CRS: 'Likely Take Several Years or More Before Poverty Rates Recede’

CRS: 'Likely Take Several Years or More Before Poverty Rates Recede’

By Terence P. Jeffrey

A report from the Congressional Research Service says that it will “likely take several or more years” for the poverty rates in the United States to fall back to the levels they were before the last recession.

The number of people living in poverty in the United States hit a record last year, according to Census Bureau data cited by CRS, and the poverty rate remained stuck at its highest level in two decades.

“The 46.5 million persons counted as poor in 2012 is the largest number counted in the measure’s recorded history, which goes back as far as 1959, and the 2012 poverty rate of 15.0% is the highest seen since 1993,” said CRS in the report, which was published in November.

The continuation of high poverty rates, according to CRS, can be attributed to the ongoing slow pace of economic growth in the years following the last recession—which ended four years ago, when President Barack Obama was in his first year of office.

“The level of poverty tends to follow the economic cycle quite closely, tending to rise when the economy is faltering and fall when the economy is in sustained growth,” said CRS.

“This most recent recession, which officially ended in June 2009, was the longest recorded (18 months) in the post-World War II period," the report said. "Even as the economy recovers, poverty is expected to remain high, as poverty rates generally do not begin to fall until economic expansion is well underway. Given the depth and duration of the recession, and the projected slow recovery, it will likely take several years or more before poverty rates recede to their 2006 pre-recession level.”

What does “several years or more” mean?

The CRS suggests the current high level of poverty in the United States could persist until almost the end of the current decade because the economy will not grow fast enough to help the poor climb out of poverty.

“Little if any improvement in the level of ‘official’ U.S. poverty has been seen since the recession’s official end, with the poverty rate remaining at about 15% for the past three years,” said CRS. “Some analysts expect U.S. poverty to remain above pre-recession levels through much, if not most, of the remainder of the decade, given the slow pace of economic recovery.” Two groups that are particularly prone to poverty, according to the CRS report, are foreign-born individuals who are not citizens (as opposed to naturalized immigrants) and families headed by single women.

“In 2012, among the native-born population, 14.3% (38.8 million) were poor,” said CRS. “Among the foreign-born population, 19.7% (7.7 million) were poor in 2012.

"The poverty rate among foreign-born naturalized citizens (12.4%, in 2012) was lower than that of the native-born U.S. population," said the report. "In 2012, the poverty rate of non-citizens (24.9%) was about 10 percentage points above that of the native-born population (14.3%). In that year, the 5.4 million non-citizens who were counted as poor accounted for about one in nine of all poor persons (46.5 million).”

The report does not distinguish between non-citizen foreign-born individuals who are legally in the United States and those who are illegal immigrants.

The increase in children living in poverty in the United States coincides with an increase in the percentage of children living in household headed by single mothers. In fact, more than half of the children living in poverty in the United States  last year lived in families where there was no father.

“Children living in single female-headed families are especially prone to poverty,” said CRS.

“In 2012 a child living in a single female-headed family was well over four times more likely to be poor than a child living in a married-couple family," said the report. "In 2012, among all children living in single female-headed families, 47.2% were poor. In contrast, among children living in married-couple families, 11.1% were poor. The increased share of children who live in single female-headed families has contributed to the high overall child poverty rate.

"In 2012," said CRS, "one quarter (25.3%) of children were living in single female-headed families, more than double the share who lived in such families when the overall child poverty rate was at a historical low (1969). Among all poor children, well over half (56.1%) were living in single female-headed families in 2012.”