The Effect of the COVID-19 Pandemic on Income and Poverty
The COVID-19 pandemic has taken a significant toll on the U.S. labor market. In the three months from mid-March through mid-June more than 50 million claims for unemployment insurance were filed, and the employment rate fell by 14 percent in April — the largest one-month decline on record. At the same time, the federal government initiated an unprecedented response that committed more than $3 trillion to countering the effects of the pandemic. Our recent study shows that this response helped lift incomes and prevent millions of families from falling into poverty. As the pandemic persists, however, policymakers must determine the extent to which further federal relief is warranted. This dashboard reports income and poverty estimates for the U.S., updated on a monthly basis to inform these decisions on a near-real-time basis.
Understanding Progress in the Fight against Poverty
Many well-known and well-documented flaws with the U.S.’s official poverty measure, including a narrow, error-ridden measure of resources and a biased adjustment for inflation, make it a poor indicator of changes in material deprivation over time. The official poverty measure suggests that the poverty rate is the same today as it was 40 years ago. In reality, poverty has declined significantly over this period, but this progress is rarely recognized. Our poverty dashboard shows how simple corrections of the well-known flaws in the official poverty measure result in a very different story about how poverty has changed over time during the period between 1960 and 2017. For more details on how we measure consumption poverty and our latest results see our new Annual Report on U.S. Consumption Poverty: 2018.