New Census Data Reflect Real Improvements But Poverty Is Still Too High

According to data released today by the U.S. Census Bureau in its annual reports on income, poverty and health insurance, 2015 saw higher household incomes, lower levels of poverty and higher rates of health insurance coverage than in the previous year. This is the first time in 20 years that these three indicators have moved decisively in the right direction. Today’s data release also included the Supplemental Poverty Measure (SPM), which showed the important role public policies have played in moving the needle on these three important measures of well-being.

Despite these promising improvements, an unacceptably high number of people (13.5 percent) still lived in poverty in 2015. Of the 43.1 million people living in poverty, 14.5 million were children and 4.2 million were young children under the age of five. Children younger than five are the most racially diverse age group in the United States and the most likely to experience poverty, with today’s data showing that 1 in 5 of these young children (21.4 percent) lived in poverty in 2015. In comparison, 19.1 percent of children between the ages of 5 and 17, 12.4 percent of adults between the ages of 18 and 64 and 8.8 percent of adults age 65 and older experienced poverty during that same time period.

Poverty negatively impacts the health and well-being of all individuals, but it has the devastating ability to shape the trajectory of a young child’s life. Early childhood is an important time for developmental growth and is foundational to supporting positive health, behavioral and educational outcomes through adulthood. Unfortunately, poor children — disproportionately children of color — often lack access to the opportunities and environments that support optimal development and subsequently experience poorer outcomes than their peers.

For children and families of color, the challenges of poverty are often compounded by historic disinvestment in communities, and a continuing legacy of racially discriminatory public policies that contribute to discriminatory job markets, housing markets and school systems as well as other barriers to economic opportunity.

Today’s data show that nationwide, young children of color disproportionately experience poverty and deep poverty when compared with their white peers, with 37.4 percent of black and 30.2 percent of Hispanic children age five and younger living in poverty, while white and Asian children faced poverty rates of 12.8 and 11.9 percent, respectively. (It’s important to note, studies have found that Hmong Americans have a startlingly high poverty rate at 37.8 percent, followed closely by Cambodian Americans at 29.3 percent and Laotian Americans at 18.5 percent.) Today’s data also showed that in 2015, women were more likely to live in poverty than men, and this was particularly troubling for women ages 18 to 34 where the disparity was the highest and who are most likely to be raising young children.

Families with Young Children Living In and Near Poverty

The data released today highlight that too many families with young children are living in or near-poverty, unable to meet their basic needs like diapers, child care and food. Research tells us that families with young children need incomes of more than twice (200 percent) the federal poverty line (FPL) to secure these essentials.

Families Living Near Poverty. Today’s data show that 6.5 million young children, disproportionately children of color, are growing up in families that live at 150 percent of the federal poverty line or with incomes of less than $28,644 for a family of three in 2015. For these families, an unexpected expense, such as a sudden illness or car accident, can be financially devastating and throw them into a crisis and, too often, poverty. The number of individuals living near poverty is almost two times the number living in poverty, and that number is disproportionately composed of children and families of color. Much like families struggling in poverty, the near-poor are likely to be working full-time year round but their incomes are often insufficient to meet the costs of raising children, paying for child care, transportation and medical care while simultaneously building savings to become more economically secure.

Families Living In Poverty. The 43.1 million people, including 4.2 million young children, living in poverty (with incomes at or below 100 percent FPL or $19,096 per year for a family of three in 2015) face these same challenges, along with additional and compounding barriers that include unemployment and underemployment and lack of access to education, workforce training and high-quality child care. Single-female heads of household and people of color experience poverty at a disproportionate rate compared with the rest of the population. For example, 49.5 percent of related children younger than age six with a female householder lived in poverty last year. That’s more than four times the rate of poverty experienced by children of the same age living in married-couple families (10.1 percent). In addition, African Americans and Hispanics faced respective poverty rates of 24.1 percent and 21.4 percent, compared with the 9.1 percent experienced by whites and 11.4 percent experienced by Asians.

Growing up in a household with material hardship increases exposure to risk factors for young children, including a greater likelihood for exposure to community violence, higher rates of chronic illnesses, unsafe and unstable housing and limited opportunities for high-quality early care and education. This is compounded by health disparities and inequitable opportunities for learning and social-emotional development for young children living in poverty.

Families Living in Deep Poverty. The challenges and systemic barriers faced by the 19.4 million Americans living in deep poverty — of whom 6.5 million are children and 2.1 million are young children — are enormous. These children and families, with incomes of $9,548 per year or less for a family of three in 2015, face significant, wide-ranging and intersecting barriers. Homelessness; lack of immigration status; and mental, physical and intellectual impairments or disabilities are common experiences. These barriers compound the challenges experienced by many poor families, including access to child care and transportation. Unfortunately, these families are also the families least likely to have access to support from the means-tested benefits that could help them, including Temporary Assistance to Needy Families (TANF), the Supplemental Nutrition Assistance Program (SNAP) and child care subsidies. The data today show that 71 percent of children age six and younger in families living at 200 percent of the poverty line receive means-tested program benefits, but only 18.5 percent of children the same age but living in families in deep poverty receive support from these same means-tested benefits.

The Impact of Policy

Successfully supporting families living in and near poverty in their efforts to achieve economic stability requires strategies that are flexible, well-coordinated and responsive. Although some policy strategies are universally important, others need to be administered differently for families depending on their individual circumstances. Families with young children who are living in deep poverty may require supports and services that are different and more intensive than those needed by families who have fallen into poverty due to the loss of a job or spouse. The data released today from the SPM showed the significant impact of public policy on families living in poverty, with Social Security lifting 26.6 million individuals out of poverty. Refundable tax credits lifted 9.2 million people out of poverty and SNAP lifted 4.6 million people out of poverty. Alternatively, medical expenses contributed to 11.2 million people falling into poverty.

Policies that create incentives to serve families in deep and persistent poverty, reduce bureaucratic and unproductive barriers to service eligibility and set-aside slots for families living below the poverty threshold are important ways that safety-net policy can better support families. These include:

  • Establishing a Young Child Tax Credit (YCTC). A YCTC could provide families with additional support for children younger than age three to help offset the costs of raising a young child.
  • Ensuring coordination between the programs that are designed for young children and families. Families often navigate multiple benefit programs. Overlapping, duplicative or contradicting eligibility requirements can make it difficult to access the supports they need. In addition, data-sharing across programs — along with other information technology enhancements — can simplify the eligibility determination process and allow states to create a single process for determining eligibility across a number of programs.
  • Improving child care options. Expanding the supply of accessible, affordable, high-quality child care for low-income families, particularly those living in underserved areas or in areas with high concentrations of poverty could help to mitigate one of the most significant costs of raising young children.

Targeting poverty reduction efforts in ways that support young children and their families is an investment that can change their lives but also the future of our country. The data released today show that we are making important progress toward that goal — but also — that there is significant work left to do.

For a more detailed look at poverty in some of the communities where CSSP works, please see our forthcoming statement on the release of the American Community Survey.

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