Poverty is a perennial topic in public policy. In order to make good policy decisions about poverty, we need to understand what poverty is and what it means to the people that experience it.
Since Scioto Analysis is headquartered in Franklin County, I thought it would be valuable to share some information about poverty in a U.S. urban area using Franklin County as a case study. Here are five charts that help contextualize the current state of poverty in Franklin county.
Poverty rate over time
The past decade of poverty trends in Franklin County has been defined by recovery from the Great Recession. The highest reported poverty rate in two decades before the 2008 recession according to the St Louis Federal Reserve was 16.4%, but county poverty rates topped out at nearly 19% in the years after the Great Recession. It took over 10 years for poverty to return to pre-recession levels.
Another takeaway from this chart is that the county did not take the same hit during the COVID-19 recession as it did during the 2008 recession. Part of this was due to temporary assistance issued during the pandemic, which was successful in keeping poverty rates down. Programs like the expanded child tax credit were also crucial in keeping people afloat, but are post-tax income so not included in official poverty measure calculations. This means something more was at work during the COVID recession.
Poverty rates by race
There are significant differences in poverty rates by race in Franklin county. Black and Native American residents of Franklin County are more than twice as likely to be in poverty as white residents. Hispanic/Latino residents are nearly twice as likely to be in poverty as white residents as well. White and Asian residents are the two groups that experience poverty at lower rates than the county as a whole.
Total poverty by race
Despite the fact that white residents experience poverty at the lowest rate of any racial group in Franklin county, the majority of people in poverty in the county are white. This is because white non-hispanics make up 61% of the total population according to the 2020 census.
The difference between absolute poverty statistics and relative poverty statistics demonstrate why it is important to look at all of the context when talking about poverty. They seemingly tell different stories about what poverty is like in Franklin county, but in truth both are needed to understand the complete picture. While white residents of Franklin County tend to be less poor than Black and Hispanic residents, the sheer number of white residents of the county means that most people who are poor in the county are white.
Employment and poverty
Unsurprisingly, people who are employed experience less poverty than those who are unemployed. However, when talking about unemployment, we often overlook the problem of underemployment. The official unemployment rate counts underemployed people as employed, meaning that we sometimes overestimate the strength of the job market when we lean on that measure.
This graph shows the importance of underemployment on poverty. There is a massive gap in the poverty rate between people who worked full time and those who were unemployed, but importantly the part-time/part-year workers experience poverty at a rate much closer to the unemployed group. This demonstrates that not all jobs are equal, and if we want to have some impact on poverty through the labor market we need to make sure that people have enough quality employment.
Education and poverty rates
In Franklin county, there is a strong positive correlation between education and poverty rates. An individual without a high school diploma is almost twice as likely to be in poverty than someone with a high school diploma, and seven times more likely to be in poverty than someone with a bachelor’s degree.
Charts like this suggest potential policy paths for alleviating poverty. Presumably, if we were able to increase the rate at which people finished high school or made equivalents easier to access, we could make more people less likely to experience poverty. We also have insights on how race, employment, and long-term trends impact poverty.