Statement on Census Bureau’s 2014 Income, Poverty, and Health Coverage Reports

First Look at the Census Bureau’s 2014 Income, Poverty, and Health Coverage Reports:
Health Insurance Soars, But America’s Next Generation Still Live in Families Struggling to Make Ends Meet

(Note: In addition to this early look at the Census Bureau data released today, CLASP has published a detailed analysis with policy recommendations and infographic sheet.  CLASP perspectives on the new data have been included in a September 20 segment on C-SPAN’s Washington Journal and in an October 5 commentary in Washington Monthly.)

WASHINGTON, D.C.—According to the Census Bureau’s new poverty and income data, 14.8 percent of Americans were poor in 2014, statistically unchanged from 2013. No one should be complacent about these figures, particularly as America’s next generation of workers and citizens, including children (under 18) and young adults (ages 18 to 24), has the highest poverty rates—sharply exceeding the national average.

More than one in five (21.1 percent) children and almost one in five (19.8 percent) young adults live in households with incomes below the federal poverty line ($19,073 for a family with a single parent and two children).  The youngest children (under age 5), who are most vulnerable to the effects of poverty, experience an even higher rate (23.8 percent), as do Black children and young adults (37.1 percent and 29 percent respectively), Hispanic children and young adults (31.9 percent and 22.4 percent respectively), and young adults of any race or ethnicity who are also parents (43 percent). Children of color’s circumstances are particularly important; by 2020, they are expected to make up over 50 percent of the nation’s population of children, with children under age 5 having already reached this milestone.

The data also offer a snapshot of the crucial role that strong public policy can play. For example, 2014 was the first year in which the Affordable Care Act was fully implemented, and the share of Americans lacking health insurance coverage fell dramatically from 13.3 percent in 2013 to 10.4 percent in 2014. Young adults and low-income workers particularly benefitted, with adults ages 18 to 34 comprising over 40 percent of newly insured Americans. The Census also released an alternative measure, the Supplemental Poverty Measure (SPM), which shows the effect of non-cash transfers and taxes as well as work expenses and out-of-pocket medical costs. This analysis shows that refundable credits, such as the Earned Income Tax Credit and Child Tax Credit, reduced child poverty (as measured by the SPM) by 7.1 percentage points in 2014, while the Supplemental Nutrition Assistance Program (SNAP) reduced child poverty by 2.8 percentage points.

Yet the 2014 data show that economic struggles are pervasive for this generation of children and young adults. Almost half (more than four in ten) of all children and young adults live in low-income households that are below 200 percent of the poverty line. These families too often struggle to put food on the table and pay for basics like rent, mortgage, and utilities. America has a great deal at stake in a strong policy response to help these families succeed, given the research evidence that growing up with inadequate income and  opportunity can stunt children’s and young adults’ education and careers—and  the future importance of these young people as today’s older Baby Boomers retire.

Most of these struggling families are working yet still can’t make ends meet.  Nearly 70 percent of poor children and over 80 percent of the larger group of low-income children live in families with at least one worker. More than half of low-income families with children have a full-time, full-year worker. Without strong policy guarantees including a higher minimum wage,  family and medical leave, paid sick days, along with scheduling policies that give workers some measure of predictability, too many families work long hours yet still can’t create stability for their children—like one of the homeless mothers Pope Francis will meet in Washington, D.C. next week who is working one part-time job  and has just added a second to try to support herself and her two-year-old daughter.

The Census data also shine a light on the stark disparities in poverty and income by race and region of the country.  While overall poverty (for all ages) is highest in the South (16.5 percent), lower in the Midwest (13 percent), and lowest in the Northeast (12.6 percent), this pattern varies greatly across racial and ethnic groups. The poverty rate for African-Americans peaks at 30.9 percent in the Midwest compared to 21.5 percent in the Northeast, while Americans of Hispanic origins fare similarly across all regions—22.8 percent are poor in the West, 23.7 percent in the South and 25.3 percent in Northeast. Unfortunately, areas with high concentrations of poverty make it far harder for both children and adults to move ahead—for example, because high-poverty schools are far less likely than other schools to provide the basic college preparatory courses.

These data show an urgent need to address poverty and near-poverty among the next generation of Americans—but also demonstrate, through the striking health insurance results, that the United States remains able to meet large policy challenges when we face them head-on. When Pope Francis arrives next week, he is widely expected to repeat his call to carry “the burdens of the weakest and poorest among us.” The new poverty data suggest both that he is right to advocate strongly for a policy response offering solutions and that major progress is within our capacity. Congress must take responsibility for a Federal budget that invests in the crucial safety net, work supports, child care, education, workforce development, and other programs that deliver the goal of economic stability for all America’s families—so that children’s life opportunities don’t depend on their race, ethnicity, or where they are born. America’s economic future must not be sabotaged by the failure to invest in a whole generation.