Recession Increases Number of Children Living in Low-Income Families by 7% to 31 Million

Posted August 17, 2011
By the Annie E. Casey Foundation
Newsrelease kidscountdatabook 2011

The last decade has seen a sig­nif­i­cant decline in eco­nom­ic con­di­tions for low income chil­dren and fam­i­lies, accord­ing to the 2011 KIDS COUNT Data Book. The offi­cial child pover­ty rate, which is a con­ser­v­a­tive mea­sure of eco­nom­ic hard­ship, increased 18% between 2000 and 2009, essen­tial­ly return­ing to the same lev­el as the ear­ly 1990s. This increase means that 2.4 mil­lion more chil­dren are liv­ing below the fed­er­al pover­ty line. Data also reveal the impact of the job and fore­clo­sure cri­sis on chil­dren. In 2010, 11% of chil­dren had at least one unem­ployed par­ent and 4% have been affect­ed by fore­clo­sure since 2007.

In 2009, 42% of our nation’s chil­dren, or 31 mil­lion, lived in fam­i­lies with incomes below twice the fed­er­al pover­ty line or $43,512/year for a fam­i­ly of four, a min­i­mum need­ed for most fam­i­lies to make ends meet,” said Lau­ra Speer, asso­ciate direc­tor for Pol­i­cy Reform and Data at the Casey Foun­da­tion. The recent reces­sion has wiped out many of the eco­nom­ic gains for chil­dren that occurred in the late 1990s. Near­ly 8 mil­lion chil­dren lived with at least one par­ent who was active­ly seek­ing employ­ment but was unem­ployed in 2010. This is dou­ble the num­ber in 2007, just three years ear­li­er. The news about the num­ber of chil­dren who were affect­ed by fore­clo­sure in the Unit­ed States is also very trou­bling because these eco­nom­ic chal­lenges great­ly hin­der the well-being of fam­i­lies and the nation.”

The Data Book, which the Foun­da­tion releas­es annu­al­ly, also pro­vides the most cur­rent infor­ma­tion about 10 key mea­sures of child well-being the Foun­da­tion has tracked over the last twen­ty years. Since 2000:

  • Five areas have improved: the infant mor­tal­i­ty rate, child death rate, teen death rate, teen birth rate and the per­cent of teens not in school and not high school graduates.
  • Three areas have wors­ened: the per­cent of babies born low-birth­weight, the child pover­ty rate and the per­cent of chil­dren liv­ing in sin­gle-par­ent families.
  • Two areas are not com­pa­ra­ble: changes made to the Amer­i­can Com­mu­ni­ty Survey’s (ACS) 2008 ques­tion­naire regard­ing employ­ment affect­ed the abil­i­ty to track trends for the per­cent of teens not in school and not work­ing, and the per­cent of chil­dren in fam­i­lies where no par­ent has full-time, year-round employ­ment. Although com­par­isons can­not be made back to 2000, both indi­ca­tors wors­ened between 2008 and 2009.

The Data Book ranks states based on their per­for­mance across the 10 indi­ca­tors of child well-being. New Hamp­shire, Min­neso­ta and Mass­a­chu­setts rank high­est, while Alaba­ma, Louisiana and Mis­sis­sip­pi rank the low­est. The eight states with the biggest improve­ments in their rank­ings between 2000 and the most recent years of data are New York, Mary­land, Con­necti­cut, Mass­a­chu­setts, North Car­oli­na, Ore­gon, Vir­ginia and Wyoming. The five states with the biggest drops in their rank­ings are South Dako­ta, Maine, West Vir­ginia, Hawaii and Montana.

The KIDS COUNT Data Cen­ter pro­vides infor­ma­tion about the 10 key mea­sures tracked in the Data Book in addi­tion to hun­dreds of oth­er indi­ca­tors of child well-being by state, coun­ty city and con­gres­sion­al district.

The research and data tell us that chil­dren who grow up in low-income fam­i­lies are less like­ly to suc­cess­ful­ly nav­i­gate life’s chal­lenges and achieve future suc­cess,” said Patrick T. McCarthy, pres­i­dent and CEO of the Casey Foun­da­tion. To decrease the num­bers of chil­dren who are at risk for bad out­comes as a con­se­quence of eco­nom­ic hard­ship, we must invest in strate­gies that can help chil­dren reach their full poten­tial. In the wake of the reces­sion, the Casey Foun­da­tion urges pol­i­cy­mak­ers to focus on ensur­ing the next gen­er­a­tion of chil­dren is healthy, edu­cat­ed and pre­pared to com­pete in a glob­al economy.”

The 2011 Data Book mes­sage, America’s Chil­dren, America’s Chal­lenge: Pro­mot­ing Oppor­tu­ni­ty for the Next Gen­er­a­tion,” exam­ines how chil­dren and fam­i­lies are far­ing in the wake of the reces­sion and ties togeth­er research find­ings on fam­i­ly eco­nom­ic suc­cess and the crit­i­cal role of invest­ing in ear­ly child­hood pro­grams that can allow the next gen­er­a­tion to suc­ceed. At the core of the mes­sage is the Casey Foundation’s belief that pro­vid­ing the oppor­tu­ni­ty for all chil­dren to suc­ceed requires two-gen­er­a­tion strate­gies that simul­ta­ne­ous­ly help par­ents put their fam­i­lies on a path to eco­nom­ic suc­cess and enhance children’s social, emo­tion­al, cog­ni­tive and phys­i­cal devel­op­ment from birth.

The Casey Foun­da­tion rec­om­mends six strate­gies that can help move low-income fam­i­lies onto the path for prosperity:

  • Strength­en and mod­ern­ize unem­ploy­ment insur­ance (UI) and pro­mote fore­clo­sure pre­ven­tion and reme­di­a­tion efforts: Eco­nom­ic secu­ri­ty is impor­tant through­out a child’s devel­op­ment. A con­tin­ued exten­sion of UI ben­e­fits for the long-term unem­ployed beyond the end of 2011 is rec­om­mend­ed if the unem­ploy­ment rate has not sig­nif­i­cant­ly improved. State leg­is­la­tion could be enact­ed, such as manda­to­ry fore­clo­sure medi­a­tion and per­ma­nent fed­er­al ten­ant pro­tec­tions so that renters who live in prop­er­ties at risk for fore­clo­sure do not lose their lease.
  • Pre­serve and strength­en exist­ing pro­grams that sup­ple­ment pover­ty-lev­el wages, off­set the high cost of child care and pro­vide health insur­ance cov­er­age for par­ents and chil­dren: Valu­able tax cred­its such as the refund­able Earned Income Tax Cred­it should be pre­served, as these cred­its have been effec­tive in lift­ing 6.6 mil­lion Amer­i­cans above the fed­er­al pover­ty line (2001). Low- and mod­er­ate-income fam­i­lies’ access to sub­si­dized child care should be the pri­or­i­ty. While states have done a good job of using Med­ic­aid and the State Children’s Health Insur­ance Pro­gram to pro­vide health insur­ance cov­er­age for par­ents and chil­dren, states should con­tin­ue to devel­op strate­gies to bridge the pay­ment gaps to ensure that this gen­er­a­tion and the next are healthy and strong.
  • Pro­mote sav­ings and asset pro­tec­tion and help fam­i­lies gain finan­cial knowl­edge skills: Hav­ing access to good finan­cial prod­ucts can pro­vide safe mech­a­nisms for sav­ings. Inno­v­a­tive pilot pro­grams, such as deliv­er­ing fed­er­al tax refunds elec­tron­i­cal­ly to pre­paid deb­it cards, rather than being issued by check, can help pre­vent sit­u­a­tions where a check can be quick­ly cashed and spent. Sev­er­al states have adopt­ed leg­is­la­tion to curb high-cost pay­day loans that can trap a fam­i­ly in a cycle of debt.
  • Pro­mote respon­si­ble par­ent­hood and ensure that moth­ers-to-be receive pre­na­tal care: Research has shown that chil­dren do bet­ter when they grow up in an intact two-par­ent fam­i­ly, both in terms of eco­nom­ic well-being and longer term out­comes. Efforts should be encour­aged to find ways to remove dis­in­cen­tives to mar­riage and to sup­port two com­mit­ted, mar­ried par­ents as the best envi­ron­ment to raise chil­dren. The health of infants and young chil­dren is close­ly tied to the health of their moth­ers dur­ing preg­nan­cy. Expand­ed access to pre­na­tal care could be giv­en to more preg­nant women if states raised the eli­gi­bil­i­ty stan­dard for pub­lic health insurance.
  • Ensure that chil­dren are devel­op­men­tal­ly ready to suc­ceed in school: Home vis­it­ing and oth­er par­ent­ing sup­port pro­grams can help par­ents under­stand the crit­i­cal role they play in their child’s ear­ly devel­op­ment. The tough eco­nom­ic cli­mate has placed some ear­ly child­hood pro­grams at risk — Head Start and Ear­ly Head Start — as fed­er­al funds dry up and states face large deficits. As state economies recov­er, pol­i­cy­mak­ers should con­tin­ue to sup­port these pro­grams and improve their quality.
  • Pro­mote read­ing pro­fi­cien­cy by the end of third grade: Reach­ing the mile­stone of read­ing on grade lev­el by the end of third grade is crit­i­cal to ensure that the next gen­er­a­tion of stu­dents can com­pete glob­al­ly. Deep­er con­nec­tions between the ear­ly child­hood and K‑12 sys­tems and ensur­ing more con­sis­tent stan­dards across states can bet­ter serve chil­dren and result in increased stu­dent achievement.

There is a great deal of knowl­edge about how to help strug­gling fam­i­lies get back on track and increase their children’s chances for suc­cess while build­ing a vibrant econ­o­my,” con­clud­ed McCarthy. In the years fol­low­ing World War II, we made great progress in child well-being and reduced many of the dis­par­i­ties asso­ci­at­ed with the dif­fer­ences in income and wealth, and race and eth­nic­i­ty. Our chal­lenge now is to find the will to make sound invest­ments that can improve the eco­nom­ic prospects for fam­i­lies today while prepar­ing our chil­dren for the future.”

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