The homeless population in New York City has risen to never before seen levels, according to a recent report published by the advocacy group Coalition for the Homeless. A staggering 113,552 people slept in the city’s emergency shelters last year, including over 40,000 children. The total marked an 8 percent increase from the previous year and a 37 percent increase from 2002.

The report also highlighted the growing number of families sleeping in shelters—another record, at nearly 29,000 families in the system, an increase of over 80 percent from 2002 levels. Also skyrocketing was the number of families who had previously spent some time in the shelters returning for further aid, now approximately half of all those receiving assistance.

However, even these numbers in fact drastically underestimate the true scope of the homeless crisis in New York City. According to the NYC Department of Homeless Services, 64 percent of those applying for emergency shelter last year were denied it. Many were found ineligible on spurious claims that they could temporarily lodge with relatives, even when faced with overcrowding, unsafe conditions, or even the flat-out refusal of the relatives to accommodate them. As Coalition for the Homeless spokeswoman Mary Brosnahan explained, the administration of Mayor Michael Bloomberg employs a deliberate policy of “active deterrence,” making the process so burdensome that many families just give up.

The extraordinary levels of homelessness are an indication of the social catastrophe unfolding for the working class in the city. While the Obama administration is trumpeting the economic recovery for the corporations, the crisis affecting masses of working people is only deepening. Three years after the Wall Street meltdown, the official jobless rate in New York City remains near 9 percent, with real unemployment and underemployment much higher. In particular, the long-term joblessness that has characterized this economic crisis continues to bring severe hardship—and homelessness—to large numbers throughout the city.

Yet even for those who have escaped unemployment, a job is by no means a guarantee of housing. A significant percentage of adult workers—nearly a third citywide and over 40 percent in the Bronx—are classified as low-wage earners, according to the Center for an Urban Future. For New York City, this equates to a wage under $11.54 per hour, or $24,000 per year on a full-time schedule.

Meanwhile, the rents in New York City are reaching astronomical levels. According to data available from the National Low Income Housing Coalition, the “fair market” rental rate for a two-bedroom apartment in New York is $1,359. Housing advocates typically consider affordable rates to be no more than a third of the family income. Thus, a family in New York City must earn at least over $54,000 to find an affordable home. The median household income for renters in the Bronx is barely $30,000 a year. For Brooklyn, it is nearly $35,000.

For the huge numbers of low-wage workers, the enormous housing prices are nearly insurmountable. According to the Community Service Society, “Two-thirds of poor New Yorkers and over one-third of near poor households—up to twice the poverty level—spend at least half of their incomes on rent. These extraordinary rent-income pressures have a destabilizing effect on poor communities and place millions of low-income New Yorkers at risk of housing hardships and displacement.”

Currently, the New York City Housing Authority is experiencing record demand for subsidized housing assistance. However, just 13,000 new families were either admitted last year into the public housing system or received federal housing vouchers known as Section 8. Scarcely any of the 29,000 families in the shelter system qualified.

In fact, because of budget cuts, New York City has not accepted any new applications for Section 8 since 2009. The waiting list for public housing and Section 8 can often last a decade or more.

At the same time as this catastrophe for the working class deepens, the abundance for the top 1 percent, who collectively earn more than the bottom 90 percent combined, almost defies belief. Last month saw another record for the largest sale price of a single condominium: $48 million for a unit in the Plaza Hotel Residences overlooking Central Park. Luxury condo and apartment buildings continue to enter the market in droves. A notable example, the 76-story residential tower near the financial district designed by superstar architect Frank Gehry, will offer 900-plus units to the city’s financial elite, with single apartments going for up to $20,000 a month.

Under these conditions, the transfer of wealth from workers to the fabulously wealthy takes on a criminal character. Obama’s budget compromise, passed four months after granting hundreds of billions in tax giveaways to the rich, included $2.8 billion in cuts to federal housing programs. These cuts will further restrict access to affordable housing and leave the already decaying subsidized housing stock to deteriorate further as maintenance is deferred.

At the state level, Democratic Governor Andrew Cuomo’s “budget for the people,” as he cynically called it, not only included additional tax breaks for millionaires but also cut aid for municipalities and cancelled all state support for New York City’s program to help move the homeless out of the shelter system. The program, known as Advantage, provided temporary rent subsidies for a subset of employed New Yorkers in the shelter system.

In response to the state’s cuts, as well as New York City’s own drive towards austerity, the Bloomberg administration recently announced an immediate halt to the Advantage program, threatening to cast 15,000 families back into the shelters or onto the streets. A court has delayed the cut at least until May, when a final decision on the legality of cancelling the city’s commitment to Advantage tenants will be made.

However, the Advantage program itself, as well as its predecessors, was consciously advanced by the Bloomberg administration as an alternative to providing long-term affordable housing opportunities for the poor and working class. The result, as the Coalition for the Homeless report points out, is that “Thousands of formerly-homeless children and families have been forced back into homelessness, with some making a third trip through the shelter system; The homeless shelter population has reached all-time record levels; and city and state taxpayers have paid hundreds of millions of dollars more in shelter expenses than if the city had maintained the policy of using federal [long-term] housing programs.”

In addition to cancelling the Advantage program, Mayor Bloomberg proposed $37 million in cuts to the city’s budget for homeless services this year. He also plans to reduce funding this coming year and completely eliminate next year a program that provides crisis shelters and drop-in centers for homeless youth.

WSWS spoke to a worker who has experienced the homelessness crisis firsthand. Nija Myrick, a 31-year-old, college-educated woman from the Bronx, spent 22 months in the city’s homeless shelter system with her daughter. She was recently placed in the Advantage program after finding employment at a local housing complex. She now makes $8.00 an hour, more than a 50 percent wage cut from her previous job.

Nija described her time spent in the emergency shelter system: “It was hellish. I hated it. The curfew, showing papers for everything, always having to prove my whereabouts at all times… It was a prison for me.” She continued, “I cried. I didn’t care about my appearance. I was so depressed. It was awful, awful, awful.”

The conditions ultimately took a toll on her health. “I was very stressed, to the point of being physically sick.” Now faced with the cuts to her Advantage rental subsidy, Nija explained the desperation has returned. “There’s no way I can afford an apartment on my income. They promised two years, now it’s all just taken away…. What’s left, what can I do? I’ve tried everything. Sometimes I feel like I’m ready to go slit my throat.”

She continued, “[The city’s programs] are a joke, not because the people there don’t want to help, but because there’s nothing they can do—there’s no funding. People in the system don’t get training, no education, no guidance, nothing. Now they’re talking about laying off teachers, cutting teachers assistants. And as for Obama, I think he is concerned about other things, he’s not concerned about people like us.”