West News Wire: The number of Americans living in poverty climbed significantly last year, especially among children, as a result of rising living expenses and the expiration of federal assistance programmes for families affected by the pandemic. 

The Census Bureau reported on Tuesday that the poverty rate increased to 12.4% in 2022 from 7.8% in 2021, the greatest one-year increase on record. Compared to the previous year, when it had reached a record low of 5.2 percent, child poverty has more than doubled, rising to 12.4%. These numbers come from the Supplemental Poverty Measure, which takes into account the influence of government aid and regional variations in cost of living. 

The rises came after two years of historically significant poverty declines, which were mostly fueled by safety net initiatives that were developed or expanded in response to the epidemic. These included a number of household direct payments in 2020 and 2021, improved nutrition and unemployment benefits, higher rental aid, and an extended child tax credit, which momentarily gave families with children a guaranteed income. 

Despite a robust job market and a growing economy, nearly all of those programmes had ended by last year, leaving many families struggling to keep up with rising expenses. With the important exception that financial difficulty has decreased among Black households due to rising incomes in recent years, overall poverty today resembles that of 2019 in many ways. 

A temporary hold on Medicaid terminations, which let the programme to cover more Americans than ever before, was one epidemic programme that did not expire. Due to this programme, the percentage of Americans without health insurance last year matched a historic low of 7.9%. States, however, are ending that interim insurance, and it is likely that this is why the uninsured rate has risen recently. 

The issue last year was exacerbated by the rising expense of living. The poverty line, which is based on the price of necessities like food and shelter, increased significantly: Under the supplemental measure, a family of four living in a rental house was considered poor if the family’s income was less than $34,518 in 2022, up from $31,453 in 2021. 

Prices rose for everyone, not just the poor. The impact of increased employment and rising earnings was outweighed by the fastest inflation since 1981, which caused the median household income, adjusted for inflation, to decline by 2.3 percent in 2022 to $74,580. 

“People are working hard,” said Margaret O’Conor, the head of Common Pantry, a modest food pantry in Chicago. “They’re simply struggling to pay their bills; the cost of living is too high.” Many people’s spare income, in particular, has been devoured by rent. 

Similar to other food banks, Common Pantry experienced an increase in demand during the pandemic, followed by a decline in demand in 2021 as a result of stimulus payments, improved unemployment benefits, and the child tax credit, among other forms of aid. Then, as those programmes ended, demand started to increase once more. 

All consumers’ prices increased, not just the poor. The highest inflation since 1981 exceeded the effects of growing employment and rising wages, resulting in a 2.3 percent fall in the median household income, adjusted for inflation, to $74,580 in 2022. 

Margaret O’Conor, the director of Chicago’s Common bank, a small food bank, remarked, “People are working hard.” “They’re just having a hard time making ends meet; living expenses are too high.” Rent has particularly ravaged many people’s extra money. 

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Like other food banks, Common Pantry saw a rise in demand during the epidemic, which was followed by a drop in need in 2021 as a result of stimulus payments, enhanced unemployment benefits, and the child tax credit, among other forms of aid. Then, as those programmes ended, demand started to increase once more. 

Children of immigrants, the fastest-growing segment of young people in America, have poverty rates that are more than twice as high as those of other kids. The obstacles their families must overcome to receive aid aren’t helpful. 

There hasn’t been much advancement in the 50 years since the United States’ war on poverty. A social scientist provides a fresh reason for an impasse. 

In comparison to their more affluent peers, underprivileged kids and teenagers nationwide take part in considerably fewer sports and fitness activities. 

2022 “just threw us,” claimed Ms. O’Conor. “It was not what we expected. No food pantry, in my opinion, really anticipated it. 

In a blog post introducing the report, the White House said that more recent data “tell a more optimistic story.” Inflation has cooled in recent months, while the job market has remained strong and wages continue to rise. 

For those able to take advantage of it, the heated job market has clearly had advantages. In 2022, many workers, particularly in low-paid sectors like hospitality and retail, benefited from large wage increases. Workers were able to hold out for better-paying jobs because to generous cash payments and unemployment benefits. After accounting for tax credits and various other government benefits, the income of the poorest 20 percent of households increased by 4.3 percent in 2017. For those with the least education, income growth also outpaced inflation. 

For women, the effects were more noticeable. The percentage of working women who were employed full-time for the entire year rose to 65.6%, the greatest level ever, which also made it possible for real earnings to decline for women more slowly than for males. 

The situation was less favourable for Americans over 65, whose poverty rate increased to 14.1% despite an 8.7% increase in Social Security benefits to reflect cost of living increases. Older people’s labour force participation is still low, in part because many have had trouble finding employment after losing their jobs. 

Jess Maurer, executive director of the Maine Council on Ageing, claimed that “people experienced significantly more health problems and increased levels of social isolation.” “Older people had a harder time recovering from the pandemic and reintegrating into society.” 

Inequality, as measured by the gap in pretax income between the richest and poorest 10 percent of households, narrowed, as most of the decrease in median incomes came from those at the middle and top of the wage distribution. Racial gaps also shrank, as white households lost ground to inflation, while inflation-adjusted income was little changed for other racial and ethnic groups. 

The quick increase in poverty after the programmes’ expiration, according to detractors of the child tax credit and other pandemic relief, is proof that the recent progress against poverty was essentially manufactured. The normal child tax credit and other work-incentive programmes, according to economist Michael Strain of the conservative American Enterprise Institute, have produced more long-lasting benefits. 

Yes, this reduced kid poverty, but it didn’t actually do anything to promote self-sufficiency, according to him.


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