US Census Data Shows COVID Pandemic Undo Progress on Poverty

The poverty rate in the United States increased to 11.4 percent in 2020 after reaching a 60-year low in 2019.

By Bloomberg

American household incomes fell in 2020, while the national poverty rate rose from a 60-year low when the Covid-19 pandemic disrupted the American economy and left millions out of work.

Median household income adjusted for inflation fell 2.9% last year to $ 67,521, according to annual data released Tuesday by the U.S. Census Bureau.

The poverty rate rose one percentage point to 11.4% after falling for five consecutive years and reaching the lowest level since 1959 in 2019.

The data helps shape the picture of the economic health of American families in 2020 amid a pandemic that caused the first annual economic contraction since 2009, put tens of millions out of work and exacerbated existing inequalities.

Low-wage service industry workers and people of color suffered the brunt of job losses. Government stimulus controls and an additional $ 600 a week in unemployment benefits helped soften the blow, supporting income and spending amid widespread unemployment.

Stimulus aid

The Supplemental Poverty Measure, which includes many government assistance programs, decreased 2.6 percentage points to 9.1% in 2020, the lowest since the measurement began in 2009. This rate is lower than the official poverty rate due to financial aid payments related to the pandemic, which lifted 11.7 million people out of poverty in the first two rounds of disbursements. Five million people were added to poverty due to medical expenses.

37.2 million people were living in poverty in 2020, 3.3 million more than a year earlier, the Census Bureau said. Consider that a household with two parents and two children with less than $ 26,246 of income lives in poverty; the measurement differs according to the size of the household.

The data shows that the official poverty measure is out of date and “cannot be used to examine public policy,” said David Johnson, a research professor at the University of Michigan Institute for Social Research and Ford School of Public Policy.

Dig deeper

  • Poverty rates increased among Hispanics and non-Hispanic whites. While the poverty rate among black people was the highest at 19.5% and the Asian rate also increased, both were not statistically significant changes from 2019.
  • About one in four people without a high school diploma were in poverty compared to less than 4% of people with a bachelor’s or higher degree
  • Women are even more likely to live in poverty at rates of 12.6% compared to 10.2% for men. The income ratio between women and men was 0.83, not statistically different from the 2019 ratio
  • For families with single female heads of household, 23.4% were in poverty compared to 11.4% of families headed by single men. Married couples saw the lowest poverty rates at 4.7%, slightly more than a year ago
  • Median incomes for white, Asian, and non-Hispanic Hispanic households decreased in 2020, while the changes for black households were not statistically different. Average real incomes fell in all regions of the country except the Northeast. All household income groups saw their incomes fall in 2020, except for the richest 5% of households.
  • Tuesday’s report also shows the proportion of Americans without health insurance at 8.6% last year, amounting to 28 million people. For people with health insurance coverage, 66.5% have private insurance and 34.8% have a public plan.

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