Poverty's New Population
Within the past year, the struggling middle class has given in and applied for everything from food stamps, to energy assistance, to help paying rent.
As a leading economic indicator, there's nothing like a local social services department waiting room to get a read on what's going on before the experts have all the numbers.
For at least the past year, those working on the front lines have noticed something quite troubling: the people coming in for services were beginning to look an awful lot like the people manning the social services offices -- the ones whose job it is to dispense help.
In other words, a whole new population -- a group of people who had been employed and productive, and had been trying to hold out, waiting for the economy to improve -- have within the past year begun to give in and apply for everything from food stamps, to energy assistance, to help paying rent.
According to those studying the phenomenon, this new cohort of applicants appears to be made up of people who've seen reductions in their work hours, had to take lower paying jobs and never would have dreamed they'd have to resort to public assistance to get by. As one county official put it, "The solidly middle class have fallen into the social safety net."
And so it wasn't much of a surprise to those in the human services business when the U.S. Census Bureau announced last month that the poverty rate in the U.S. had hit a 15-year high, increasing from 13.2 percent in 2008 to 14.3 percent in 2009. Percentages, though, don't really tell the story: An astonishing 43.6 million Americans -- that's one in seven -- fell below the poverty level last year. But when one considers that the poverty level is an arguably ridiculously low amount of money -- $21,954 for a family of four -- we know the picture is much grimmer.
To get an idea of just how grim, the Brookings Institution recently released its own analyses of the Census data that paints an especially disturbing picture. According to the Brookings analyses, the hardest hit areas of the country are the suburbs. Again, the numbers are staggering: Since 2000, the percentage of working age poor in the suburbs has increased by more than 37 percent, to almost 14 million people. In all, according to the Brookings analyses, suburbs are now home to nearly one-third of the nation's poor.
The corresponding bad news is that the U.S. is seeing rapidly declining levels of people covered by health insurance. As the poverty level went up, the number of individuals without health insurance went from just over 46 million in 2008 to nearly 51 million in 2009.
Worst of all, experts believe that in spite of signs that the Great Recession is easing, when the 2010 numbers come in they will show that poverty rates and rates of uninsured Americans continued upward.
What the raw numbers indicate is certainly being confirmed on the ground. According to a Brookings analysis of selected nonprofits in the suburbs of Chicago, Los Angeles and Washington, D.C., almost 75 percent of suburban nonprofits reported serving clients who had no previous connection to any safety net program.
More disturbing, almost half of the suburban nonprofits reported losing key revenue sources last year, with one in five reporting that they've had to cut services, and one in seven reporting actively cutting caseloads -- that is, having to refuse help to those who asked for and need it.
Commenting on the Census numbers, Brookings' poverty expert Ron Haskins noted, "[The numbers] are not as bad as people predicted they would be, but they are plenty bad. Child poverty, especially, is up," said Haskins. Haskins also expressed concern about the decrease in health-care coverage. "I think this is a big deal. It will probably continue, which means that the government programs are going to have to pick them up."
The only other vaguely positive note in all this is that if not for existing social safety net services, the Great Recession's impact could have been unfathomably worse. Last year alone, the U.S. spent $132 billion on unemployment insurance, almost $270 billion on Medicaid and $50 billion on food stamps. "So the safety net has really stepped in where the economy left off," says Haskins. "The story would have been much worse if it had not been for the safety net."
But for those serving the new poor, the news is plenty bad, and in no small part for the reasons stated at the top of this column: It isn't just that more people are coming in for help and that resources are being stretched to the breaking point. It is because, as one national expert in human services puts it: "The people coming in for help are starting to look just like the people who are giving it. You can't imagine how traumatizing that can be. They're sitting there thinking, 'Hey, that could easily be me.'"