Income and Poverty in 2010: Why Congress Should Pass the American Jobs Act

New data released today on income and poverty in 2010 underscore the need for Congress to pass the President’s American Jobs Act without delay. With the first full year of data following the deepest recession since the Great Depression now in, we see an unacceptably high poverty rate and families struggling to get by on less income.

The pace of job growth has a direct association with poverty and an inverse association with real median family incomes. The increase in adult poverty between 2009 and 2010 was concentrated among persons who did not work at all during the calendar year. Without the safety net provided by unemployment insurance, the increase in poverty would have been greater. According to a Census Bureau analysis, an additional 3.2 million people, including 2.4 million adults and 0.9 million children, would have been poor but for the receipt of unemployment benefits during 2010.

The poverty rate did not rise for those age 65 and older, as Social Security continued to be important in keeping people out of poverty. According to a Census Bureau analysis, an additional 20.3 million people, the largest share age 65 and older, would have been poor but for the receipt of Social Security benefits during 2010.

Median earnings did not change significantly for men or women working year round, full time, which suggests that the overall decline in median family income was driven by people working less than year round, full time and the growing number of people who did not work at all, rather than by lower earnings among those holding jobs.

The economy has added private sector jobs for 18 straight months, for a total of 2.4 million jobs over that period. But the economy must grow faster to replace the jobs lost during the recession.

The President has sent a bill to Congress that puts forth bipartisan measures to immediately put more money in the paychecks of working and middle class families; to make it easier for small businesses to hire workers; to put construction crews to work rebuilding our nation’s schools and infrastructure; and other measures that will help the economy grow while still reducing our deficit and getting our fiscal house in order. These measures are vitally important to reversing the trends we see in last year’s data.

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