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Citizenship

Household Incomes in the US Have Risen, but Poverty Is Mostly Unchanged


Why Global Citizens Should Care:
The US Census Bureau’s annual report on income and poverty shows slight improvement in both income and poverty levels, but more than 39 million Americans still live in poverty. You can take action here to help tackle poverty at its root causes and support the Global Goals.

The US Census Bureau released its annual report on income and poverty in the United States on Thursday, showing improvement between 2016 and 2017.

Median household incomes rose for the third year in a row, which experts say follows the trend of strong income growth that began in 2015 under President Barack Obama. The median household income in 2017 was $61,372 — just over $1,000 more than in 2016 — and $77,713 for family households.

While the increase in incomes is certainly good news, the report’s findings make clear that major discrepancies in median incomes among people of different racial backgrounds persist. Hispanic households had a median income of approximately $50,000 in 2017, while white and Asian households had median incomes of $68,145 and $81,331, respectively.

Yet, despite a decrease in the poverty rate and a report put out by the Trump administration in July declaring the war on poverty in the US “largely over,” poverty in the US is very much alive.

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The national poverty rate decreased by .4% between 2016 and 2017, but 12.3% of Americans — approximately 39.7 million people — still live in poverty, according to the Census Bureau’s report. This means that, statistically, little significant change has occurred.

This increase in median incomes can likely be attributed to the low unemployment rate. As more people find jobs, the median income, as a mathematical measure, is being driven upward. But on the ground, people — particularly those living on low incomes — are not necessarily getting a pay raise. Experts say that more people are finding employment and working longer hours, but are not receiving better wages.

"We’re continuing to see a shift from part-time to full-time work, so some of that could explain an increase in income," Trudi Renwick, an assistant division chief at Census Bureau, told the Washington Post.

Tax cuts implemented by the Trump administration, mostly benefiting the wealthy, are also a possible factor in the reported increase in household incomes, USA Today reported.

The official poverty rate reflected in the report primarily uses income as a measure of poverty, which experts say makes it a flawed indicator of real poverty in the US. In particular, it does not accurately measure poverty among children because they do not have reported income.

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Instead, the supplemental poverty measure — which accounts for the non-cash support families receive through poverty reduction programs like the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps — is better able to capture poverty among families with children.

The Trump administration has advocated for states increasing work requirements for non-cash welfare assistance programs, including SNAP, which experts say would likely hit the most vulnerable populations the hardest. Among those predicted to be most affected by such policy changes are people who are unable to work more hours — including working mothers and people facing systemic barriers to employments, such as people with disabilities and formerly incarcerated people.