Census Bureau Says US Poverty Rate Surged as Pandemic Aid Ended
WASHINGTON — The nation’s poverty rate increased dramatically last year as inflation drove up the cost of living and federal aid programs created to help families weather the coronavirus pandemic were allowed to expire, the Census Bureau said on Tuesday.
The bad news came in three reports released by the bureau Tuesday morning: Income in the United States: 2022, Poverty in the United States: 2022, and Health Insurance Coverage in the United States: 2022.
They show the supplemental poverty rate rose to 12.4% in 2022, up from 7.8% in 2021 — the largest one-year increase on record, the bureau said.
Young people were particularly hard hit, with poverty among children more than doubling to 12.4% from a record low of 5.2% a year earlier.
The sobering reports elicited a swift response from the White House, where President Joe Biden said it showed “the dire consequences of congressional Republicans’ refusal to extend the enhanced Child Tax Credit, even as they advance costly corporate tax cuts.
“We cut child poverty by nearly half to record lows for all children in this nation largely by expanding the Child Tax Credit,” Biden said. “Last year, congressional Republicans insisted on raising taxes on families with children.
“The rise reported today in child poverty is no accident — it is the result of a deliberate policy choice congressional Republicans made to block help for families with children while advancing massive tax cuts for the wealthiest and largest corporations,” he continued.
On Capitol Hill, meanwhile, Sens. Cory Booker, D-N.J., Michael Bennet, D-Colo., and Sherrod Brown, D-Ohio, along with Reps. Rosa DeLauro, D-Conn., and Suzan DelBene, D-Wash., announced a press conference for Wednesday afternoon at which they said they will “highlight the skyrocketing child poverty rate and urge Congress to restore the expanded, enhanced Child Tax Credit.”
The lawmakers went on to note that in November 2022 the Senate Joint Economic Committee released a report highlighting that the expanded CTC in the American Rescue Plan Act lifted 5.3 million people, including 2.9 million children, out of poverty last year.
Late last year, Booker and his colleagues unsuccessfully urged their colleagues in Congress not to pass tax breaks for corporations without passing an expanded Child Tax Credit.
In early June, DeLauro, DelBene and Rep. Ritchie Torres, D-N.Y., reintroduced the American Family Act to restore the expanded and improved monthly Child Tax Credit with 207 co-sponsors.
Later that month, Booker, Bennet and Brown introduced their Working Families Tax Relief Act, a companion bill, to restore the expanded Earned Income Tax Credit and Child Tax Credit.
The president and the lawmakers all vowed to continue to fight to restore the expanded Child Tax Credit to, as Biden said, “give tens of millions of families the tax relief and breathing room they deserve.”
The statistics causing the most heartburn from the Census Bureau reports Tuesday stem from its “Supplemental Poverty Measure,” which factors in the impact of government assistance and geographical differences in the cost of living.
“This increase can be attributed to key changes in federal tax policy, including the expiration of temporary expansions to the Child Tax Credit and the Earned Income Tax Credit as well as the end of pandemic-era stimulus payments,” the agency said in a release accompanying the reports. “This is the first increase in the overall SPM poverty rate since 2010.”
The census bureau added that without taking cost of living and other factors into account, the official poverty rate in 2022 stood at 11.5%, which was not “significantly different from 2021.”
In all, it said, about 37.9 million Americans lived in poverty last year.
The Census Bureau establishes a poverty threshold based on a formula promulgated by the Office of Management and Budget that is updated for inflation using the Consumer Price Index — in other words, the cost of essentials, like food, clothing and housing.
In 2022 the poverty threshold for a family of four was $29,678, the bureau said.
Higher prices didn’t just hit the poor.
The Census Bureau reported Tuesday that median household income, adjusted for inflation, fell 2.3% in 2022, from $76,330 to $74,580. The numbers suggest that while employment numbers and wages were going up during the same period, they were simply no match for the 7.8% rise in inflation between 2021 and 2022, the largest annual increase in the cost-of-living adjustment since 1981.
The real median earnings of all workers (including part-time and full-time workers) decreased 2.2% between 2021 and 2022, while median earnings of those who worked full-time, year-round decreased 1.3%.
Between 2021 and 2022, the number of full-time, year-round workers increased by 3.4%, compared to a 1.7% increase in the number of total workers.
The Census Bureau went on to say that real median household incomes in White and non-Hispanic White households experienced a decrease between 2021 and 2022 (3.5% and 3.6%, respectively).
The real median incomes for Black, Asian and Hispanic households were not statistically different from 2021.
Asian households had the highest median income ($108,700) in 2022, followed by non-Hispanic White ($81,060) households and Hispanic ($62,800) households. Black households had the lowest median income ($52,860).
Tuesday’s reports also showed that more people were insured in 2022 than 2021.
In 2022, 92.1% of people, or about 304 million Americans, had health insurance at some point during the year, representing an increase in the insured rate and number of insured from 2021 (91.7% or 300.9 million).
In 2022, private health insurance coverage continued to be more prevalent than public coverage, at 65.6% and 36.1%, respectively. Some people may have more than one coverage type during the calendar year.
Of the more common subtypes of health insurance coverage, employment-based insurance was the most prevalent, covering 54.5% of the population for some or all of the calendar year, followed by Medicaid (18.8%), Medicare (18.7%), and direct-purchase coverage (9.9%).
Between 2021 and 2022, the rate of Medicare coverage increased by 0.3 percentage points to cover 18.7% of people. This increase was in part due to growth in the number of people aged 65 and older.
The uninsured rate among working-age adults ages 19 to 64 decreased 0.8 percentage points to 10.8% between 2021 and 2022, driven in part by a decrease in uninsured rates for workers.