Poverty rate remains high, Census Bureau finds
(Moneywatch) The best that can be said about the economy in 2012 is, "It didn't get any worse." That's according to a new Census Bureau report which found both median income and the number of people living in poverty essentially unchanged for the second year in a row.
The report underlines how little most Americans have been able to regain from the economic losses caused by the financial crisis five years ago.
About 46.5 million people -- 15 percent -- were in poverty in 2012. That is not statistically different from 2011. It was the sixth straight year that the poverty rate had failed to improve, hurt by persistently high levels of unemployment after the housing bust. The poverty rate last year was 2.5 percent higher than in 2007, the year before the start of the Great Recession.
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The nation's median household income was $51,017 in 2012, about the same as in 2011 (see chart below).
The poverty threshold for a family of four in 2012 was $23,492. More than 6 percent of American households lived on half that much last year.
People 65 and older were the only age group to see an increase in the number of people in poverty, increasing by 300,000 from 2011 to 3.9 million in 2012. Despite this increase the number of people over 65 also increased so the percent of people in that age group in poverty was not statistically different, staying at 9.1 percent.
Like income and poverty, the number of Americans without health insurance stayed roughly the same -- about 48 million people, or 15 percent. The number of people who have insurance grew from 260 million in 2011 to 263 million in 2012.
Despite the lack of change in the statistics, poverty appears to be taking a bigger bite out of the poor. A Gallup survey released last week found 20 percent of Americans reporting they didn't have enough money to buy food in the last 12 months. That's a big increase from earlier in the year and near the recent high of 20.4 percent in late 2008, when the financial crisis was at its peak.
A research paper published earlier this month by Emmanuel Saez, an economist at University of California Berkeley, said the top 10 percent of earners -- those with a household income greater than $114,000 -- collected more than half of the nation's total income in 2012. This is the largest proportion since the government started reporting this in 1917. Even most of that group didn't see much improvement. According to Saez's study, those with the top 1 percent of incomes saw earnings grow 31.4 percent from 2009 to 2012, while the bottom 99 percent saw growth of just 0.4 percent.
