September 13, 2022

U.S. Census Bureau: Child poverty declined between 2020 and 2021

By Olivia Winslow

September 13, 2022

Read on Newsday

The nation’s child poverty rate declined between 2020 and 2021, and, by one measure, fell to a record low, the U.S. Census Bureau reported Tuesday in releasing data on median household income, poverty rates and health insurance coverage.

One local economist, John Rizzo, a professor at Stony Brook University, called the child poverty rate decline “striking” and “good news.”

The bureau also said there was no statistically significant change in “real median household income” in 2021 compared with 2020; nor was there a statistically significant change in the overall poverty rate during the period.

The “real median household income” for the nation was $70,784 in 2021, not a statistically significant difference from the 2020 estimate of $71,186, the bureau said. The income data is in real 2021 dollars and reflect changes in the cost of living, officials said. 

The bureau also reported more people had health insurance in 2021 than in 2020. It said an estimated 8.3%, or 27.2 million people, did not have health insurance at any point in 2021, compared with 8.6%, or 28.3 million, in 2020.

Two poverty rate reports were issued by the bureau: the official poverty measure, which includes pretax income; and the supplemental poverty measure, which includes resources from government programs and tax credits to low-income families. The supplemental measure also takes into account geographic differences in costs that affect poverty threshold levels, whereas the official measure uses the same threshold across all regions.

The official poverty measure sets the poverty threshold for a family of two adults and two children at $27,479, which Long Island officials have said is inadequate for a high-cost region, such as Nassau and Suffolk counties.

Rebecca Sanin, president and chief executive of the Health and Welfare Council of Long Island, said in an email: “First, I think it’s really important to mention about [a third] of Long Islanders struggle to meet their basic necessities even with incomes far above the poverty line.”

Under the official poverty measure, the nation’s poverty rate was 11.6% in 2021, or 37.9 million people, not statistically different from 2020s rate of 11.5%, or 37.5 million. The supplemental measure, however, showed a statistically significant change, with a 7.8% poverty rate in 2021, a decrease of 1.4 percentage points from 2020. “This is the lowest SPM poverty rate since estimates were first published,” the bureau said in a report. The supplemental poverty measure estimates date back to 2009.

Bureau officials said the supplemental child poverty rate was the lowest on record. Liana Fox, the bureau’s assistant chief of economic characteristics, said: “SPM child poverty rate was nearly cut in half in 2021, going from 9.7% [in 2020] to 5.2%.” The official poverty rate for children under 18 was 16% in 2020, dropping to 15.3% in 2021. “The difference in year-year changes between the two measures is largely driven by the impact of stimulus payments and the expansion of the Child Tax Credit, as these additional resources are only considered in the SPM,” the bureau said in a report.

The poverty rate for the 65 and over population rose, however, to 10.3% in 2021, from 8.9% in 2020. Fox said, “a larger share are on fixed incomes” that likely “aren’t keeping pace with inflation.”

Rizzo called the supplemental poverty measure the “better measure” of poverty than the official measure, which hasn’t been updated since the 1960s. Noting the “dramatic decline between 2020 and 2021” in child poverty, Rizzo also cited increased government subsidies and the child tax credit. 

Said Sanin: “The evidence was very clear that the impact of the child tax credit for children and families was significant — reducing poverty, enabling families to meet basic needs, reducing food insecurity and strengthening families’ financial position to meet the challenges of living in a region with our high cost of living.”

The bureau’s statistics are based on its Current Population Survey Annual Social and Economic Supplement.

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