The U.S. Census Bureau recently released data showing that the real median household income in 2022 fell in comparison to the previous year. This news comes as a surprise to many, as the official poverty rate remained relatively unchanged between 2021 and 2022.[0] However, the Supplemental Poverty Measure (SPM) rate, which takes into account additional factors such as tax policies and government programs, increased by 4.6 percentage points from 2021.[1] This marks the first increase in the overall SPM poverty rate since 2010.[0]
In terms of health insurance coverage, the data reveals that 92.1% of the U.S. population had coverage for all or part of 2022, slightly higher than the previous year.[0] However, an estimated 25.9 million people, or 7.9% of the population, did not have health insurance at any point during 2022.[0] While this is a decrease from the previous year, it still highlights the ongoing issue of uninsured individuals in the country.[2]
One of the key factors contributing to the decrease in median household income is inflation. Inflation rose by 7.8% between 2021 and 2022, the largest annual increase since 1981.[0] This rise in inflation canceled out any nominal gains in income, resulting in a 2.3% decrease in real median household income. This is the first time that the Census Bureau has used the Chained Consumer Price Index to adjust income estimates for inflation, highlighting the significant impact of rising costs of living on households.[0]
The regional breakdown of the data shows that median household incomes in the West, Northeast, and Midwest dropped by 3% to 5%, while the South remained unchanged with a median income of approximately $68,000. These regional differences highlight the uneven impact of economic factors across the country.
Another concerning trend revealed by the data is the increase in child poverty. The supplemental measure of child poverty jumped to 12.4% in 2022, more than doubling from the record low in the previous year.[3] This increase can be attributed to changes in federal tax policies, including the expiration of temporary expansions to the Child Tax Credit and the Earned Income Tax Credit, as well as the end of pandemic-era stimulus payments.[0] This is the largest jump in child poverty since the Supplemental Poverty Measure began in 2009.[4]
Social Security continues to be the most important anti-poverty program, lifting 28.9 million people out of poverty in 2022.[1] However, the report also highlights the importance of refundable tax credits, such as the Child Tax Credit and the Earned Income Tax Credit, in providing support to low-income families.[1] These programs, along with food assistance through SNAP and housing subsidies, play a crucial role in helping families facing economic insecurity.[2]
While there are some positive aspects to the data, such as a decrease in the official poverty rate for Black and Asian Americans, it is clear that there are still significant challenges to address. The rise in child poverty and the decrease in median household income underscore the need for policies that prioritize support for low-income families. President Joe Biden has criticized congressional Republicans for not extending the enhanced Child Tax Credit, which he previously touted as a key measure in reducing child poverty.[5]
Overall, the data from the U.S. Census Bureau paints a complex picture of the state of poverty and income in the country. While some indicators show improvement, such as a decrease in the official poverty rate for certain groups, other measures, such as the supplemental poverty rate and child poverty, highlight ongoing challenges.[2] As policymakers and lawmakers consider future legislation and programs, it is crucial to address these disparities and ensure that support reaches those who need it most.
0. “Income, Poverty and Health Insurance Coverage in the United States: 2022” U.S. Census Bureau, 12 Sep. 2023, https://www.census.gov/newsroom/press-releases/2023/income-poverty-health-insurance-coverage.html
1. “US poverty rate jumped in 2022, child poverty more than doubled: Census” WTVD-TV, 13 Sep. 2023, https://abc11.com/us-poverty-rate-jumped-in-2022-child-poverty-more-than-doubled-ce/13774963/
2. “Lapse of Expanded Child Tax Credit Led to Unprecedented Rise in Child Poverty” Just Taxes Blog, 12 Sep. 2023, https://itep.org/lapse-of-expanded-child-tax-credit-led-to-unprecedented-rise-in-child-poverty-2023
3. “Child poverty surges by most on record following expiration of benefits” OCRegister, 12 Sep. 2023, https://www.ocregister.com/2023/09/12/us-child-poverty-surges-by-most-on-record-following-expiration-of-benefits/
4. “Biden's ambitious efforts to strengthen the social safety net are fraying” KAKE, 13 Sep. 2023, https://www.kake.com/story/49639712/bidens-ambitious-efforts-to-strengthen-the-social-safety-net-are-fraying
5. “US household incomes fall for third straight year: Census Bureau” CNA, 12 Sep. 2023, https://www.channelnewsasia.com/business/us-household-incomes-fall-third-straight-year-census-bureau-3765256
