This video is a part of our sequence “The Numbers That Outlined 2022.”
Transcript
One of the crucial essential numbers of the yr that you simply may not have heard of is 7.8 %. That’s the share of Individuals who have been dwelling in poverty in 2021, in response to the newest supplemental poverty price, which was launched by the U.S. Census Bureau in September of 2022. This metric, versus the official poverty price, captures how many individuals reside in poverty after accounting for the influence of key authorities packages focused at low-income households.
Throughout the pandemic, the federal government spent unprecedented funds to help lower-income households. So this is likely one of the first clear measurements we’ve of how COVID stimulus influenced poverty in America. And seven.8 % is, the truth is, the bottom recorded poverty price on file, for the reason that Bureau began monitoring this metric. Included in that determine is simply 5.2 % of American kids who lived in poverty in 2021, a 46 % drop from 2020 and in addition the bottom determine we’ve seen.
Plenty of the drop in poverty could be ascribed to the federal government’s COVID-19 reduction efforts in 2020 and 2021, together with the expanded little one tax credit score, which helped considerably cut back little one and total poverty in America by giving low-income households with kids additional money. For all that we frequently speak about Congress not having the ability to legislate or being caught in gridlock, it appears clear that it loved one of the crucial unquestionable coverage victories in latest U.S. historical past: lifting hundreds of thousands out of poverty.
However in fact, it’s extra difficult than that. For a similar causes that every one that authorities support helped cut back poverty, its absence will seemingly assist carry poverty again. You’ll be able to’t completely clear up poverty with a brief inflow of money.
The final federal COVID stimulus checks went out all the best way again in March of 2021, and the expanded little one tax credit score was phased out on the finish of final yr. By early this yr, it appeared that little one poverty was rising once more, and lots of Individuals reported not having the ability to pay for primary 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 massive for lower-income households.
So whereas simply 7.8 % of Individuals dwelling in poverty counts as a coverage victory, anticipate that quantity to be larger subsequent yr.
Extra details about the SPM chart: The Supplemental Poverty Measure (SPM) estimates for 2019 and past replicate the implementation of revised SPM methodology; extra data is on the market in “Poverty in america: 2021” report from the US Census Bureau, Appendix B. The information for 2017 and past replicate the implementation of an up to date processing system. The information for 2013 and past replicate the implementation of redesigned revenue questions.
