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Expiration of Pandemic Relief Led to Record Increases in Poverty and Child Poverty in 2022 | Center on Budget and Policy Priorities
End Notes
[1] Kris Cox et al., “About 16 Million Children in Low-Income Families Would Gain in First Year of Bipartisan Child Tax Credit Expansion,” CBPP, updated January 22, 2024, https://www.cbpp.org/research/federal-tax/about-16-million-children-in-low-income-families-would-gain-in-first-year-of.
[2] Chris Wimer et al., Historical Supplemental Poverty Measure Data, Columbia Population Research Center, 2017, https://www.povertycenter.columbia.edu/historical-spm-data. We accessed CPS data partly via IPUMS-CPS, University of Minnesota, www.ipums.org.
[3] Using a recent year’s SPM threshold and adjusting it back for inflation (using the Labor Department’s consumer price index retroactive series) creates an SPM series “anchored” to recent years’ poverty standards. Some analysts prefer the anchored SPM over the standard or “relative” SPM, which allows poverty thresholds to grow slightly faster than inflation as living standards rise across decades. This analysis uses an anchored series to ensure that trends are purely due to changes in families’ resources, not changes in the poverty thresholds. Chris Wimer et al., “Trends in Poverty with an Anchored Supplemental Poverty Measure,” Columbia Population Research Center Working Paper No. 13-01, December 2013, https://academiccommons.columbia.edu/doi/10.7916/D8RN3853. We anchor all poverty thresholds to 2022, the latest SPM threshold available. Figures in this report may differ from figures in previous CBPP reports that were anchored to an earlier year or from published Census figures, which are not anchored. Poverty declines less over the long term when a relative SPM poverty measure is used, but under both relative and anchored versions of the poverty measures, poverty rates reached record lows in 2020 and 2021, overall and for children.
[4] These figures account for all public benefits, including permanent programs such as Social Security, food assistance, rental vouchers, regular state unemployment insurance, Temporary Assistance for Needy Families (TANF), the EITC, and the Child Tax Credit, as well as pandemic programs such as stimulus payments and supplemental unemployment benefits and food assistance (net of federal and state income taxes and payroll taxes). Consistent with similar comparisons by the Census Bureau and other analysts, this comparison looks at the effect of assistance programs on family resources and presumes no change in behavior.
[5] In 2018 Census released data based on an updated processing system. To facilitate comparisons across time, Census released two versions of 2016 and 2017 data: one comparable to 2018 and the other comparable to earlier years. When making comparisons in this report, we use the appropriate version depending on the years being compared. For details on the changes in the Census survey, see Liana Fox, “The Supplemental Poverty Measure: 2018,” U.S. Census Bureau, October 2019, https://www.census.gov/content/dam/Census/library/publications/2019/demo/p60-268.pdf.
[6] Poverty rates for 2020 and 2021 were lower than for earlier years — and the anti-poverty impact of economic security programs was higher — to a degree that cannot be attributed to the change in survey methods. The 2017 poverty rate using thresholds anchored to 2022 was 14.6 percent when using the new methods and 15.5 percent when using the previous methods. Government assistance and taxes reduced poverty by 43 percent in 2017 when using the new methods and 41 percent when using the previous methods.
[7] Danilo Trisi, “Government’s Pandemic Response Turned a Would-Be Poverty Surge Into a Record Poverty Decline,” CBPP, August 29, 2023, https://www.cbpp.org/research/poverty-and-inequality/governments-pandemic-response-turned-a-would-be-poverty-surge-into.
[8] Irwin Garfinkel et al., “The Benefits and Costs of a Child Allowance,” Journal of Benefit-Cost Analysis, Vol. 13, Issue 3, Fall 2022, https://doi.org/10.1017/bca.2022.15; and Lisa A. Gennetian and Katherine Magnuson, “Three Reasons Why Providing Cash to Families With Children Is a Sound Policy Investment,” CBPP, May 11, 2022, https://www.cbpp.org/research/income-security/three-reasons-why-providing-cash-to-families-with-children-is-a-sound.
[9] National Academies of Sciences, Engineering, and Medicine, A Roadmap to Reducing Child Poverty, National Academies Press, 2019, https://www.nap.edu/read/25246.
[10] George Fenton, “New Study Finds Income Support in Childhood Increases Future Earnings,” CBPP, June 21, 2022, https://www.cbpp.org/blog/new-study-finds-income-support-in-childhood-increases-future-earnings; Martha J. Bailey et al., “Is the Social Safety Net a Long-Term Investment? Large-Scale Evidence From the Food Stamps Program,” National Bureau of Economic Research Working Paper 26942, April 2020, http://www.nber.org/papers/w26942.pdf.
[11] Arloc Sherman and Tazra Mitchell, “Economic Security Programs Help Low-Income Children Succeed Over Long Term, Many Studies Find,” CBPP, July 17, 2017, https://www.cbpp.org/research/poverty-and-inequality/economic-security-programs-help-low-income-children-succeed-over.
[12] This report uses the term “Latino” to refer to people of any race who identify as Hispanic or Latino in Census surveys. This language does not necessarily reflect how every member of this community would describe themselves. For example, gender-inclusive terms like “Latinx” and “Latine” have emerged in recent years to represent the diversity of gender identities and expressions in the community. Black, white, and AAPI refer to people of that race alone and not Latino.
AIAN people in this report may be AIAN alone or in combination with other races and ethnicities. This includes people who self-report as American Indian, Alaska Native, Canadian Indian, and Latin American Indian. For more, see Ana I. Sánchez-Rivera, Paul Jacobs, and Cody Spence, “A Look at the Largest American Indian and Alaska Native Tribes and Villages in the Nation, Tribal Areas and States,” U.S. Census Bureau, October 3, 2023, https://www.census.gov/library/stories/2023/10/2020-census-dhc-a-aian-population.html.
[13] The analysis uses Census Bureau estimates of income and payroll taxes. One notable limitation of Census’ tax estimates is that they do not account for restrictions on EITC and Child Tax Credit eligibility for filers or dependents who lack a Social Security number, which bars certain families that include immigrants from receiving these credits. Accounting for these restrictive policies would diminish the poverty-reducing role of government assistance shown here. For Latino children, we estimate that it would likely increase their poverty rate by approximately 1 or 2 percentage points.
Figures are rounded for ease of reading. Comparisons are based on unrounded figures.
[14] As noted, these data go back to 1970 for Black and Latino children and 1987 for AIAN children. See section on “Measuring Inequities in Poverty Rates” in Appendix I for a discussion of why we use percentage point differences to measure inequities in poverty rates.
[15] In 2019, the poverty rate for Black and Latino children was 14 percentage points higher than for white children, a record low at the time in data going back to 1970.
[16] Kris Cox et al., “Top Tax Priority: Expanding the Child Tax Credit in Upcoming Economic Legislation,” CBPP, updated June 12, 2023, https://www.cbpp.org/research/federal-tax/top-tax-priority-expanding-the-child-tax-credit-in-upcoming-economic.
[17] Danilo Trisi and Matt Saenz, “Economic Security Programs Reduce Overall Poverty, Racial and Ethnic Inequities,” CBPP, updated July 1, 2021, https://www.cbpp.org/research/poverty-and-inequality/economic-security-programs-reduce-overall-poverty-racial-and-ethnic.
[18] While combined Asian and Pacific Islander figures are available back to 1987, separate poverty data are available for Asians and Pacific Islanders (including Hawaiians) starting in 2002. In 2022, the SPM poverty rate for the combined AAPI population was 11.5 percent, for the Asian population was 11.4 percent, and for the Native Hawaiian and Other Pacific Islander population was 13.5 percent. Further breakdowns of the Asian population are limited by sample size in the Current Population Survey data used for this analysis, but poverty rates have been shown in larger surveys to vary widely across Asian origin groups. See Ziyao Tian and Neil G. Ruiz, “Key facts about Asian Americans living in poverty,” Pew Research Center, March 27, 2024, https://www.pewresearch.org/short-reads/2024/03/27/key-facts-about-asian-americans-living-in-poverty/.
[19] Although some broad annual indicators of hardship, including food insecurity as measured by the U.S. Department of Agriculture, were statistically unchanged in 2020 and 2021, a variety of other evidence points to an increase during the pandemic in the number of households experiencing at least sporadic trouble making ends meet. This includes year-over-year increases in requests for help with food (up 97 percent), shelter (42 percent), and utilities (31 percent), according to an analysis of calls to the United Way’s “211” help line; a 55 percent rise in the number of people using food banks since before the pandemic, according to the food bank network Feeding America; and a near doubling (from $8 billion to $15.8 billion) of customers’ total estimated arrearages on electricity bills between December 31, 2019 and December 31, 2020, according to state energy assistance program directors.
See Alisha Coleman-Jensen et al., “Household Food Security in the United States in 2021,” U.S. Department of Agriculture, Economic Research Service, ERR-309, September 2022, https://www.ers.usda.gov/webdocs/publications/104656/err-309.pdf; Rachel Garg, Balaji Golla, and Matthew Kreuter, “Year 1 of COVID-19: Needs rise 59%,” Washington University in St. Louis Health Communication Research Laboratory, March 29, 2021, https://hcrl.wustl.edu/year-1-of-covid-19-needs-rise-59/; Paul Morello, “The food bank response to COVID, by the numbers,” Feeding America, March 12, 2021, https://www.feedingamerica.org/hunger-blog/food-bank-response-covid-numbers; letter from National Energy Assistance Directors Association to Xavier Becerra, Secretary, U.S. Department of Health and Human Services, March 29, 2021, https://neada.org/wp-content/uploads/2021/04/LetterHHSReleaseofFundsARP.pdf.
[20] Nick Gwyn and Jenna Gerry, “Unemployment Insurance System Unprepared for Another Recession,” CBPP and National Employment Law Project, April 18, 2023, https://www.cbpp.org/research/economy/unemployment-insurance-system-unprepared-for-another-recession.
[21]Arloc Sherman et al., “Widespread Economic Insecurity Pre-Pandemic Shows Need for Strong Recovery Package,” CBPP, July 14, 2021, https://www.cbpp.org/research/poverty-and-inequality/widespread-economic-insecurity-pre-pandemic-shows-need-for-strong. U.S. child poverty rates would stand out less among peer nations if poverty were defined as one-half of U.S. median income rather than half of each nation’s own median income. That is because average and median incomes in the U.S. are particularly high. Its relatively high overall income also means that the U.S. has relatively high capacity to further reduce child poverty, should it choose to do so. For a recent analysis of child poverty rates across countries using multiple measures, see Zachary Parolin and Stefano Filauro, “The United States’ Record-Low Child Poverty Rate in International and Historical Perspective: A Research Note,” Demography, Vol. 60, Issue 6, December 2023, https://doi.org/10.1215/00703370-11064017. Note that their analysis also includes some nations that are less comparable to the U.S. in terms of income levels.
[22] Sharon Parrott, “The Nation Has Made Progress Against Poverty But Policy Advances Are Needed to Reduce Still-High Hardship,” CBPP, July 28, 2022, https://www.cbpp.org/research/poverty-and-inequality/the-nation-has-made-progress-against-poverty-but-policy-advances.
[23] OECD Family Database, PF1.1 Public spending on family benefits, https://www.oecd.org/els/family/database.htm.
[24] Chuck Marr, Samantha Jacoby, and George Fenton, “The 2017 Trump Tax Law Was Skewed to the Rich, Expensive, and Failed to Deliver on Its Promises,” CBPP, March 5, 2024, https://www.cbpp.org/research/federal-tax/the-2017-trump-tax-law-was-skewed-to-the-rich-expensive-and-failed-to-deliver.
[25] For a more detailed discussion of some data quality issues of the Current Population Survey (CPS), the main source for the poverty estimates that Census produces and those we present in this report, see Appendix I: Methodological Notes in Trisi, https://www.cbpp.org/research/poverty-and-inequality/governments-pandemic-response-turned-a-would-be-poverty-surge-into#appendix-i-methodological-notes-cbpp-anchor.
[26] U.S. Bureau of Labor Statistics, “2022 Research Supplemental Poverty Measure Thresholds,” September 7, 2023, https://www.bls.gov/pir/spm/spm_thresholds_2022.htm.
[27] Researchers who prefer the relative SPM note that it aligns more closely with the recommendations of the 1995 National Academy of Sciences committee whose work led to the SPM. The committee found that, over decades, the view of the poverty line — that is, the minimum amount of income needed to obtain basic needs — held by both the public and poverty experts tends to rise slightly faster than inflation but more slowly than typical income levels, and this evolution is best captured by changes in the amount typical families spend on food, clothing, shelter, and utilities. The committee recommended updating the poverty threshold annually based on changes in basic needs spending, as the relative SPM poverty measure does. For more information on the development of SPM thresholds, see the SPM website of the U.S. Bureau of Labor Statistics at https://www.bls.gov/pir/spmhome.htm.
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