Poverty Rate Decreases—But Still Not Time to Celebrate!

Income and Poverty in the United States: 2013

Data released by the Census Bureau on September 16, shows that the official poverty rate fell from 15% in 2012 to 14.5% in 2013, the first decrease since 2006. The data in this report come from the 2014 Current Population Survey Annual Social and Economic Supplement.

 As of 2013, there were 45.3 million people living at or below the poverty level, and for the third consecutive year, the change in the number of people living in poverty was not statistically significant. Furthermore, real median household income remained stagnant. The change from $51,759 in 2012 to $51,939 in 2013 was not statistically significant for the second year in a row, following two previous years of declines.

 A primary factor in the declining poverty rate was the significant decrease in the poverty rate for children under the age of 18, which fell for the first time since 2000. The poverty rate for children declined from 21.8% to 19.9% between 2012 and 2013, with the number of children living in poverty falling from 16.1 million to 14.7 million. Despite this improvement, the poverty rate for children remained higher than the rate of poverty among people aged 18 to 64, and those aged 65 or older. In addition, about 1 in 5 related children under age 6 remained in poverty. Little was changed in poverty rates among people over the age of 18.

The poverty rate among Hispanics fell from 25.6% in 2012 to 23.5% in 2013, and the number of Hispanics living in poverty decreased from 13.6 to 12.7 million. In comparison, there was not a statistically significant change in the poverty rate for non-Hispanic Whites (9.6%) or for non-Hispanic Blacks (27.2%).

 The report also shows that income inequality rose from 1999 to 2013. One way the Census Bureau measures income inequality is by comparing changes in household income at selected percentiles. Between 1999 and 2013, incomes declined 14.3% at the 10th percentile (at the lower end of the income distribution) and 8.7% at the 50th percentile, while there was no statistically significant change in income at the 90th percentile (at the upper end of the income distribution). Over the same time period, the ratio of the 90th percentile to 10th percentile income rose from 10.42 to 12.10, another indication of increasing income inequality.

Income and Poverty in the United States: 2013 is at http://www.census.gov/content/dam/Census/library/publications/2014/demo/p60-249.pdf

A media release from the Census Bureau summarizing the findings is at http://www.census.gov/newsroom/press-releases/2014/cb14-169.html

Marcie Cohen
Public Policy Committee

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