Employment and Poverty Among the Homeless - Who Are The Poor?

Based on the Official Poverty Rate

An official count of the poor includes all those whose family incomes fall below the poverty threshold figure for that particular size family, as seen in Table 3.1. In 2003, based on those criteria, there were 35.9 million poor in the United States, 12.5% of the population. (See Table 3.2.) Children were poor at a higher rate (17.6%) than were adults aged eighteen to sixty-four (10.8%) or aged sixty-five and older (10.2%).

In 2003 whites had the lowest rate of poverty (10.6%), while African-Americans had the highest rate (24.4%). (See Table 3.2.) People of Hispanic origin also had high poverty rates; more than one in five (22.5%) lived below the poverty threshold. Asian people had a poverty rate slightly below the national rate (11.8%).

In 2003, 7.6 million families, or one in ten of all families, were poor. (See Table 3.2.) Only one in twenty married couple families were below the poverty threshold (5.4%). Male-headed, single-parent families had a rate of poverty of 13.5%, less than half that experienced by female-headed, single-parent families (28%). In other TABLE 3.2
People and families in poverty, by selected characteristics, 2002 and 2003
[Numbers in thousands, people as of March of the following year]
SOURCE: Adapted from Carmen DeNavas-Walt, Bernadette D. Proctor, and Robert J. Mills, "Table 3. People and Families in Poverty by Selected Characteristics: 2002 and 2003," in Income, Poverty, and Health Insurance Coverage in the U.S.: 2003, U.S. Census Bureau, Current Population Reports, P60-226, August 2004, http://www.census.gov/prod/2004pubs/p60-226.pdf (accessed February 18, 2005)

words, more than one in four female-headed, single-parent families lived below the poverty threshold in 2003.

Based on Alternate Poverty Measures

The size of the poverty-stricken segment of the U.S. population varies depending on which method of determining the poverty threshold is used to identify the poor population. The U.S. Census Bureau has experimented with ways to measure the numbers of people and families categorized as poor. The experimental methods differ from the official methods in two primary ways. First, they take into account out-of-pocket medical expenses. Second, they make adjustments for different housing costs based on geography, by region and/or metropolitan versus rural residences.

In 2001 the Census Bureau used both official and experimental methods to calculate poverty rates in response to the 1995 National Academy of Sciences recommendations. Figure 3.1 presents poverty rates by age group as calculated by different methods. The official rate of poverty for children under eighteen was higher than the rates produced using experimental methods. Nonetheless, all methods for determining poverty showed a higher rate of poverty for children than for adults aged eighteen to sixty-four years.

The rates for senior citizens showed the most variation between the experimental and official methods for measuring poverty. (See Figure 3.1.) The experimental methods used to study poverty rates make adjustments for medical out-of-pocket expenditures and because the elderly have high out-of-pocket medical expenses, methodologies that adjusted income accordingly resulted in much higher numbers of elderly falling into the ranks of the poor.

Trends in the Poverty Rate

For the most part, the poverty rate is linked to the performance of the U.S. economy. At times when the economy is in recession, the poverty rate increases. In fact, the poverty rate often begins to increase somewhat before a serious economic downturn, and may not begin to decline until some time after a recession ends.

Figure 3.2 demonstrates that during the recession of 1980-82, when many Americans lost their jobs and the economy performed poorly, the poverty rate increased dramatically. In 1979, the year before the recession began, the poverty rate was 11.7%; by 1983 it stood at 15.2%. After the recession of the early 1980s ended, the poverty rate gradually declined. By 1989 it was down to 12.8%, its lowest level since 1979. The United States then endured another recession in 1990-91, and by its end the poverty level was up to 14.2%. While the recession that began in March 2001 ended the following year, the poverty rate and the number of individuals living in poverty continued to rise into 2003.

Poverty Rates by Category

FAMILIES.

The Census Bureau's 2004 report on poverty data included poverty rates by family structure. (See Table 3.2.) The recession that started in March 2001 was reflected in rising numbers of people living in poverty across all categories of family structure. The rate of poverty for all families in 2000 was 8.7%; by 2002 it had risen to 10.4% and by 2003 to 10.8%. (For 2000 poverty data, see "Table 1. People and Families in Poverty by Selected Characteristics: 2000 and 2001," in Bernadette D. Proctor and Joseph Dalaker, Poverty in the United States: Current Population Reports, P60-219, U.S. Census Bureau, September 2002.) The poverty rate for married couple families in 2000 was 4.7%; by 2002 it had risen to 5.3% and by 2003 to 5.4%. Households headed by single females had a poverty rate of 25.4% of 2000; in 2002, the rate had risen to 26.5% and by 2003, to 28%. The poverty rate of households headed by single males rose from 11.3% in 2000 to 12.1% in 2002 and 13.5% in 2003.

CHILDREN.

Almost thirteen million children are in poverty. In 2003 a higher proportion of children lived in poverty (17.6%) than any other age group. (See Figure 3.3.) Over one-third (35.9%) of the people living in poverty were children even though they made up only one-quarter (25.4%) of the population (Carmen DeNavas-Walt et al., Income, Poverty, and Health Insurance Coverage in the United States: 2003, U.S. Census Bureau, August 2004).

According to DeNavas-Walt et al., over half (52.9%) of children under six years of age and living in a female-headed, single-parent family lived in poverty. These young children were at particularly high risk of poverty compared to their peers who lived in two-parent households. The poverty rate for children under the age of six living in married-couple households was 9.6%. Overall, children under the age of eighteen who lived in single-parent households were over five times more likely to live in poverty than were children living in married-couple households.

Over the past few decades the child poverty rate has fallen, from a high of 27.3% in 1959 to 17.6% in 2003. (See Figure 3.3.) The decline in poverty for children was not steady but mirrored the fluctuations seen in the poverty rate of adults aged eighteen to sixty-four. The age group that had the most improvement in poverty rates was senior citizens; their rate in 1959 was 35.2% and in 2003 it was 10.2%.

RACE AND ETHNICITY.

In 2003 Hispanics and African-Americans were much more likely to be poor than whites. Members of these two populations also had higher rates of FIGURE 3.1
Official and experimental poverty rates by age, 2001
SOURCE: Bernadette D. Proctor and Joseph Dalaker, "Figure 7. Experimental Poverty Rates by Age: 2001," in Poverty in the United States: 2001, U.S. Census Bureau, Current Population Reports, P60-219, September 2002, http://www.census.gov/prod/2002pubs/p60-219.pdf(accessed February 28, 2005) single female-headed households and lower rates of high school graduation, two indicators of increased likelihood of poverty. (See Figure 3.4.) In 2003 the poverty rate for Hispanics (who may be of any race) was 22.5%; 18% of Hispanic families were headed by a single mother, and 43% of the Hispanic population aged twenty-five and older had not graduated from high school. The poverty rate for African-Americans was 24.3%; 32.4% of black families were headed by a single mother, and one in five African-Americans aged twenty-five and older had not graduated from high school. Non-Hispanic whites and Asian Americans (as reported by DeNavas-Walt et al.) had the lowest rates of poverty by racial group (8.2% and 11.8%, respectively). Only 8.8% of white families were headed by a single mother, and only 10.6% of the white population aged twenty-five and older had not graduated from high school.

FIGURE 3.2
Number in poverty and poverty rate, 1959-2003
SOURCE: Carmen DeNavas-Walt, Bernadette D. Proctor, and Robert J. Mills, "Figure 3. Number in Poverty and Poverty Rate, 1959 to 2003," in Income, Poverty, and Health Insurance Coverage in the U.S.: 2003, U.S. Census Bureau, Current Population Reports, P60-226, August 2004, http://www.census.gov/prod/2004pubs/p60-226.pdf (accessed February 18, 2005)

FIGURE 3.3
Poverty rates by age, 1959-2003
SOURCE: Carmen DeNavas-Walt, Bernadette D. Proctor, and Robert J. Mills, "Figure 4. Poverty Rates by Age: 1959 to 2003," in Income, Poverty, and Health Insurance Coverage in the U.S.: 2003, U.S. Census Bureau, Current Population Reports, P60-226, August 2004, http://www.census.gov/prod/2004pubs/p60-226.pdf (accessed February 18, 2005)

FIGURE 3.4
Family poverty rates and selected indicators, 2003
SOURCE: Created by Melissa Doak for Information Plus from "Table A-2. Percent of People 25 Years and Over Who Have Completed High School or College, by Race, Hispanic Origin and Sex: Selected Years 1940 to 2003," U.S. Census Bureau, June 29, 2004, http://www.census.gov/population/socdemo/education/tabA-2.pdf (accessed February 18, 2005); Jason Fields, "Table 4. Single Parents by Sex and Selected Characteristics: 2003," in America's Families and Living Arrangements: 2003, Current Population Reports, P20-553, U.S. Census Bureau, November 2004, http://www.census.gov/prod/2004pubs/p20-553.pdf (accessed February 28, 2005); and Carmen DeNavas-Walt, Bernadette D. Proctor, and Robert J. Mills, "Table 3. People and Families in Poverty by Selected Characteristics: 2002 and 2003," in Income, Poverty, and Health Insurance Coverage in the U.S.: 2003, U.S. Census Bureau, Current Population Reports, P60-226, August 2004, http://www.census.gov/prod/2004pubs/p60-226.pdf (accessed February 18, 2005)

WORKING STATUS.

The poor are often assumed to be the unemployed. People who are unemployed are more likely to be poor but many people who work can be poor as well. People who worked full-time at any point during 2003 had a 2.6% poverty rate. People who worked part-time at any point during 2003 had a 12.2% poverty rate. Those who did not work at all during 2003 had a 21.5% poverty rate. (See Table 3.2.)

Region

Poverty rates vary from one part of the United States to another. All regions saw an increase in poverty rates between 2002 and 2003. (See Table 3.2.) The South had the highest rate of poverty in 2003, 14.1%, up from a rate of 13.8% in 2002. DeNavas-Walt et al. pointed out that four out of ten (40.6%) poor people lived in the South in 2003, while only 35.9% of Americans lived there. The poverty rate increased in the other regions as well. In the Northeast, the poverty rate increased from 10.9% in 2002 to 11.3% in 2003. In the Midwest, the rate increased from 10.3% in 2002 to 10.7% in 2003. In the West, the rate increased from 12.4% in 2002 to 12.6% in 2003.

Poverty rates also vary by residential area. Inner cities tend to have the highest rates. In 2003 the poverty rate for people living in central cities was 17.5%, up from 16.7% the year before. Rural areas also have a high poverty rate; in 2003 nonmetropolitan areas had a poverty rate of 14.2%, unchanged from the previous year. Suburban poverty rates tend to be the lowest, but even there the rates were rising in the early 2000s; in 2003 the poverty rate in the suburbs was 9.1%, up from 8.9% the year before.