DC Poverty Rate Dips Down

September 17, 2015

Hard on the results of the Census Bureau’s latest annual Current Population Survey supplement come the vastly more detailed results of its American Community Survey. As the headline says, they indicate what seems a drop in the overall poverty rate for the District of Columbia — down from 18.9% in 2013 to 17.7% last year.*

In human terms, this means that roughly 5,120 fewer District residents lived in poverty, as the Census Bureau’s official measure defines it.

At the same time, fewer residents lived in deep poverty, i.e., with household incomes no greater than 50% of the applicable poverty threshold — 9.1%, as compared to 10.3% in 2013.

These figures are obviously good news. But they’re hardly good enough to pop a champagne cork for. Several major reasons we should remain very concerned.

First, as I’ve said before, the poverty thresholds are extraordinarily low. A single parent and her two children, for example, were counted as poor only if the family’s pre-tax cash income was less than $19,073 — this in a city where the family’s basic needs cost roughly $104,000. Perhaps even more, as the DC Fiscal Policy Institute has noted.

Second, the District’s poverty rate is still high, even comparatively. The national poverty rate, according to the ACS, was 15.5% last year. The District’s poverty rate also exceeds all but 11 state-level rates.

Third, the poverty rate for children in the District is far higher than the rate for the population as a whole — 26% or more than one in four residents under 18 years old. The deep poverty rate for children is also higher — 12.4%.

True, these rates are lower than in 2013, when they were 27.2% and 16.2%. But we’ve got more children in the District now. So the rate dips — for plain vanilla poverty in particular — reflect less progress than they seem to.

Fourth, we still have large gaps among major race/ethnicity groups in the District — one, though far from the only sign of persistent income inequality, rooted in discriminatory policies and practices. For example:

  • The new poverty rate for blacks is 25.9%, as compared to 6.9% for non-Hispanic whites.
  • 12.7% of blacks lived in deep poverty, while only 4.8% of non-Hispanic whites did.
  • The rates for Hispanics fall in between, as they have in the past — 16.9% and 7.5%.

We find the same sort of divide in household incomes. The median for non-Hispanic white households was $117,134 — $57,512 higher than their median nationwide. The median household income for black residents was barely more than a third of what non-Hispanic whites here had to live on — $40,739.

For the poverty rates themselves, we can find some ready explanations in other ACS figures. For example, the poverty rate for District residents who were at least 25 years old and had less than a high school diploma or the equivalent was 33.7%, as compared to 5.8% for their counterparts with at least a four-year college degree.

Only a small fraction of working-age (16-64 year-old) residents who worked full-time, year round were officially poor — 2.1% — while 45.9% who lived in poverty didn’t work (for pay) at all.

They presumably include residents too disabled to work and dependent on Supplemental Security Income benefits. These, at a maximum, left a single individual about $3,660 below the poverty threshold.

But that leaves 23.4% who worked for at least part of the year, less than full time or both. They were not, by any means, all workers who chose part-time and/or temporary work, as a recent report by DCFPI and partners tells us.

The report includes some policy recommendations to help low-wage hourly workers who are now jerked around — and economically disadvantaged — by unpredictable, erratic work schedules. One can readily find other policy proposals that would, in various ways, significantly reduce poverty rates in the District and nationwide.

Though the ACS gives us new numbers, neither the story they tell nor the solutions they imply are new. Still worth knowing how the prosperity we witness in our gentrifying neighborhoods, as well as our traditionally upper-income havens has egregiously failed to reach so many District residents.

* All the ACS tables include margins of error, i.e., how much the raw numbers and percents could be too high or too low. For readability, I’m reporting both as given. However, the high side of the margin for the overall rate could mean no change from 2013.

 

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Economic Recovery Leaves Low-Income Working Families Behind

February 4, 2013

By the end of 2011, the official unemployment rate had dropped to 8.5%. The stock market seemed on its way to recovering the huge losses of 2008-9. The housing industry showed signs of life.

But the number of low-income working families rose to 10.4 million — up by 200,000 from 2010, according to a new brief from the Working Poor Families Project.

This means that nearly a third — 32.1% — of all working families struggled to make do with incomes below 200% of the Census Bureau’s applicable poverty threshold.*

The percent of low-income working families has steadily increased since 2007, when the recession set in. In that year, 28% of working families were poor or near-poor.

So we now have about 47.5 million people — 23.5 million of them children — in the group WPFP has carved out, i.e., those in families with children where the members who were at least 15 years old collectively worked a minimum of 39 weeks during the prior 12-month period.

What this tells us, of course, is that high unemployment doesn’t sufficiently account for the high poverty rate — or the more realistic 200% of that rate.

It does account for some part of it. According to the brief, the share of low-income families working dropped a bit between 2009 and 2011 — from 73% to 71%.

A larger part of the story seems to be the types of jobs those low-income family members had. About a fourth of the adults in these families worked in just eight occupations — all of them characteristically low-wage, e.g., cashiers, health aides, restaurant wait servers.

The brief tells us that many were working part-time — not by choice — and often in multiple temporary jobs.

But the data in the source it cites are very old. So we really don’t know how much cobbled-together, on-and-off employment boosted the number of working families who, at best, had barely enough to make ends meet.

We do know, however, that these working arrangements made them even more economically insecure than they would have been otherwise.

The rise in working poor families, as WPFP defines them, is another indicator of growing income inequality in the U.S.

While the poorest fifth were getting 5% of all income earned, the top fifth were getting 48% — not, in many cases, only income earned by the (figurative) sweat of their brows.

Looking at average incomes by education level, WPFP concludes that increasing the portion of workers with at least some postsecondary education “would go a long way toward narrowing the income gap.”

As I’ve written before, I find this doubtful, though it would surely move some of the low-income workers up from the bottom fifth.

We’d still have growth in low-wage occupations that can’t be fully automated or shipped overseas.

Employers won’t pay more merely because they can’t find enough qualified workers who’ve got, at most, a high school diploma or the equivalent. They won’t recreate the mid-wage jobs they’ve eliminated either.

WPFP seems to recognize this, since it also addresses job quality — and in terms that would apply mainly to low-wage occupations.

On the policy front, it recommends raising and indexing the minimum wage, mandating comprehensive paid sick and family leave, enforcing fair labor and other workplace standards and “ensuring that if public job creation expenditures persist, they benefit workers and their communities.”

All but the last would be easier for workers to gain for themselves if we had full employment again, i.e., a labor market with relatively few job seekers for jobs employers want to fill.

Economist Jared Bernstein, who’s long championed full employment as a policy goal, cites, only half in jest, the advantages workers gained when the “black death” plague swept Western Europe in the 14th century.

Well, we’re far from full employment. And happily no one’s predicting a plague. But it doesn’t look like we’re going to get public job creation expenditures.

What looms instead are job losses — at least a million, maybe over twice that — if Congress can’t agree to stop the briefly-delayed across-the-board spending cuts.

Same result — or perhaps worse — if it replaces them with equivalent cuts that shield defense, as the House majority wants.

And undoubtedly a much larger number if the Republicans succeed in forcing additional cuts on top of the $1.2 trillion already enacted the last time they ginned up a debt ceiling crisis.

This, as the WPFP brief indicates, would be a double-whammy for working poor families — not only an even worse labor market, but spending cuts in programs that help them meet basic needs and and become card-carrying members of the working middle class.

* Double the threshold for a two-adult, two-child family is $45,622.