Report: Stimulus checks, expanded UI help 17.2M people avoid poverty in 2020

FEDERAL STIMULUS CHECKS and expanded unemployment insurance during the pandemic together kept 17.2 million people out of poverty in 2020, lowering the supplemental poverty measure below the official poverty rate for the first time in history, according to a new report from the U.S. Census Bureau. / COURTESY U.S. CENSUS BUREAU

PROVIDENCE – Federal stimulus checks and expanded unemployment insurance during the pandemic together kept 17.2 million people out of poverty in 2020, according to a new report from the U.S. Census Bureau.

The Census Bureau on Sept. 14 published a series of reports measuring income and poverty in the U.S. during calendar year 2020. While the official poverty rate was up slightly over the 10.5% in 2019, poverty was actually less prevalent year over year when taking into account tax credits, insurance and other government relief programs, according to the reports.

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The official poverty rate in 2020 was 11.4%, or 37.2 million people, up 1 percentage point, or 3.3 million people, compared with 2019. This reflects declines in median household income and the number of people with full-time earnings, among other factors, but does not reflect stimulus payments and tax credits.

When taking these relief measures into account, a separate marker known as the “supplemental poverty measure” actually dropped year over year. The supplemental poverty measure rate for 2020 was 9.1%, down 2.6 percentage points over 2019. It’s also the first time in the history of the report that the supplemental poverty rate was lower than the official poverty rate, according to the Census.

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Crucial to the decrease in people living below the federal poverty line were federal stimulus checks and expanded unemployment insurance, which helped 11.7 million and 5.5 million people, respectively, avoid or come out of poverty. However, Social Security continues to be the most effective poverty prevention relief program, moving 26.5 million people out of poverty in 2020, according to the report.

Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.

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