This video is a part of our collection “The Numbers That Outlined 2022.”
Transcript
One of the vital necessary numbers of the yr that you just may not have heard of is 7.8 p.c. That’s the share of Individuals who have been dwelling in poverty in 2021, in line with the most recent supplemental poverty rate, which was launched by the U.S. Census Bureau in September of 2022. This metric, versus the official poverty charge, captures how many individuals reside in poverty after accounting for the influence of key authorities applications focused at low-income households.
Through the pandemic, the federal government spent unprecedented funds to assist lower-income households. So this is among the first clear measurements we’ve of how COVID stimulus influenced poverty in America. And seven.8 p.c is, in reality, the bottom recorded poverty charge on file, because the Bureau began monitoring this metric. Included in that determine is simply 5.2 p.c of American kids who lived in poverty in 2021, a 46 p.c drop from 2020 and likewise the bottom determine we’ve seen.
Plenty of the drop in poverty will be ascribed to the federal government’s COVID-19 aid efforts in 2020 and 2021, together with the expanded youngster tax credit score, which helped considerably scale back youngster and general poverty in America by giving low-income households with kids further money. For all that we regularly discuss Congress not with the ability to legislate or being caught in gridlock, it appears clear that it loved some of the unquestionable coverage victories in current U.S. historical past: lifting hundreds of thousands out of poverty.
However after all, it’s extra sophisticated than that. For a similar causes that each one that authorities assist helped scale back poverty, its absence will probably assist carry poverty again. You possibly can’t completely remedy poverty with a short lived inflow of money.
The final federal COVID stimulus checks went out all the way in which again in March of 2021, and the expanded youngster tax credit score was phased out on the finish of final yr. By early this yr, it appeared that youngster poverty was rising once more, and lots of Individuals reported not with the ability to pay for fundamental wants. Inflation is part of that — and a few would argue, spurred on by the additional stimulus. And now, rising rates of interest — and the concern of a recession — additionally loom giant for lower-income households.
So whereas simply 7.8 p.c of Individuals dwelling in poverty counts as a coverage victory, count on that quantity to be larger subsequent yr.
Extra details about the SPM chart: The Supplemental Poverty Measure (SPM) estimates for 2019 and past mirror the implementation of revised SPM methodology; extra data is out there in “Poverty in the United States: 2021” report from the US Census Bureau, Appendix B. The information for 2017 and past mirror the implementation of an up to date processing system. The information for 2013 and past mirror the implementation of redesigned earnings questions.
