Overview of Extreme Poverty in Illinois Prepared for the meeting of the Commission on the Elimination of Poverty 10/28/09

Muddy Waters: Definitions of Poverty

Official Federal Poverty Definitions

Extreme or Deep Poverty: living below 50% of the FPL. Low-Income or Near Poor: living between 100% - 200% of the FPL.

Income types included in measure: - Earnings
o r

p e n s i o n

-

Unemployment compensation Social Security Supplemental Security Income Public assistance Veterans’ payments Pension or retirement income Child support
i n c o m e , i n t e r e s t , d i v i d e n d s , r e n t s , r o

r e t i r e m e n t

Noncash benefits (such as food stamps and housing subsidies) do not count.

Shortcomings geography 1. No variation by of Current Measure

2. The level doesn’t keep up with costs of basic needs 3. It doesn’t include non-cash and tax-based benefits 4. It doesn’t account for spending on taxes, work expenses, and health care

The Self-Sufficiency Standard shows what it takes to make Self-Sufficiency Standard for a single ends meet
parent with a preschool and schoolage child in Illinois: - $49,030 annually - $4,087 monthly - $23.22 hourly This is $30,720 higher than the federal poverty line for the same family size.

Self-Sufficiency Wage by Selected Geography 2009
Based on a family with one parent, one preschooler, and one school-age child

What events cause poverty?

Loss of a job: nearly 20% of people enter poverty when the head of household loses a job. Decline in earnings: half of poverty spells begin with the household experiences a decline in earnings. No high school degree: households headed by someone without a h.s. degree are 6.4 times more likely to enter poverty than those with a college degree.

What events cause poverty (cont.)?

Female-headed household: When a twoadult household becomes a female-headed household 20.1% entered poverty. Having children: 8.6% of poverty entries happen when a child is born into a household. Disability: when a head of household becomes disabled, 6.5% of households enter poverty.

What contributes to these events?

Growth in low-wage work: one fourth of the workforce in the United States earns poverty level wages, particularly impacting women and minorities. Discrimination: estimates suggest that discrimination against black men reduces the demand for their labor by at least 10 to 13%. Wage declines for dropouts: high school dropouts earn less money than those with more education and their wages have declined considerably.

What contributes to these events?

Violence: having experienced violence increases employment instability for some women, and leaving an abuser can render a woman without any income. Teen births: half of all non-marital childbearing starts during the teen years which is associated with lower high school graduation and a 20% reduction in the girl’s adult income. Not working full time: this is particularly prevalent for single parents and people with disabilities or parents caring for children with disabilities.

What contributes to these events?

Increased incarceration experience: incarceration reduces wages by 10 to 20% and increases likelihood of unemployment, particularly for black men. High poverty neighborhoods: segregation, discrimination, the decline in jobs, and the loss of positive role models constrain current opportunities and future aspirations for poor minority residents.

Drilling Down: Extreme Poverty

Understandingvery low Exemplified by Extreme incomes: Poverty

family of 3 ≤ $9,355 per year family of 4 ≤ $11,025 per year Severe economic deprivation results in: - hunger and nutritional deficits - substandard housing and homelessness - poor health and untreated illnesses

Extreme Poverty by the 667,026 Numbers Illinoisans live in
extreme poverty. Illinois’ extreme poverty rate rose from 5.1% in 2000 to 5.4% in 2008. During the same time frame the extreme poverty rate held steady nationally.

A disproportionat e share of African Americans live in extreme poverty 4.7%
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Other 34,695 Hispanic 99,385

White (Non
Hispanic)

270,972

Black 261,974

39.5% 18.5% 37.3%
Children 0-17 Other Adult 25-64 1 Young Adult 18-24 Seniors 65+

Children, youth, and young adults comprise 56% of the extreme poverty population

Most in extreme poverty are native born
Area of Origin:

87.1% of people in extreme poverty are native born and 12.9% are foreign born 8.2% of people in extreme poverty live in a linguistically isolated household

Mexico U.S. Territory Central America South America Africa Europe Southeast Asia Middle East

32,771 3,433 3,090 2,094 3,091 14,640 12,660 12,317

Geography of Extreme Poverty in Illinois
County Extreme Poverty Rate Less than 2.5% 2.5 to 4.9% 5.0% or higher

82.7% of Illinoisans in extreme poverty live in metropolitan areas Chicago 419,076
St. Louis, MO-IL Rockford Peoria Champaign-Urbana-Rantoul Bloomington-Normal Davenport, IA-Rock Island-Moline Decatur Springfield Kankakee 30,114 29,662 16,640 15,425 9,503 8,293 8,222 7,860 6,858

Young Adults in Extreme Poverty

123,731 young adults are in extreme poverty 14.6% have at least one child 6,414 have a disability 57.8% are in school 63.3% worked in past year 17.1% are not in school and are not working

 

Disability

16.2% of people in extreme poverty have at least one Children* disability
8.9% 14,569 Learning/ Remembering

Working Age Seniors Adults 20.2% 78,076 Difficulty Working 50.6% 15,709 Physical

Percent with a disability Number with one or more disabilities Top disability

Famili es

extreme poverty are single female-headed households and their children.

extreme poverty are married. married

60,379 people in

A total of 164,485 children live in

31,056 seniors live in extreme poverty 67.2% of them are women 53.1% of them live alone 2,020 head households with children Half have a disability

Seniors

Education levels
12.8% 22.4%

29.8% 35.0%
Less than high school Some college or associates HS diploma or equivalent Bachelors or higher

Work

178,493 people in extreme poverty worked in the past year 1 in 10 worked at least half the year and 11,969 worked

People in extreme poverty are...
          

Much less likely to be married Much less likely to work the entire year Much less likely to work even half the year Much less likely to have a college degree More likely to have a disability More likely to live in linguistically isolated households More likely to not speak English More likely to have an incomplete kitchen or plumbing More likely to live in older housing Much more likely to be a minority Much more likely to not have a vehicle

…than those who are not extremely

poor.

Summary

The majority of those in extreme poverty live in metro areas across the state. 53.7% of people in extreme poverty are children, people with disabilities and seniors – groups not expected to work. 1/3 of those in extreme poverty are single female-headed households and their children. 1 in 10 working age adults in extreme poverty worked at least half the year.

Ripple Effects of Extreme Poverty: Struggling to Meet Basic Needs

78,082 households in extreme poverty do not have a car

Transportation

86.1% of those carless households live in a metro area

11outevery 10 households in extreme poverty of of every 10 households in with incomplete plumbing live in housing extreme poverty lives and/or an incomplete kitchen in housing with incomplete plumbing and/or an incomplete kitchen

24% of all Illinois renters pay over half of their income in rent

Housing

Health

Nearly one-third (31.4%) of people in extreme poverty are uninsured

Half (49.1%) of work age adults are unins

nutrition

9.5% of Illinois households are food insecure 25% of households eligible for Food Stamps are not receiving them Over 900,000 Illinoisans get food from food pantries each year

From 1995-2005 the Safety Protected a smaller share of children from deep poverty than it used to. Net: the safety net lifted 88% of poor - In 1995,
children above 50% FPL. - By 2005, this percentage had declined to 76%.

Protected fewer jobless workers from deep poverty than it used to. Among
very poor unemployed workers looking for work in any given week: - In 1995, the safety net lifted 70% above 50% FPL. - By 2005, this percentage had declined to 60%.

Spotlight on TANFto Needy and Food Temporary Assistance Families Stamps

- In 1995, AFDC (which preceded TANF) lifted 62% of children above 50% FPL. - By 2005 this declined to just 21% for the TANF program. Food Stamps - In 1995, the Food Stamp Program lifted 61% of children above 50% FPL. - By 2005 this figure had dropped to 42%.

Safety Net Supports in Illinois of persons receiving TANF in The number
Illinois has declined precipitously: - In June 2000 262,295 people received TANF - In June 2009 the number had dropped to 67,530. The average annual TANF benefit received per household is $2,982. The average annual SSI benefit received per household is $8,319.

For more information

On Illinois Poverty: www.heartlandalliance.org/povertyrepor t Poverty reports | Local data | Poverty dynamics On Self-Sufficiency in Illinois: www.ilselfsufficiency.org Illinois report | County fact sheets | Online calculator Amy Rynell arynell@heartlandalliance.org 312-870-4943

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