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Poverty rate holds steady

Median income declines

POSTED: September 12, 2012 11:59 p.m.

Median household income in the United States declined by 1.5 percent from 2010 to 2011 to $50,054, but poverty levels barely budged, according to data released by the U.S. Census Bureau on Wednesday.

The income number is some 8.1 percent lower than in 2007, before the recession began.

But the median income for residents of the South, while estimated lower than the rest of the country at $46,899, didn’t trend downward as it did for residents in other regions, according to the data.

Poverty levels in the South also decreased between 2010 and 2011.

The South was the only region where the poverty rate fell between 2010 and 2011, with the number of residents living in poverty falling from 19.1 million to 18.4 million.

And for a region that has consistently been a leader in high poverty rates, the new numbers are a “big deal,” said Michael Leo Owens, associate professor of political science at Emory University.

Owens said a few economic studies show the South as one of the leading regions in job growth and that more people in the region have acquired full-time employment.

But the numbers may not mean the South’s economy is improving by leaps and bounds, Owens said.

One of the questions he posed is whether the new jobs popping up in the South are quality ones; he said studies suggest many are low-paying jobs with low to no benefits.

“All that really means for a good number of folks is that they are just above poverty,” Owens said.

“Just because you have more people who are no longer below the federal poverty level, that doesn’t mean that they’ve suddenly jumped into the middle class but they are probably on the bottom edges of the working class.”

Owens also considers the possible impacts of the “modest exodus of undocumented people” from the South on the region’s poverty level following several anti-illegal-immigration laws being passed in several states, including Georgia, South Carolina and Alabama.

“Maybe we’re seeing some small effect of that as well,” Owens said.

The numbers also showed an increase in income inequality that hasn’t happened since the census started measuring it in 1993.

According to the data, income for the top fifth of American households rose by 1.6 percent from 2010 to 2011, while the other four-fifths lost income.

Income for the nation’s top 5 percent grew by some 4.9 percent, according to the data.

“That’s not so good news,” said Melissa Boteach, the director for the Half in Ten campaign at the Center for American Progress Action Fund.

For most in the country, the median household income declined for the second year in a row, while the poverty rate stayed nearly the same, according to the census.

The fact that, on a national scale, the poverty rate did not drop more last year might be problematic for President Barack Obama in his bid for re-election this year, Owens said.

But Boteach said it could have been worse.

“I think the people were expecting to see a rise in poverty (rates),” Boteach said. “The fact that poverty was steady was a welcome surprise.”

Owens, on the other hand, said the numbers might mean some voters who might normally support Obama might not be engaged for this election.

“Being in a lot of economic distress, the last thing they’re necessarily thinking about is the electoral market,” Owens said. “They’re actually thinking about the supermarket and can they afford groceries.”

The census estimates on income and poverty levels are based on income before taxes and do not include the value of noncash benefits such as Medicaid, public housing and employer-provided fringe benefits.

Had those numbers been included, especially the numbers of people receiving a federal earned income tax credit, Boteach said, it might have mitigated the report’s numbers of people living in poverty.

Still, Owens said those benefits might be a sticking point for the nation’s working poor that could work in favor of Republican candidate Mitt Romney in this election cycle, playing into his characterization that the Obama administration is “giving money to lazy, poor people.”

“If we think that some of these folks who are no longer in poverty, but who are still having a tough time, those folks may have a degree of resentment for those who find themselves below the poverty line,” Owens said.


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