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More Than A Third Of Californians In or Near Poverty, Report Says

August 5, 2021 by Daniel Mollenkamp
People ride their bikes past a homeless encampment set up along the boardwalk in the Venice neighborhood of Los Angeles, Tuesday, June 29, 2021. The proliferation of homeless encampments on Venice Beach has sparked an outcry from residents and created a political spat among Los Angeles leaders. (AP Photo/Jae C. Hong)

SACRAMENTO, Calif. — A recent report says that more than a third of Californians are living below or near the poverty line, according to the latest available data. Without social safety net programs, the report further says, that figure would have been much higher. 

California, the most populated state in the country, has consistently been reported as one of the states with an exceptionally high poverty rate, which has led it to be called “the poverty capital of America.”

Figures from the U.S. Census Bureau put the official poverty rate for 2019 in the U.S. at 11.7%, and California is listed as a state with a higher poverty rate than the official rate, along with 15 other states including Texas, Florida, Colorado, and New York.

According to this new report, 16.4% of Americans, or about 6.3 million, couldn’t meet basic needs in 2019, the year the data was collected. Basic needs, in the report, is defined as $35,600 annually for a family of four.

The “deep poverty” level for that year, defined as having less than half of the resources for basic needs, was 4.6%, the report said. 

All told, 34% of Californians were poor or near-poor for the year, according to the report. 

Poverty rates vary enormously across the state. In local areas, the rates can swing dramatically from 5.1% to 40.3%. 

Yolo County, a county near the state capital Sacramento, and Los Angeles County in southern California, the most populated county in the U.S., had the highest poverty rates, at 20.9% and 20.8%, respectively. El Dorado County, which is also near the Sacramento area, had the lowest at 10.4%.

Poverty in California had declined in 2019, the year before COVID-19. For comparison, in 2018 the poverty rate was at 17.6%.

Researchers said that how the pandemic and its closures impacted poverty rates in California is still hard to quantify. 

While the COVID-19 outbreak certainly increased poverty rates because it restricted work, the economic support offered by state and federal responses, such as the 2020 CARES Act and the 2021 American Rescue Plan Act, may have taken some of the edge off, the report said.

Social safety net programs had a measurable effect on poverty rates in 2019. In total, they kept 12.2% of children in the state out of poverty and 6.6% of Californians in general, the report added.

In particular, the Earned Income Tax Credit was the most effective measure against poverty, according to the report, followed closely by CalFresh and the federal Child Tax Credit. 

This report was jointly produced by Public Policy Institute of California, an independent nonprofit research institution, and the Stanford Center on Poverty and Inequality. 

The report uses a different metric than the official poverty metrics. It uses the California Poverty Measure, which attempts to consider the cost of living and social safety net benefits. 

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