Poverty 101: The State of Poverty in the U. S Poverty 101: The State of Poverty in the U.S., Texas, and Local Communities January 31, 2007 Frances Deviney, Ph.D., Texas KIDS COUNT Director Center for Public Policy Priorities

Family Economic Security Unemployment is Down 5.3% in 2005 Median Income is Up $45,000 (Families w/ children in 2005) Unemployment: -- Long decline from 1992 to 2000 -- Rose in early 2000s; Peaked in 2003 at 6.8% -- Looks like it will be lower for 2006, but annual #s not available yet from TWC Median income stagnant from 2000-2004 around $44,200 ($44,900 in 2002; $43,600 in 2003) -- US median income in 2005 $53,000 The CPI has grown around 2-3% each year since 1996 (1.6% in 1998 & 2002) http://data.bls.gov/PDQ/servlet/SurveyOutputServlet?request_action=wh&graph_name=CU_cpibrief Sources: Texas Workforce Commission; American Community Survey, U.S. Census Bureau

Source: American Community Survey & Census, U.S. Census Bureau Total Poverty 3.9 Million Texans live in poverty Poverty is on the rise in Texas . . . Source: American Community Survey & Census, U.S. Census Bureau

Source: Small Area Income and Poverty Estimates, U.S. Census Bureau Child Poverty Most notably among children. 1.5 Million Texas Children in poverty in 2005. Nearly one in 3 children lives below the age of five live in poverty. One in ten children lives in extreme poverty (family income below 50% FPL) Source: Small Area Income and Poverty Estimates, U.S. Census Bureau

What is Poverty? Originally designed to reflect the minimum amount of income that American households need to subsist. Poverty = 3 x cost of food per family size Circa 1960s Updated annually for inflation, not for families’ changing expenses The U.S. Census Bureau establishes annual income thresholds to measure poverty and estimate the number of poor people. People in families with income below the federal poverty threshold are considered poor. The U.S. Department of Health and Human Services uses these thresholds to set income guidelines, which vary by family size and are referred to as the “federal poverty level” (FPL). FPL is used to determine eligibility for many government programs. Private organizations also use these guidelines to determine eligibility for their services to low-income families.

2007 Official Federal Poverty Guidelines Family of 2 < $13,690/year Family of 3 < $17,170/year Family of 4 < $20,650/year Assumed food = 1/3 of household expenses – ONLY expense considered. Doesn’t reflect higher cost of housing or new expenses such as child care and higher proportion of health care costs. Also, baring Alaska & Hawaii, geography is not considered. Antiquated standard that no longer captures true economic need.

Living in Austin: Family Security Index Single-Parent One Child Single-Parent Two Children Two Parents One Child Two Parents Two Children Necessary Annual Income $38,497 $41,810 $46,752 $50,137 % Federal Poverty Line 280% 244% 272% 243% 2001 FSI data adjusted to 2006 dollars using the CPI inflation calculator and compared to 2007 FPL. Source: Family Security Index, Center for Public Policy Priorities; Data Adjusted for 2006 Inflation Levels

Who Lives in Poverty in TX? Non-Anglo populations more likely to live in poverty Hispanic 26% African-American 23% Asian 12% Anglo 7.5% Adults 65 and older = 12.7% U.S. = 9.9% Sources: Current Population Survey 2005 to 2006 Supplements & 2005 American Community Survey, U.S. Census Bureau

Who Lives in Poverty in TX? One in 10 families 5th highest rate in the nation Even higher for minority families (1:6) 70% of poor families have a parent that works Of those: 56% have parent that dropped out 69% have parents without health insurance “Worker headed” = If either head of household or spouse worked at some point during the year. On average, these families worked 43 weeks per year. Dropout % is 2nd highest in nation (WPFP) Health Insurance % is highest in nation Sources: 2004 Working Poor Families Project

Children across the country are not affected equally by economic hardship, and conditions along the Texas-Mexico border are particularly severe. In some border counties, almost half of all children live in poverty. Cameron and Hidalgo Counties in South Texas had the highest rates of poverty in the nation in 2005 at about 41% (2005 ACS).

Outcomes for People in Poverty Worse health status Greater propensity to engage in risky behaviors Criminal activities Risky sexual behaviors Smoking Drinking Greater exposure to environmental hazards Source: Government Accountability Office, U.S. Federal Government

Outcomes for People Living Under 200% of Poverty 6 times more likely to not have enough food 5 times as likely to miss meals 11 times more likely to be evicted 50% more likely to skip necessary medical care 7 times as likely to have utilities disconnected 3 times as likely to have telephone disconnected Source: Economic Policy Institute, 2001

Outcomes for Children in Poverty Children in poverty are less likely to: Children in poverty are more likely to: 55% of Texas public high school students are considered economically disadvantaged (TEA) Children in poverty are less likely to: receive prenatal care pass state education exams (i.e., TAKS) graduate from high school Children in poverty are more likely to: be born at low birthweight need food assistance live in poverty as adults

16.4% of Texans are food insecure (highest in US) Hungry Children are: Absent from school more often Score lower on standardized tests Generally in worse health 16.4% of Texans are food insecure (highest in US) Texas was one of only 7 states where rates of both food insecurity and hunger exceeded the national average.

What Can We Do? Support federal and state policies that promote financial security and health of families by: Increasing minimum wage Removing full-family sanction from TANF Increasing access to child care subsidies Reducing number of uninsured children Increasing number of children on food stamps Since the full-family sanction was instituted in 2003, tens of thousands of children have lost assistance. --As of 2004, only 213,000 Texas children received cash assistance --63,000 children dropped from 2003 to 2004 --Down from over 550,000 in the mid-1990s --Nearly 123,000 children receiving subsidized child care (5.2% of 0-12 population) --But 36,000 on waiting lists --Half of uninsured children eligible for CHIP or medicaid. --Half of eligible children not receiving food stamps.

Healthy Children Come from Healthy Families We must remember that data on children should always be examined within the context of the family. Families are critical for healthy child development. Family characteristics such as parental mental health, shared parent-child activity, parental monitoring, and parental warmth and supportiveness are associated with positive child outcomes.

Texas KIDS COUNT Project

Presenter Contact Information Frances Deviney, Ph.D. Texas KIDS COUNT Director & Senior Research Associate 512/320-0222, ext. 106 deviney@cppp.org

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