their recruitment efforts as more and more families are no longer income eligible.

Over the past three years the increase in Oregon’s minimum wage has outpaced the increase in Federal Poverty Guidelines, which is calculated based on cost of living estimates. So long as this continues then fewer and fewer families will qualify as income eligible for Head Start services. What kind of families will have a harder time qualifying as income eligible?

  • Two parent families with one child: one parent working full time and one parent in school – In the 2017-2018 program year 692 Oregon Head Start families were comprised of two parent families with one parent in school or training. This is down from 940 in the 2013-2015 program year, two program years before the minimum wage increase first took effect.
  • One parent families with one to two children and one wage earner – PIR data does not report the number of children in the family, but it does report the number of single parent families with an employed parent. In the 2017-2018 program year there were 3,464 Head Start families with a single parent who was employed. This is near the top of an upward trend, up 20.2% from 2,882 in the 2011-2012 program year.
  • Two parent families with parents who work part time jobs – An increasing number of Head Start families have two parents who are employed. There were 1,729 such families in the 2017-2018 program year, up from 1,568 in the 2011-2012 program year. Any two parent families with two or more children must balance work along with the duties of parenting their children. PIR data does not capture specific work schedules or full-time vs. part-time work status, but many families resort to staggered work schedules and part time work to ensure that at least one parent is available to take care of children when they are not at school.

While the rise in minimum wage in Oregon is a welcome development for low income families, Head Start programs in the state must anticipate an increasing number of families falling in the 100-130% of poverty category and must shift recruitment efforts to target homeless families and children in foster care. Housing trends in the state indicate an increased cost of living (median rent is up 24% over the past 8 years, for instance) which may eliminate many of the positive impacts brought by minimum wage increases. So while these families may experience marginal increases in family income they may still be in need of social services due to a lack of affordable housing, childcare and healthcare in the state.

If you would like an analysis of your program’s enrollment as well as your service area’s poverty rate, cost of living and median family income, then please contact me. I have worked with many Head Start programs in Oregon, Washington, Delaware and other states across the nation with a state minimum wage that is higher than the federal minimum wage. I provide Community Assessment and Community Assessment updates for Head Start and Early Head Start programs and have also worked with Washington ECEAP, Oregon Pre-K and Arkansas ABC programs.

Head Start Community Assessment Surveys and the New HSPS Requirements

In June of 2017 I presented at the Region XI Head Start Conference in Denver, CO. My presentation, Approaches to the New Community Assessment Requirements, covered some of the new requirements for Community Assessments in the latest version of the Head Start Performance Standards. The final section of my presentation (which can be downloaded here focused on surveys that can be used to address a few of these requirements, both new and old:

  • Typical work, school and training schedules of families
  • Community Strengths
  • Education, health and other social needs of families

During the presentation participants filled out online sample surveys using Google Forms. Google Forms, along with other online survey tools, provide an easy way to create surveys and assist with analysis by automatically creating live graphs based on survey results.

Embedded below is a Community Strengths survey. Other sample surveys include:

Integrating Survey Responses into your Community Assessment – AI/AN Region XI Case Study

Participants in the session, who were all Head Start staff from American Indian/Alaska Native Region XI Programs, responded to some of the sample surveys from above. Though this was just an exercise, participants were invited to respond sincerely and truthfully with regards to strengths, needs and issues in their respective communities. Through this process we reinforced a need identified through analysis of Program Information Report data for Region XI.

Participants were asked for a short response to the question “What are the challenges, issues and struggles in the community where you live?” 7 out of 8 of the short responses cited substance abuse of one form another (meth, alcohol and other drugs.) Additionally, 12 out of 12 respondents identified “Alcohol and drug use” as a challenge, issue or struggle in their respective communities.

survey_responses_struggles

The survey also asked respondents to rate the severity of issues and challenges in their communities. Alcohol abuse and drug abuse both tied with domestic violence for the most number of responses that indicated it was a “severe issue.”

survey_responses_severity_stress

These survey results corroborated data that was analyzed earlier in the presentation from Program Information Reports (PIR). PIRs for all programs in Region XI were aggregated and compared to other Head Start regions and all Head Start programs in the country as a whole. It was discovered that 2.5% of Head Start families in Region XI had “an expressed interest or identified need” for substance abuse treatment. In Region X (Alaska, Idaho, Oregon and Washington states) the same statistic was only 1% of families and in the Nation as a whole it was .7% of Head Start families.

substance_abuse

Though the survey was informal and not comprehensive, it can be used to illustrate how surveys and other data sources can be used in the Community Assessment. This analytical process shows that substance abuse is an area of high need for families in American Indian/Alaska Native Head Start programs. If Region XI were a single Head Start program then the Community Assessment process would identify this need. Findings and recommendations from the Community Assessment would inform the program’s long term planning process.

Sample data packs are available for Region XI programs here. These sample data packs include an overview of Census data for each program’s service area as well as PIR data, comparisons with state PIR data and graphs for each data set. It is meant to be used along with the presentation Approaches to the New Community Assessment Requirements.

If your program is not from Region XI or you can’t find your sample data pack then please contact me.

Tlingit & Haida Head Start Demographic Report

Prepared by Early Childhood Analytics

This report uses data from the 5-Year American Community Survey (ACS) to find demographic estimates for Region 11 AI/AN Head Start Programs. Tables DP03, S0101 and B17001A-I are used for the geography All American Indian Areas/Alaska Native Areas/Hawaiian Home Lands within United States. It combines these estimates with data from Program Information Reports from the Head Start Enterprise System. If there is no data or limited data in the tables and graphs below then there was not a large enough sample size for the service area for the ACS to produce reliable estimates. This report is an excerpt of a longer version which includes, among other things:

  • Median family income and income distribution for the service area
  • Households receiving SSI, SNAP Benefits/Food Stamps, and cash public assistance
  • Interactive map with data overlays by Zip Code & by recruitment area
  • Children with disabilities

Contact Early Childhood Analytics if you would like to inquire about receiving the full demographic report for your program.

Tlingit & Haida Head Start: Estimated Head Start Eligible Children

The poverty rate for families with children under the age of 5 was 11.6% for 2014, the latest year for which there is data. This is up from 11.5% in 2010. Using the poverty rate, population, and the percentage of the population under the age of 5, an estimate for the number of Head Start eligible children can be computed. In 2014 there was an estimated 135 Head Start eligible children living in the service area, up from 110 in 2010. With a total cumulative enrollment of 288 in 2014, Tlingit & Haida Head Start served approximately 213.3% of the estimated Head Start eligible population in its service area.

Tlingit & Haida Head Start 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
Population 29464 29467 30642 30898 31481
Percent of population under 5 05.3% 05.3% 05.7% 06.2% 06.1%
Population under 5 1585 1564 1760 1919 1925
Poverty rate for young families 11.5% 11.8% 11.4% 11.2% 11.6%
Estimated number of Head Start eligible children 110 111 121 130 135
Total cumulative enrollment 306 288 278 269 288

Tlingit & Haida Head Start: Race/ethnicity of Head Start eligible children

The ACS provides an estimate of the number of children under 5 living in poverty by race. This can be compared to the racial/ethnic makeup of the Head Start program’s enrolled children. Note that Hispanic/Latino children are not included in the pie chart below as they may be of any race.

Tlingit & Haida Head Start Est. HS Eligible (ACS) Children Served (PIR)
2014 2014-2015
White 63 54
Black/African American 0 0
AI/AN 51 197
Asian 2 6
Native Hawaiian and other Pacific Islander 0 14
Some other race alone 6 0
Two or more races 49 10
White alone, not Hispanic/Latino 94 0
Hispanic of Latino 40 25

Contact Early Childhood Analytics to inquire about the full version of this report for your program.

Taos Pueblo Head Start Demographic Report

Prepared by Early Childhood Analytics

This report uses data from the 5-Year American Community Survey (ACS) to find demographic estimates for Region 11 AI/AN Head Start Programs. Tables DP03, S0101 and B17001A-I are used for the geography All American Indian Areas/Alaska Native Areas/Hawaiian Home Lands within United States. It combines these estimates with data from Program Information Reports from the Head Start Enterprise System. If there is no data or limited data in the tables and graphs below then there was not a large enough sample size for the service area for the ACS to produce reliable estimates. This report is an excerpt of a longer version which includes, among other things:

  • Median family income and income distribution for the service area
  • Households receiving SSI, SNAP Benefits/Food Stamps, and cash public assistance
  • Interactive map with data overlays by Zip Code & by recruitment area
  • Children with disabilities

Contact Early Childhood Analytics if you would like to inquire about receiving the full demographic report for your program.

Taos Pueblo Head Start: Estimated Head Start Eligible Children

The poverty rate for families with children under the age of 5 was 37.5% for 2014, the latest year for which there is data. This is up from 20.1% in 2010. Using the poverty rate, population, and the percentage of the population under the age of 5, an estimate for the number of Head Start eligible children can be computed. In 2014 there was an estimated 43 Head Start eligible children living in the service area, up from 33 in 2010. With a total cumulative enrollment of 53 in 2014, Taos Pueblo Head Start served approximately 123.2% of the estimated Head Start eligible population in its service area.

Taos Pueblo Head Start 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
Population 5258 5361 5290 4958 5181
Percent of population under 5 05.1% 03.2% 04.2% 03.7% 03.6%
Population under 5 273 176 227 188 191
Poverty rate for young families 20.1% 22.7% 28.6% 39.8% 37.5%
Estimated number of Head Start eligible children 33 24 39 45 43
Total cumulative enrollment 54 70 56 53 53

Race/ethnicity of Head Start eligible children

The ACS provides an estimate of the number of children under 5 living in poverty by race. This can be compared to the racial/ethnic makeup of the Head Start program’s enrolled children. Note that Hispanic/Latino children are not included in the pie chart below as they may be of any race.

2014 5-Year ACS – Children Under 5 in Poverty by Race

Taos Pueblo Head Start Est. HS Eligible (ACS) Children Served (PIR)
2014 2014-2015
White 18 22
Black/African American 0 0
AI/AN 7 31
Asian 0 0
Native Hawaiian and other Pacific Islander 0 0
Some other race alone 19 0
Two or more races 1 0
White alone, not Hispanic/Latino 1 0
Hispanic of Latino 55 26

Contact Early Childhood Analytics to inquire about the full version of this report for your program.

El Paso County, CO – Head Start Demographics

Based on 5-Year American Community Survey (ACS) data from the US Census Bureau, El Paso County, CO has experienced a 16.8% increase in the number of estimated Head Start eligible children in it’s service area from 2010 to 2013. An increase in the overall population has been the primary cause of this increase, growing from about 588,500 in 2010 to 631,600 in 2013. There has also been a 1% point increase in the poverty rate for young families over the same time period. Funded enrollment has dropped over the same time period, with Community Partnership for Child Development Head Start reporting a drop from 1,034 funded Head Start slots in 2010 to 892 in 2013. An overview of El Paso County demographics is in the tables and charts below.

Sonoma County, CA – 2013 Estimated Head Start Eligible Children heat map
Sonoma County, CA – 2013 Estimated Head Start Eligible Children heat map
El Paso County ’10-’11 ’11-’12 ’12-’13 ’13-’14
Total Cumulative Enrollment* 1,259 1,291 1,263 1,116
Total Funded Enrollment* 1,034 1,034 1,034 892
Estimated Number of Head Start Eligible Children** 2,433 2,845 2,945 2,841
Poverty rate for families with children under the age of 5** 13.99% 15.43% 15.31% 15.10%
* PIR from Head Start Enterprise System        
** 5 Year American Community Survey from US Census Bureau      

More data from the 5-Year ACS can be found at Early Childhood Analytics web report. It includes:

  • Service Area totals: Population, population under 5, poverty rate for families with children under the age of 5 and estimated number of Head Start eligible children
  • Interactive map with data overlays by Zip Code & by recruitment area
  • 2010-2013 time line graph & table tracking the service area’s totals
  • Breakdown of the service area by Zip Code and by County
  • Racial characteristics and Hispanic or Latino/Not Hispanic or Latino table and graphs

Contact Us with questions or to request your program’s demographic report. The 2012 version of your program’s report is offered free of charge to demonstrate our capabilities.