New Jersey Poverty in the Wake of the Great Recession 2012

Since the great recession, poverty in new jersey has increased at annual rates not seen in many decades, and shows no signs of abating. Poverty continued to grow in 2010 – reaching the highest level in half a decade.

About 24 percent of the total population was below 200% of poverty in that year, a significant increase from the previous year. The number of people living in poverty crossed the 2 million mark in 2010.

There were more than 2 million 54,000 people living in poverty in that year. Nearly 280,000 additional individuals have been added to the poverty ranks since the beginning of recession in 2007. In 2010, poverty for the white, non-hispanic population stood at 5.8 percent, whereas poverty for black and hispanic new jerseyans was over 19 percent – which is more than 3 times the white, non-hispanic poverty rate.

While all race and ethnic groups experienced an increase in poverty, hispanic residents experienced the highest rise poverty for this group increased from 18.3% in 2009 to 19.9% in 2010.

Historically, poverty among hispanics has been lower than poverty among blacks. In 2009, however, the hispanic poverty rate surpassed the black poverty rate and this trend continued in 2010.

In 2010, the number of hispanics in poverty outnumbered the white, non-hispanics for the first time ever. There were more than 305,000 hispanics below poverty, about 9,800 more than white, non-hispanics in poverty. Especially disturbing, almost one third of all children in new jersey were living in true poverty in 2010- 619,000 in total.

If we look at the number of children living in poverty, we find that hispanic children form the largest group. The number of hispanic children living in poverty exceeded 120,000 in 2010.

The number of black children stood at about 84,000 and white, non-hispanic children around 72,000 in 2010. The number of working age new jersey residents living in poverty rose during the great recession, with more that half a million in poverty in 2010.

The oldest among the elderly (people 75 years or over) had the highest proportion below 200% of poverty in 2010. Those 18-24 followed with 31.3 percent in poverty. And 30.4 percent of children were below 200% of poverty – the third highest poverty rate among all age groups.

Young adults between 18 to 24 years of age experienced a 39.1% increase in the numbers below poverty. – The highest among all age groups. Between 2005 and 2010, the number of people living below 200% of poverty increased by more than 235,000 people.

The number of people in the middle income groups decreased during this period by more than 100,000 people. New jersey’s unemployment rate continues to remain higher than at any time since 1980.

Since the end of the recession it has remained above the 9 percent mark. Resident employment, which declined substantially during the recession, remains well below the level going into the recession and in the 33 months since the end of the recession has hardly risen above the employment level at the end of the recession.

The employment population ratio, which is the percentage of the working population that is working, declined considerably during the recession and remains at a level last experienced about 30 years ago. Likewise the labor force participation rate, which is the percentage of the working population in the labor force, remains stuck at a level not seen since the early 1990s, the consequence of the large increase in discouraged workers who are no longer actively seeking employment.

The underemployment rate provides a broader measure of the extent of unemployment. It includes not only the officially unemployed but also all those working age people who are so discouraged that they have dropped out of the labor force but would take a job if offered one as well as those who are working part-time but would prefer to work full time.

Since the recession the underemployment rate has continued to rise and was 16 percent in 2011, considerably higher than the official unemployment rate. As the recession progressed more and more people have remained out of work for longer time periods.

In 2010, more than half the officially unemployed had been out of work for more than six months. Since the beginning of the recession, the number of households suffering from food insecurity has steadily risen.

The average for 2008-2010 was 12.1 percent, which translates into about 380,000 households in new jersey. Both adult and child food stamp usage has soared since the end of the great recession in june 2009.

More and more people are drawing on this important safety net program to help them meet their basic needs. Food stamp usage is not the domain of any particular racial or ethnic group in new jersey.

In 2010, its usage was more or less evenly divided between the three major racial and ethnic groups. In fact, the increase in food stamp usage has been particularly large among the white and hispanic populations.

Although tanf (temporary aid to needy families) and ga (general assistance) are important safety net programs, increased participation in these programs since the recession has been slight. In fact, participation in the ga program has declined recently as a result of stricter regulations that have been put in place limiting eligibility.

Emergency assistance, a program designed to alleviate homelessness by providing housing assistance to households who are receiving various forms of welfare assistance, has risen steadily since the recession and continued to increase thereafter.

New jersey has the third highest housing costs in the nation, trailing only hawaii and california. In order to afford a 2-bedroom apartment at the fair market rent of $1,302, a household would need an annual income of $52,081, the equivalent of three and a half times the minimum wage in the state.

More than one-half of new jersey renter households paid more than 30 percent of their income in rent in 2010, an amount considered to be excessive. Nearly one third paid more than 50 percent. The middle class in new jersey have increasingly seen their rent and utilities take up a larger proportion of their income since the recession.

A larger percentage of children in new jersey have been receiving health insurance coverage since the recession. In particular, coverage improved for children living in households below 200 percent of the poverty level.

On the other hand, an increasing percentage of adults are without health insurance coverage and, particularly, adults with low incomes living in households below 200 percent of the poverty level.

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