../../../MY_DOC%7E1/MY_DOC%7E1/ECONNEWS/South-Western%20College%20Publishing%20-%20Economics  
A Recovery for Some, a Worsening for Others
Subject Number of People Living in Poverty has Increased
Topic Income Distribution and Poverty
Key Words Poverty; Median Income; Minorities
News Story

The Census Bureau reported 34.6 million people living in poverty in 2002, up 1.7 million people from 2001. At the same time, median income fell by $500 to $42,409. The increases in reported poverty were felt most heavily in the Midwest, where total employment has fallen by 2%. African-Americans fared worst among minorities, with median income falling by 3%, and percentage in poverty rising to 24.1%. The poverty rate for single mothers stayed roughly the same at 26.5%, while the number of entire families living below the poverty line increased to 9.6%. Finally, 16.7 % of children were listed as living in poverty.

Poverty levels were also updated to reflect changes in the Consumer Price Index. The cutoff levels for a family of four was $18,392; $14, 348 for a family of three; $11,756 for a family of two; and $9,183 for a single individual.

Democratic candidates for President seized on these statistics as indications that the recent recession was deeper than expected, and has not been as easy to overcome for some as for others. Conservative policy-makers, however, noted that the increases were not as severe after this recession as they have been in past recessions.

(Updated October, 2003)

Questions
1.

Why are some minorities, in particular African-Americans, hardest hit by the recession?

2. Can you think of some reasons why the Midwest would be hardest hit by the increases in poverty?
3. Why do changes in the Consumer Price Index (CPI) matter when we speak about poverty levels? Are the two related somehow, especially among particular groups, such as the elderly?
Source Lynette Clemetson, "Number of People Living in Poverty in U.S. Increases Again." The New York Times. 26 September 2003.

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