Nearly 6 million people in rural America had incomes below the poverty line during the pandemic year of 2020, an increase of 315,000 from the preceding year, according to a Census Bureau estimate released on Tuesday. The annual Income and Poverty report indicated that one in seven rural residents lived in poverty, compared to the national average of one in nine.
The poverty rate nationwide was 11.4 percent, up 1 percentage point from 2019. “This is the first increase in poverty after five consecutive annual declines,” the bureau said.
Fourteen percent of Americans live in rural areas, according to the 2020 census. The Census Bureau classifies “rural” as “all population, housing and territory not included within an urban area.”
The report did not suggest the causes for the increase in poverty rates, but the pandemic was accompanied by an abrupt economic contraction. In April 2020, the unemployment rate peaked at 14.8 percent, the highest since 1948, when government record-keeping began, and economic activity was suppressed for months. Median household income fell 2.9 percent, to $67,521, in 2020. “This is the first statistically significant decline in median household income since 2011,” said the bureau.
As usual, the rural poverty rate was higher than the U.S. average, at 14.1 percent. The increase from 13.3 percent in 2019 was within the margin of error and was not statistically significant.
Just as poverty is higher in rural American than in urban areas, income is perennially lower. Median household income outside of metropolitan areas was $51,616 in 2020, three-fourths of the national figure. The decline of $1,134, or 2.1 percent, from 2019 was within the margin of error.
Pandemic relief programs had a powerful and beneficial effect, according to the bureau’s Supplemental Poverty Measure (SPM), an alternative gauge that weighs the effect of social programs that are not part of calculating the official poverty rate. The SMP rate was 9.1 percent, 2.3 points below the official rate.
“This is the first time in the history of the SPM where poverty is lower using the SPM than the official poverty rate,” said the bureau. Coronavirus stimulus payments lifted 11.7 million people out of poverty. Jobless benefits, expanded during 2020, kept 5.5 million people from falling into poverty. Social Security remained the most important antipoverty program by moving 26.5 million people out of poverty.
“In short: Today’s numbers demonstrate the incredible capability of the U.S. welfare state when it is properly funded and applied,” tweeted Zach Parolin of Center on Poverty and Social Policy at Columbia University. “In a turbulent year, Covid-era income transfers kept food hardship in check and led to a record-low SPM poverty rate. That is a clear success.”
For 2020, the poverty line was $13,465 for an individual and $26,695 for a family of four.
The Poverty and Income in the United States 2020 report is available here.
The Supplemental Poverty Measure report is available here.