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2014 Poverty Data: What New Data from the U.S. Census Tells Us about Deep Poverty, Income and Equity in America

  ·  Megan Martin and Rosalynd Erney

Earlier today, the U.S. Census Bureau released its 2014 estimates on income, poverty and health insurance coverage in the United States. The official poverty rate for 2014 was 14.8 percent, a statistically insignificant change from 14.5 percent in 2013 but still far above the pre-recession rate of 12.5 percent in 2007.

Children and families of color continued to see disproportionately higher rates of poverty in 2014. Additionally, female-headed households faced higher rates of poverty than those of male-headed households or of married-couple families.

Poverty Highlights

  • The change in the poverty rate for children under 18 was not statistically significant—from 19.9 percent in 2013 to 21.1 percent in 2014—with 15.5 million children living in poverty.
  • The 2014 poverty rates among non-Hispanic Whites and Asians were 10.1 percent and 12.0 percent respectively, and the poverty rates for Blacks and Hispanics were 26.2 percent and 23.6 percent respectively.
  • The poverty rates for Black and Hispanic children, at 37.1 percent and 31.9 percent respectively, were significantly higher than their non-Hispanic White and Asian peers, who faced poverty rates of 12.3 percent and 14.0 percent respectively.
  • The poverty rate for families (households – not householder) was 12.7 percent, not significantly different from the rate in 2013 (12.4 percent).
  • The poverty rate for families with a female head of household (no husband present) remained unchanged from 2013 at 30.6 percent, while the poverty rate for families with a male householder (no wife present), also remained unchanged, at a significantly lower rate of 15.7 percent.
  • The poverty rate for children in female-headed households was four times the rate for children in married-couple families, at 46.5 percent and 10.6 percent respectively.

Income Highlights

Though the official median income in 2014 did not differ significantly statistically from 2013, Black and Hispanic individuals and families continued to face significant income disparities compared with their non-Hispanic White and Asian counterparts. Furthermore, women of color, particularly Black and Hispanic women, continued to face significantly lower earnings than their male counterparts.

  • The median household income in 2014 was $53,657, a statistically insignificant change from 2013. 
  • The real median income of non-Hispanic White households ($60,256) decreased by 1.7 percent while that of Black ($35,398), Asian ($74,297) and Hispanic ($42,491) households remained relatively the same.
  • In 2014, the median earnings of all women who worked full time, year-round ($39,621) was 79 percent of that for men working full time, year-round ($50,383). This ratio was not statistically different from that of 2013, but varied drastically when factoring in the median earnings of Black ($31,229) and Hispanic ($26,810) women who worked full time in 2014.

Health Insurance Highlights

2014 represents the first year in which the Affordable Care Act (ACA) was fully implemented. As a result, the share of Americans lacking health insurance coverage fell dramatically from 13.3 percent in 2013 to 10.4 percent in 2014. The report released today considered people “insured” if they were covered by any type of health insurance for all or part of the previous calendar year. It showed a significant increase in coverage for both Black and Hispanic people. The states that expanded Medicaid experienced significant drops in their uninsured population.

  • The rate of private coverage increased by 1.8 percent to 66.0 percent in 2014, and the government coverage rate increased by 2.0 percent to 36.5 percent.
  • Young adults between the ages of 18 and 34 accounted for more than 40 percent of newly insured Americans.
  • In 2014, the uninsured rate for non-Hispanic White populations was 7.6 percent, compared with 11.8 percent for Black, 9.3 percent for Asian and 19.9 percent for Hispanic populations. Black and Hispanic populations saw the most significant decrease, with both groups seeing their uninsured rate decrease by 4.5 and 4.1 percent, respectively.

Supplemental Poverty Measure Highlights

For the first time, along with the official data, the Census Bureau released data from the Supplemental Poverty Measure (SPM), which takes into account cash income, public benefits and subtracts necessary expenses. The official poverty measure is based on only pre-tax money income, and SPM also considers the value of in-kind benefits, including the Supplemental Nutrition Assistance Program (SNAP), school lunches, housing assistance and refundable tax credits. Additionally, the supplemental poverty measure deducts necessary expenses for crucial goods and services, including taxes, child care, transportation costs and out-of-pocket medical expenses.

According to the SPM:

  • The supplemental poverty rate was 15.3 percent, not a statistically significant change from 2013.
  • The supplemental poverty rate for children, taking into account tax credits and noncash benefits, was 16.7 percent—far lower than the official child poverty rate of 21.1 percent.
  • The top three federal benefit programs that reduced poverty in 2014 were Social Security, refundable tax credits and SNAP. Each program reduced the supplemental poverty rate by 8.2 percent, 3.1 percent and 1.5 percent, respectively.
  • The greatest increases to the supplemental poverty rate were caused by work expenses (accounting for a 2.0 percent increase) and out-of-pocket medical expenses (accounting for a 3.5 percent increase).

Deep Poverty

The data released today show that 46.7 million people are living in poverty in the United States, of which 20.8 million are living in deep poverty—at or below 50 percent of the poverty threshold. Significant disparities in deep poverty exist for communities of color, as Black and Hispanic populations faced deep poverty rates of 12.0 percent and 9.6 percent respectively, compared with 5.6 percent for both Asian and non-Hispanic White populations.

Children and families living in deep poverty often face significant barriers to accessing the programs that are designed to lift people out of poverty. Today’s data show that in comparison with the 62.4 percent of those living at twice the poverty line who receive benefits from means-tested programs, only 13.8 percent of families in deep poverty receive these same benefits.

The Important Role of Public Policy in Supporting Children and Families in Deep Poverty

Children and families in deep poverty face significant, wide-ranging and intersecting barriers, including homelessness, immigration status, mental or physical impairments, substance abuse or addiction and/or intellectual disabilities. These barriers compound the challenges experienced by many poor families including access to child care and/or transportation. Public policy should provide targeted and readily available supports that address all these barriers to successfully meet the needs of families living in deep poverty.

Policies that create incentives to serve families in the greatest need, reduce barriers to service eligibility and access and set aside slots for families living below the poverty threshold are all ways policy can better meet the needs of families in deep poverty. For example, letting parents who have lost their employment maintain their child care subsidy provides a necessary support in finding and starting a new job while also ensuring continuity for their young child. Efforts that are targeted at meeting the needs of children and their parents are important in trying to break the often intergenerational problem of deep poverty.

The Need for a Focus on Equity 

The poverty data released today indicate children and families of color continue to face disproportionately higher poverty rates and lower incomes when compared with White families, which has been consistent for more than three decades. Black children were two times more likely to face deep poverty than White children and more than three times more likely than Asian children. Deep poverty rates for Black children are 18.2 percent, Hispanic children 12.9 percent, Asian children 4.9 percent and White children 7.4 percent. This inequity shows the need for innovative solutions and targeted public investments, especially for children and families living in deep poverty. Policy strategies should take into account the existence of disparate opportunities and outcomes. The entire community benefits from policy strategies and solutions that focus on equity.

For more strategies to improve outcomes for children and families of color, read our recent report Achieving Racial Equity or visit PolicyforResults.org.

 

Posted In: Poverty and Economic Stability, Well-Being, Data