Poverty Rate Doubled in the Midwestern Rust Belt Over Past Decade

Nov 3, 2011 8:54pm

The Great Recession has changed the face of poverty in America.

More people – 46.2 million - live in poverty today than at any other time in American history. And compared to the 1990s they are more likely to be white, live in the Midwest, have a high school diploma and own a home, according to a Brookings Institute report released Thursday.

“This has been a really tough decade economically,” said Elizabeth Kneebone, an author of the Brookings Institute report. “After two economic downturns and falling incomes over the 2000s, we’ve seen that [poverty rate] push back up. It’s likely that we have not seen the last of the increases in America’s poor population.”

With manufacturing jobs disappearing and unemployment sticking above 9 percent, poverty rates in some Midwest cities, such as Detroit and Toledo, Ohio, have doubled over the last decade. And in the South, poverty in some metro areas, such as El Paso, Texas, and Baton Rouge, La., has increased by more than a third, according to the report.

“These communities tend to have higher crime rates, worse health outcomes for residents, schools are often poorer performing and there are fewer job opportunities and networks to connect people with jobs,” Kneebone said.

But despite these recent increases, America has seen darker days when it comes to people in poverty.

“Obviously we are not in a Great Depression,” said Linda Barrington, the managing director of Cornell University’s Institute for Compensation Studies. “We cannot make a comparison to what was happening then. But that doesn’t give us a lot to celebrate about.”

While there was no official poverty measure during the Great Depression, scholars estimate that about one-third of American families were critically poor. That is more than double the 15.1 percent poverty rate in 2010. However, because the population has nearly tripled since 1940, there is a larger number of Americans in poverty today than during the Great Depression.

“The point is [that] it is really high,” Barrington said. “But it’s not historically high.”

In fact, since an official poverty line was developed in the 1960s, the poverty rate has peaked above 15 percent only twice, in 1993, when it was also 15.1 percent, and in 1983, when it hit 15.2 percent.

To be classified as impoverished, a family of four has to earn less than $22,314 and an individual has to make less than $11,139, or about $30 per day.

“In the United States today, [poverty] doesn’t necessarily mean children starving in the streets and homeless people, although they are a small part of the poverty story,” said Shawn Fremstad, a senior research associate at the Center for Economic and Policy Research. “It is more about struggling, and running up debts, and cutting corners and all sorts of those things because of economic pressure.”

Both Fremstad and Barrington said the best way to lower the poverty rate is to jump-start the economy so it creates more jobs.

“The single most important thing is getting a job,” Barrington said. “If you’re poor and don’t have a job, you don’t have savings. You have to get money to get above the poverty line and you get money by working.”

While the national poverty rate is above 15 percent, only about 7 percent of people working full time are below the poverty line.

“You can get the rate down from 15 to 5 by getting a lot more people employed,” Barrington said. “So jobs are the first thing.”

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