Full Citation

Title: Wisconsin Poverty Report: Progress Against Poverty Stalls in 2016

Citation Type: Miscellaneous

Publication Year: 2018

ISBN:

ISSN:

DOI:

NSFID:

PMCID:

PMID:

Abstract: The Wisconsin Poverty Measure (WPM) poverty rate rose to 10.8 percent in 2016, a significant increase from 2015, despite expanded employment in the state during the period of this report. The official poverty rate in the state also rose significantly in 2016, to 11.8 percent. Market-income poverty, which reflects employment levels and is a gauge of economic health, also rose slightly, even as jobs expanded. Poverty rates rose for children and elders as well. Both the Wisconsin Poverty Measure and official rates for families with children also rose by significant amounts in 2016, as the child poverty rate for the WPM reached 12.0 percent, two points higher than in 2015. Yet, the WPM for children, which takes into account resources from tax credits and noncash benefits as well as earnings, was almost 5 percentage points below the official poverty rate for children of 16.9 percent. Between 2015 and 2016, elderly poverty in Wisconsin as measured by the WPM rose significantly from 7.8 to 9.0 percent. While benefits from the safety net (especially food support and refundable tax credits) played a large role in poverty reduction, changes in the Supplemental Nutrition Assistance Program or SNAP participation (called FoodShare in Wisconsin) reduced these positive effects in 2016 compared to earlier years. Other trends that decreased resources over the past two years include rising childcare and other work-related expenses for families with children, and increasing medical out-of-pocket expenses, especially for the elderly. The Wisconsin Poverty Measure is based on the Federal Supplemental Poverty Measure methodology, and reflects expenditures on food, clothing, shelter, and transportation by lower-income families nationwide, adjusted for cost of living differences between Wisconsin and the nation as a whole. Because expenditures on these staples increased nationally, the poverty line used in the WPM is now $2,200 a year above the official poverty line. This difference also contributed to slightly higher WPM numbers. Although the social safety net provided a buffer against poverty during the recession—and still makes a big difference in countering poverty—the effects are beginning to shrink because of changes in the SNAP program, payroll taxes, medical expenses, and work-related expenses. This has left the WPM poverty rate about the same as in earlier years, showing little or no effect of a slowly expanding Wisconsin economy through 2016. We also examine poverty rates across regions of the state, revealing high poverty rates in Milwaukee County, but with many more substate areas doing much better than the rest of Wisconsin. A full 26 of 72 total Wisconsin counties found their poverty rates below the state average by a significant amount. This pattern suggests an uneven recovery of jobs and incomes across regions within our state, but with poverty rates falling in many areas. Eastern parts of the state, the counties north and west of Milwaukee, and those in the west central region of the state are showing the way, all with poverty rates significantly below 10.8 percent. Poverty rates across subcounty regions show variations that are more dramatic within the largest counties than across the 28 county and multicounty areas in the state. For instance, in Milwaukee County, overall WPM poverty rates ranged from about 8 percent in one southern subcounty area to 38 percent in the central city of Milwaukee in 2016, suggesting a significant segregation of the poor and the rich. The variation in child poverty rates in Milwaukee County was even larger than the variation in the overall WPM rate for the county. Because we believe that the long-term solution to poverty for the able-bodied non-elderly is a secure job that pays well, not an indefinite income support program, these findings are discouraging. New problem areas, such as the rising costs of child care and medical care, are becoming more widespread and offsetting the economic and job recovery in our state. This report also underscores the importance of the safety net that is now doing less in Wisconsin than a few years ago to enhance low earnings for families with children, put food on the table, and encourage self-reliance. Under current conditions, work alone does not solve the poverty problem for adults and families with children.

Url: https://www.irp.wisc.edu/wp/wp-content/uploads/2018/06/WI-PovertyReport2018.pdf

User Submitted?: No

Authors: Smeeding, Timothy; Thornton, Katherine

Publisher: University of Wisconsin- Madison

Data Collections: IPUMS USA

Topics: Poverty and Welfare

Countries: United States