WASHINGTON, Sept. 24 The proportion of Americans living in poverty
rose significantly last year, increasing for the first time in eight years, the
Census Bureau reported today. At the same time, the bureau said that the income
of middle-class households fell for the first time since the last recession ended,
The Census Bureau's annual report on income and poverty provided stark evidence
that the weakening economy had begun to affect large segments of the population,
regardless of race, region or class. Daniel H. Weinberg, chief of income and poverty
statistics at the Census Bureau, said the recession that began in March 2001 had
reduced the earnings of millions of Americans.
The report also suggested that the gap between rich and poor continued to
All regions except the Northeast experienced a decline in household income,
the bureau reported. For blacks, it was the first significant decline in two decades;
non-Hispanic whites saw a slight decline. Even the incomes of Asians and Pacific
Islanders, a group that achieved high levels of prosperity in the 1990's, went
down significantly last year.
"The decline was widespread," Mr. Weinberg said.
The Census Bureau said the number of poor Americans rose last year to 32.9
million, an increase of 1.3 million, while the proportion living in poverty rose
to 11.7 percent, from 11.3 percent in 2000.
Median household income fell to $42,228 in 2001, a decline of $934 or 2.2
percent from the prior year. The number of households with income above the median
is the same as the number below it.
A family of four was classified as poor if it had cash income less than $18,104
last year. The official poverty levels, updated each year to reflect changes in
the Consumer Price Index, were $14,128 for a family of three, $11,569 for a married
couple and $9,039 for an individual.
The bureau's report is likely to provide fodder for the Congressional campaigns.
The White House said the increase in poverty resulted, in part, from an economic
slowdown that began under President Bill Clinton. But Democrats said the data
showed the failure of President Bush's economic policies and his tendency to neglect
Mr. Bush said today that he remained optimistic. "When you combine the productivity
of the American people with low interest rates and low inflation, those are the
ingredients for growth," Mr. Bush said.
But Senator Paul S. Sarbanes, Democrat of Maryland, said the administration
should "start paying attention to the economic situation." Richard A. Gephardt
of Missouri, the House Democratic leader, expressed amazement that Mr. Bush, after
being in office for 20 months, was still blaming his predecessor.
Rudolph G. Penner, a former director of the Congressional Budget Office, said:
"The increase in poverty is most certainly a result of the recession. The slow
recovery, the slow rate of growth, has been very disappointing. Whether that has
a political impact this fall depends on whether the election hinges on national
conditions or focuses on local issues."
Although the poverty rate, the proportion of the population living in poverty,
rose four-tenths of a percentage point last year, it was still lower than in most
of the last two decades. The poverty rate exceeded 12 percent every year from
1980 to 1998. As the economy grew from 1993 to 2000, the rate plunged, to 11.3
percent from 15.1 percent, and the poverty rolls were reduced by 7.7 million people,
to 31.6 million.
The latest recession showed an unusual pattern, seeming to raise poverty rates
among whites more than among minority groups, Mr. Weinberg said.
Increases in poverty last year were concentrated in the suburbs, in the South
and among non-Hispanic whites, the Census Bureau said. Indeed, non-Hispanic whites
were the only racial group for whom the poverty rate showed a significant increase,
to 7.8 percent in 2001, from 7.4 percent in 2000.
Poverty rates for minority groups were once much higher. But last year, the
bureau said, they remained "at historic lows" for blacks (22.7 percent), Hispanics
(21.4 percent) and Asian Americans (10.2 percent).
With its usual caution, the Census Bureau said the data did not conclusively
show a year-to-year increase in income inequality. But the numbers showed a clear
trend in that direction over the last 15 years.
The most affluent fifth of the population received half of all household income
last year, up from 45 percent in 1985. The poorest fifth received 3.5 percent
of total household income, down from 4 percent in 1985. Average income for the
top 5 percent of households rose by $1,000 last year, to $260,464, but the average
declined or stayed about the same for most other income brackets.
Robert Greenstein, executive director of the Center on Budget and Policy Priorities,
a liberal research institute, said, "The census data show that income inequality
either set a record in 2001 or tied for the highest level on record."
Median earnings increased 3.5 percent for women last year, but did not change
for men, so women gained relative to men.
"The real median earnings of women age 15 and older who worked full time year-round
increased for the fifth consecutive year, rising to $29,215 a 3.5 percent
increase between 2000 and 2001," Mr. Weinberg said. The comparable figure for
men was unchanged at $38,275. So the female-to-male earnings ratio reached a high
of 0.76. The previous high was 0.74, first recorded in 1996.
Democrats said the data supported their contention that Congress should increase
spending on social welfare programs, resisted by many Republicans. But Wade F.
Horn, the administration's welfare director, said the number of poor children
was much lower than in 1996, when Congress overhauled the welfare law to impose
strict work requirements.
Of the 32.9 million poor people in the United States last year, 11.7 million
were under 18, and 3.4 million were 65 or older. Poverty rates for children, 16.3
percent, and the elderly, 10.1 percent, were virtually unchanged from 2000. But
the poverty rate for people 18 to 64 rose a half percentage point, to 10.1 percent.
Median household income for blacks fell last year by $1,025, or 3.4 percent,
to $29,470. Median income of Hispanics, at $33,565, was virtually unchanged. But
household income fell by 1.3 percent for non-Hispanic whites, to $46,305, and
by 6.4 percent for Asian Americans, to $53,635.
The Census Bureau report also included these findings:
- There were 6.8 million poor families last year, up from 6.4 million in 2000.
The poverty rate for families rose to 9.2 percent, from a 26-year low of 8.7 percent
- The rate in the South rose to 13.5 percent, from 12.8 percent in 2000. The
South is home to more than 40 percent of all the nation's poor, and it accounted
for more than half of the national increase in the number of poor last year.
- The poverty rate for the suburbs rose to 8.2 percent last year, from 7.8 percent
in 2000. The number of poor people in suburban areas rose by 700,000, to 12 million.
There was virtually no change in the rates in central cities (16.5 percent) and
outside metropolitan areas (14.2 percent).
The bureau said the number of "severely poor" rose to 13.4 million last year,
from 12.6 million in 2000. People are considered to be severely poor if their
family incomes are less than half of the official poverty level.
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