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Top 10 Striking Findings from the Latest Data on Poverty

Millions of Americans Continue to Wrestle with Economic Hardship

Yesterday the Census Bureau released the latest data on poverty, income, and health insurance in America. The data confirm that millions of Americans continue to cope with the Great Recession’s enduring effects, and they show the strength of our safety net and our need for good jobs now.

Here are the top 10 most striking findings from the data:

1. Record numbers of people are poor and without health insurance. One out of every six Americans, or 46.2 million, lived in poverty in 2010. This is an increase of almost 3 million since 2009, and it’s now the highest number of people living in poverty since the Census started keeping track 52 years ago. Similarly, the number of Americans living without health insurance set a record high in 2010 at 49.9 million, up from 49 million in 2009.

2. More than a third of our population is living on a low income. In 2010, 103.6 million people were living below $44,000 for a family of four (two times the federal poverty line).

3. Income inequality increased from 2009 to 2010. Households in the bottom 20 percent by income saw their incomes fall by 4.5 percent, more than six times as much as the households in the top quintile.

4. Young people are getting hammered in this recession. More young adults (age 25-34) are moving in with their parents: 5.9 million young adults lived with their parents in 2010, up from 4.7 million before the recession. If you look at only the young adults’ income (instead of their parent’s income), the poverty rate among this group would be 45.3 percent. Households headed by a young person (age 15-24) saw the largest income decline of any age group as their income fell by more than 9 percent in the last year.

5. Racial and ethnic disparities widened in 2010. Poverty rates among African Americans and Hispanics, 27.4 and 26.6 percent respectively, are more than double that of whites, which is now 9.9 percent, up from 9.4 percent in 2009. African Americans and Hispanics also saw their incomes decline steeply from 2009 to 2010.

6. More than one out of every five children is living in poverty. For African American children, the poverty rate is nearly 40 percent, a stark contrast with the poverty rate among white children, which was 12.4 percent in 2010.

7. Some good news: Poverty did NOT significantly rise among seniors. This is a testament to the effectiveness of programs such as Social Security, which kept more than 20 million people, including nearly 14 million seniors, out of poverty last year.

8. The percentage of people receiving health insurance from their employers continues to decline. Approximately 1.5 million Americans lost their employer-sponsored health insurance in 2010. Yet programs such as Medicaid stepped up, covering 48.6 million people, and it mitigated the number of Americans who lost health coverage.

9. Safety net programs give needy families a leg up when they fall on hard times. Unemployment insurance, which provides critical support to the jobless and stimulates economic activity, kept 3.2 million Americans out of poverty in 2010. An alternative poverty measure that tracks the impact of the earned income tax credit shows that the EITC kept 5.4 million people, including 3 million children, from slipping below the poverty line last year.

10. Poverty affects everyone: While 15.1 percent of Americans lived in poverty last year, this number is only a snapshot. Throughout 2009, close to a quarter of Americans (23.1 percent) spent at least two months in poverty, and only 7.3 percent were in poverty the whole year. This tells us that the poor are not a static group and that widespread economic insecurity can push families into poverty for short spells. What’s more, these trends affect all of us. More people in poverty means fewer consumers for American goods and services, which slows our economic growth and costs us jobs. More people in poverty means less worker productivity, higher health costs, and a less-educated workforce to build the jobs and industries of the future. But it does not have to be this way.

So what do we do?

We can’t just throw up our hands and consign over 100 million people to poverty and hardship. We need to create good quality jobs, and do it now.

Congress should pass the American Jobs Act, which would help the 25 million Americans in need of full-time work and jump-start the economy. The American Jobs Act would extend benefits to the unemployed and create subsidized jobs for low-income youth and adults, benefiting millions of Americans but especially communities of color who have seen declining incomes paired with rising poverty and unemployment. The American Jobs Act would help children who are particularly hard-hit by providing needed aid to states and localities so that they can keep teachers in classrooms and modernize school buildings.

The data should also remind policymakers that we should not pursue deficit reduction that exacerbates growing poverty and inequality. The only good news out of the new data is that programs such as Medicaid, Medicare, unemployment insurance, SNAP/food stamps, the earned income tax credit, and Social Security are working to prevent further poverty and hardship. With low-income households and children bearing the brunt of the recession, it would be unconscionable to ask them to bear the brunt of deficit reduction by slashing the programs that support them when they fall on hard times. Instead, millionaires, billionaires, and our most profitable corporations need to contribute their fair share.

Congress and the Joint Select Committee on Deficit Reduction should take bold action to put people back to work and protect the most vulnerable. The time to act is now.

Katie Wright is the Special Assistant to the Half in Ten Campaign at the Center for American Progress.

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