The coronavirus pandemic last year left millions unemployed and caused the worst economic contraction since the Great Depression. However, the proportion of people living in poverty in the United States last year decreased by at least one measure due to the government’s enormous relief effort.
About 9.1 percent of Americans were poor last year, the Census Bureau reported Tuesday, 11.8 percent in 2019. This is based on a measure of poverty that explains the impact of government aid programs, which last year lifted millions out of poverty. The government’s official measure, which sets aside some major aid programs, rose to 11.4%, from a record low of 10.5% in 2019.
The fact that poverty has not increased further during a huge economic disruption reflects the government’s equally huge response. Congress expanded unemployment benefits and food aid, allocated hundreds of billions of dollars to small businesses, and sent direct checks to most American households. The Census Bureau estimated that direct controls alone lifted 11.7 million people out of poverty last year and that unemployment benefits prevented 5.5 million people from falling into poverty.
“Despite the pandemic, unemployment, recession, poverty did not increase,” said Irwin Garfinkel, co-director of the Center for Poverty and Social Policy at Columbia University School of Social Work, referring to the alternative measure. “If it hadn’t been for government benefits, poverty would have skyrocketed.”
Poverty rose much more sharply after the last recession, reaching 15.1% in 2010 and slowly improving thereafter.
However, government aid programs excluded some groups, such as undocumented immigrants and their families, and did not reach others. Millions of people suffered delays for weeks or months before receiving benefits, forcing many to seek help from food banks or other charities.
“We measure poverty annually, when faced with the reality of poverty on a day-to-day basis,” said Hilary Hoynes, an economist at the University of California, Berkeley, who has studied the government’s response to the pandemic.
Many of the programs that helped people avoid poverty last year have expired, although the pandemic continues. An estimated 7.5 million people lost their unemployment benefits this month after Congress allowed the pandemic-era program to expire.
The new data could feed into the efforts of President Biden and congressional leaders to enact a more lasting expansion of the safety net. The $ 3.5 trillion Democrats’ plan, which is still taking shape, could include paid family and medical leave, government-backed child care, and a permanent expansion of the children’s tax credit. Liberals said the success of relief programs last year showed that these policies should be continued and expanded.
“It tells us it works to grow up,” said Arloc Sherman, a poverty researcher at the Center on Budget and Policy Priorities, a progressive research group. “We had the answer all the time. These policies are extremely effective when actually used. ”
But many conservatives argue that while some expansion of government aid was adequate during the pandemic, these programs should be liquidated as the economy recovers.
“Concerns about poverty, which is at historic lows, needed to be balanced with concerns about federal debt,” said Scott Winship, a senior member and director of poverty studies at the American Enterprise Institute, a conservative group.