Nearly one in six in poverty in the U.S.; children hit hard, Census says

September 13, 2011

Nearly one in six Americans was living in poverty last year, the Census Bureau reported Tuesday, a development that is ensnaring growing numbers of children and offering vivid proof of the recession’s devastating impact.

The report portrays a nation where many people are slipping backward in the wake of a downturn that left 14 million people out of work and pushed unemployment rates to levels not seen in decades.

As poverty surged last year to its highest level since 1993, median household income declined, leaving the typical American household earning less in inflation-adjusted dollars than it did in 1997.

Ominously, several analysts said, unemployment is projected to remain unusually high for the foreseeable future, meaning that the nation is probably in for an extended period of rising poverty and declining income.

“Not only have we experienced severe deterioration in recent years, but knowing how weak the outlook is makes this report even more ugly,” said Heidi Shierholz, a labor economist at the Economic Policy Institute. “We are staring high unemployment in the face for years to come.”

Last year, 46.2 million Americans lived below the poverty line — $22,314 a year for a family of four — marking the fourth year in a row that poverty has increased.

Locally, one in five District residents was living in poverty. In Maryland and Virginia, the poverty rate was about 11 percent. Since 2007, the poverty rate had increased by about two percentage points in all three jurisdictions.

“I’ve got people that are living in the woods. I’ve got people that are sharing rooms. So, honestly, that doesn’t surprise me,” said Rob Paxton, director of Safe Haven, a day shelter for the homeless in Fairfax County.

The economic turmoil has pummeled children, for whom the poverty rate last year — 22 percent — was at the highest level since 1993. The rate for black children climbed to nearly 40 percent, and more than a third of Hispanic children lived in poverty, the Census Bureau reported. The rate for white children was reported as above 12 percent.

With their surging population, Hispanics accounted for 37 percent of the children in poverty, a share that had increased substantially since the recession took hold in 2007, said William Frey, a Brookings Institution demographer.

“We had almost 1 million more children fall into poverty between 2009 and 2010,” said Catherine V. Beane, policy director at the Children’s Defense Fund. “We also have seen a continued increase in the number of children who live in extreme poverty,” for instance, a family of four living on $30 a day.

Maxine Thomas, who lives with two daughters and three grandsons in a mobile home in Elkridge, calls poverty a fact of life. During a long stretch of unemployment, her electricity was turned off this summer for two months. But her luck recently turned for the better. A church group helped get her electricity restored, and she landed a part-time a job at a supermarket. It pays $10 an hour, better than her last job but barely enough for her to squeeze by.

“I’m not even close to getting ahead,” Thomas said. “We still keep most our belongings packed up in storage because I have days where I fear we are going to end up on the street.”

The Census Bureau reported that 16.3 percent of Americans were without health coverage in 2010, a percentage that officials called statistically unchanged from 2009. Still, nearly 1 million more people were without insurance in 2010 than in 2009. The share of Americans with employer-based coverage continued a decade-long decline, dropping from 56 percent to 55 percent. The share of those covered by government insurance — including Medicaid, Medicare and military health care — rose slightly, to 31 percent.

The percentage of children without health insurance remained statistically unchanged in 2010 but only because the large number of those who lost private coverage was largely offset by the number picked up by Medicaid, the federal-state insurance program for the poor. More than 26 million children were on Medicaid’s rolls in 2010, a 1 percent jump from 2009.

Advocates for the poor said Medicaid’s growing role pointed to the need to keep the program out of reach of congressional budget-cutters. “More than ever people are depending on Medicaid as a lifeline,” said Ron Pollack, executive director of Families USA, an organization for health-care consumers.

The District, Maryland and Virginia all had higher rates of health coverage last year than the national average of 84 percent. In the District, 88 percent were covered; in Maryland, 87 percent; and in Virginia, 86 percent.

The inequality that has become a hallmark of the modern American economy has grown worse amid the economic upheaval of recent years. As of last year, median household income had declined by 7.1 percent since peaking in 1999, the Census Bureau reported, with those at the bottom feeling most of the pain. The income of the bottom 10 percent of earners had declined by 12.1 percent since 1999; the top 10 percent had experienced a decline of 1.5 percent.

The only group to have significant income gains is the richest 1 percent.

“Income down, poverty up, health insurance coverage down or flat,” said Ron Haskins, a senior fellow at the Brookings Institution. “The news on economic well-being in the U.S. is not good.”

The news was particularly bad for blacks, Hispanics and women. The poverty rate for Hispanics climbed to 26.6 percent last year, from 25.3 percent in 2009; for blacks, it increased to 27.4 percent, from 25.8 percent. For whites, the poverty rate was 9.9 percent, a half-percentage point increase. Meanwhile, 12.1 percent of Asian Americans were living below the poverty line in 2010, a rate statistically unchanged from 2009.

More than 17 million women lived in poverty in 2010, including more than 7.5 million in extreme poverty, with incomes of less than half the federal poverty line, according to the National Women’s Law Center.

Many policy analysts said poverty rose despite a flurry of government efforts, including the 2009 federal stimulus bill, which economists say kept unemployment from going even higher while bolstering unemployment benefits and increasing aid to the poor.

“Without the infrastructure investments and various other provisions of the Recovery Act of 2009, unemployment would have been higher and incomes lower in 2010 than these figures show,” wrote Shawn Fremstad, director of the Inclusive and Sustainable Economy Initiative at the Center for Economic and Policy Research.

Staff writers Sylvia Carignan, Carol Morello and N.C. Aizenman and staff photographer Michael S. Williamson contributed to this report.

Michael A. Fletcher is a national economics correspondent, writing about unemployment, state and municipal debt, the evolving job market and the auto industry.
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