Economy

Poverty Rates at Lowest Levels Since 2008, Says New Census Report

Gains were across racial lines, though poverty remains a scourge for African Americans and Hispanics, and for many southern and southwestern states.

adult experienced industrial worker during heavy industry machinery assembling on production line manufacturing workshop
Photo Credit: Dmitry Kalinovsky

According to a new Census report, the number of Americans living below the poverty line declined by 3.5 million in 2015, bringing the total poverty rate to 13.5%. That's a 1.2% decline from 2014, the largest annual drop since 1999 and the lowest since the financial crisis of 2008. It took seven long years after the recession was supposedly over, but employers, according to a New York Times article on the Census report, were finally "compelled to reach deeper into the pools of untapped labor, creating more jobs, especially among retailers, restaurants and hotels, and paying higher wages to attract workers and meet rising minimum wage requirements." 

An economist the Times interviewed pointed to a confluence of factors that created 2.9 million more jobs, including employment and wage gains at the very bottom of the economic ladder, combined with successful campaigns for higher minimum wages that hit large states and major cities including New York and Los Angeles. Lower gas prices also helped ease the cost of commutes. Government programs like Social Security, the Earned Income Tax Credit, and SNAP (food stamps), perhaps to the dismay of conservatives, were also cited as key lifelines for people while the economy took its time catching up. 

The declines in poverty cut across multiple demographic groups including African-Americans and Hispanics, who according to the report experienced the largest improvements of any group (though they still make up 45% of families of four living below the poverty line in most states).  In terms of socio-economic groups, a White House analysis of the report clarified that the highest gains were at the bottom of the economic spectrum, including an increase of 5.5 percent for households at the 40th percentile and a nearly 8 percent increase for households at the 10th percentile. The rich still got richer, though not quite at the usual clip, with an increase of 2.9 percent in the 90th percentile of household income. 

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The improvement in poverty hits 23 states, but it remains entrenched in the South and Southwest, which emcompass many union-unfriendly "right to work" states, not to mention areas where local governments frequently cut aid to the kinds of programs that helped Americans learn essential skills, pay down debt, and feed their families while they worked hard for the new opportunities reflected in the data. These gains don't come in a vacuum, nor solely because of the private sector.

They're also not always sustainable. The Times rightly points out that "Many poor people, saddled with a deficient education, inadequate health care and few marketable skills, find small setbacks can quickly set off a downward spiral." The Census report may be rare good news, but more states will have to raise the minimum wage, more job training programs will have to open, and more companies will have to invest in their workers before we're truly out of the economic woods. 

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Ilana Novick is an AlterNet contributing writer and production editor.