WASHINGTON -- An unprecedented expansion of federal aid has prevented the rise in poverty that experts predicted this year when the coronavirus sent unemployment to the highest level since the Great Depression, two new studies suggest. The assistance could even cause official measures of poverty to fall.The
WASHINGTON — An unprecedented expansion of federal aid has prevented the rise in poverty that experts predicted this year when the coronavirus sent unemployment to the highest level since the Great Depression, two new studies suggest. The assistance could even cause official measures of poverty to fall.
“Right now, the safety net is doing what it’s supposed to do for most families — helping them secure a minimally decent life,” said Zachary Parolin, a member of the Columbia University team forecasting this year’s poverty rate. “Given the magnitude of the employment loss, this is really remarkable.’’
Story continuesIn a separate study, Bruce D. Meyer and Jeehoon Han of the University of Chicago and James X. Sullivan of Notre Dame, analyzing Census Bureau survey data, found that incomes rose among needy Americans in April, despite cresting unemployment, as government payments began. As travel plunged in March, so did her work hours, until the hotel closed and left her with no income.
While few who get the enhanced benefits will fall into poverty, Ganong warned that some jobless workers were ineligible and that bonuses would expire long before the economy recovered. “This is a strong start but only the first chapter of a long story,” he said. One person whose income has grown is Sunshine Lopez, 41, a medical assistant in Spokane who left work on a doctor’s advice because her daughter has a compromised immune system. Workers who quit jobs normally cannot collect jobless benefits, but the coronavirus aid law contains a medical exception.Fearing delays, she was surprised when help quickly arrived — $840 a week after taxes — more than 50% higher than her regular pay.
Migrants in the country illegally face special risks of falling into poverty, and many have American children. The coronavirus relief law bars an entire household from stimulus payments even if a single member lacks legal status. The Migration Policy Institute estimates that prevents 15.4 million people from receiving aid — about 10 million migrants and more than 5 million children and spouses who are legal residents or citizens. Unauthorized migrants are also barred from jobless benefits.
With medium access to benefits, the black and white poverty rates will change little, but the Latino and Asian numbers will rise, partly because of the ban on aid to households with unauthorized immigrants. The projected poverty rates for blacks and Latinos are more than twice as high as those for whites , but without the coronavirus aid law, the disparities would have grown even larger. For Asians, the poverty rate is 14.5%.
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