Full Citation
Title: 2021 Poverty Projections: Assessing Four American Rescue Plan Policies
Citation Type: Miscellaneous
Publication Year: 2021
ISBN:
ISSN:
DOI:
NSFID:
PMCID:
PMID:
Abstract: Key elements of the American Rescue Plan Act would reduce the projected poverty rate for 2021 by more than one-third. In an earlier analysis, we projected that without this legislation or other new supports, but with the relief policies passed in December, the 2021 annual poverty rate would be 13.7 percent. We project that four elements of the American Rescue Plan would reduce that annual poverty rate to 8.7 percent. 1 Other key findings regarding the American Rescue Plan are as follows: The legislation would reduce the projected number of people in poverty in 2021 by about 16 million, from over 44 million to 28 million. The projected 2021 poverty rate for children would be cut by more than half. We project that the poverty rate for individuals in households that experienced a job loss because of the pandemic recession would decline by more than half, while the poverty rate for households that did not experience job loss would decline by almost one-third. Poverty would fall 42 percent for Black, non-Hispanic people and 39 percent for Hispanic people compared with 34 percent for white, non-Hispanic people, thus reducing the disparities in poverty rates for Black, non-Hispanic people and Hispanic people relative to white, non-Hispanic people. The combined policies would reduce the share of people experiencing deep poverty (i.e., those with resources of less than half of the poverty threshold) by one-third. The share of the population with low family income (i.e., income below twice the poverty threshold) would fall from 45 to 38 percent. Our estimates include the effects of the American Rescue Plan Act's (1) extension of pandemic-related unemployment insurance benefits, (2) extension of higher Supplemental Nutrition Assistance Program benefits, (3) $1,400 recovery rebate payments, and (4) advance portion of the increased child tax credit. We assess the impacts of these provisions on families’ economic well-being using the Supplemental Poverty Measure.
User Submitted?: No
Authors: Wheaton, Laura; Minton, Sarah; Giannarelli, Linda; Dwyer, Kelly
Publisher: Income and Benefits Policy Center
Data Collections: IPUMS USA
Topics: Poverty and Welfare
Countries: