Downturn Weighs on Poor

More Children Fall Into Poverty as Family Incomes Shrink; Ms. Smith Sells Her Recliner

Wall Street Journal | 9/29/09 By CONOR DOUGHERTY

Poverty
rose in the West and Midwest last year, as slowdowns in housing and
manufacturing sent more families below the poverty line, according to a
Census Bureau report released Tuesday.

Getty Images

Kimberly
Calvillo prepares food baskets for the needy at Elijah's Pantry in
Chicago on Sept. 10. The group now gives away 500 baskets monthly, up
from 300 in the past year.

The
report, part of the agency's annual American Community Survey, was the
latest to measure the recession's toll on low-income families, after a
boom in which low-skilled workers relied on plentiful jobs and overtime
-- often in construction and retail -- to raise their incomes and
prospects.

The bureau said poverty rates overall increased in 31 states and the
District of Columbia in 2008, compared with poverty-rate increases in
10 states in 2007. Still, of the 31 states that reported increases in
the poverty rate last year, the increases were statistically
significant in only eight, though they included two of the nation's
four largest states, California and Florida.

Florida and California saw poverty-rate increases of about one
percentage point to just over 13% for each state, according to an
analysis of Census data by William H. Frey, a demographer at the
Brookings Institution, a Washington think tank.

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  Sortable Chart: State Poverty on the Rise
  

The
other six states were Oregon, Indiana, Pennsylvania, Michigan, Hawaii
and Connecticut. Only one state -- Michigan -- saw statistically
significant increases in poverty two years in a row.

Tuesday's Census report is the latest to show an increase in poverty
across the U.S. -- especially among children, and in regions where job
and income losses have been acute. Last year, only three states showed
statistically significant decreases in the poverty rate, compared with
12 states in the year-earlier period. Twenty-one states had poverty
rates that were higher than the national poverty rate of 13.2%.

The U.S. poverty rate for 2008 is defined as annual earnings of less than $22,000 for a family of four with two children.

With unemployment rising, and hours shrinking, many working poor and
their children are falling into poverty and seeking more government
help. Families with two or more workers made up 28.4% of food-stamp
recipients, up 1.5 percentage points from a year ago, one of the
largest increases among groups getting food stamps.

"There are lots of people who are using food stamps for the first
time, because they don't have any other options," said Mark Mather, a
demographer at the Population Reference Bureau, a nonprofit research
group in Washington.

The percentage of children living in poverty increased in 26 states
and the District of Columbia last year, compared with the 17 states
that saw increases in 2007.

Johnett
Smith, a 43-year-old home-care nurse, hasn't lost her job, but spotty
work hours have dropped her income to about $800 a month, roughly a
quarter of what she made a year ago. Ms. Smith augments her salary with
partial-unemployment benefits.

Ms. Smith and three of her sons have moved three times in the past
year, including two months spent at a housing shelter. The family is
now living in a two-bedroom attic apartment in Allentown, Pa. Ms.
Smith's 25-year-old son, who is receiving unemployment benefits,
recently moved in as well. "The family has moved back in together to
help each other out," she said.

Ms. Smith said she goes to food banks and plans family meals every
week based on what is in the refrigerator. Everyone in the family has
sold something -- sneakers, clothes and Ms. Smith's recliner -- at the
many yard sales they have staged in the past year to raise cash, she
said. Her 15-year-old son took money from working at a fair to buy
shoes for school -- and gave the rest to his mother to help out, she
said.

"I try to have family meetings to let them know what's going on and how we need to work together," she said.

The increase in poverty in Florida and California was apparent at
the city level. The six metropolitan areas with the largest
year-over-year increase in poverty were in Florida and California,
including Lakeland-Winter Haven, as well as Stockton and Fresno in
California's Central Valley.

Oregon, Nevada and Arizona saw poverty-rate increases between 0.5
percentage point and 0.7 percentage point, according to the Census
Bureau. Poverty also rose across the Rust Belt and industrial Midwest,
with the poverty rising in Pennsylvania, Indiana and Michigan.

The highest concentrations of poor were still in Southern states,
where poverty has long been a problem. The highest poverty rate in the
country, at 21.2%, was in Mississippi, while Kentucky, West Virginia
and Arkansas each had poverty rates around 17%.

Write to Conor Dougherty at conor.dougherty@wsj.com