Wednesday, September 22, 2010

The 2009 Poverty Numbers

On Thursday the Census Bureau released the 2009 data on poverty and income. It was disheartening, though not a surprise, to see that the poverty rate in the United States rose in 2009 while median income fell. Not surprising in part because from December 2008 to December 2009 unemployment rose from 7.4 percent to 10.0 percent; contributing to the staggering 1.1 percent jump in the poverty rate.

However, even with one of the highest recorded increases in the poverty rate, the numbers were not as bad as some predicted. This is due in part to government safety-net programs. Several initiatives provided cash transfers and kept some Americans from falling below the poverty line. Social Security supported the elderly; whose poverty declined. While unemployment insurance and major transfers made through ARRA supported non-elderly adults. It is also important to note that while substantial stimulus dollars went to support low-income families, those benefit programs provide in-kind assistance and were therefore not captured in the poverty data.

While safety-net programs might have moderated the effects of the recession for some, the severity of the increase in poverty should be taken very seriously by policymakers. At a time when 20.7 percent of American children are living in poverty it is important for policymakers to consider what strategies are working to moderate the impact of the recession on families, and which are not. Whether the program provides in-kind benefits or cash assistance it is critical to evaluate the way that saftey-net programs are helping those in the greatest need in a time of extreme economic hardship.

The poverty numbers also suggested that while the recession is impacting people across the country, it has been experienced in different ways and to differing degrees.

  • The poverty rate for those who have only a high school education or less rose by 1.2 percent, while for those with a college degree the increase was significantly less at 0.4 percent.
  • Male householders experienced a 3.1 percent increase in poverty, female householders experienced a 1.2 percent increase, and married couples experienced an increase of 0.3 percent.

Understanding how communities are being most effected and why will help policymakers create safety-net programs that will meet family and community needs. The Census Bureau’s proposed supplemental poverty measure will hopefully be a new tool in understanding poverty and lead to improved strategies for serving those most in need. In the meantime, Isabel Sawhill at Brookings suggests strengthening the safety-net for as long as it takes to get the unemployment rate back to a reasonable level. She suggests that this will not only support families but will also aid in the recovery by allowing families to maintain their purchasing power, helping to create jobs.

For more strategies on Family Economic Success.

More from our blog: a primer on poverty measurement and the Census instruments used.