Expert Available: Poverty Numbers are Poor Reflection of America's Struggling Economy

Mizzou expert recommends looking at other factors for better analysis

Aug. 26, 2008

Story Contact:  Emily Smith, (573) 882-3346, SmithEA@missouri.edu

COLUMBIA, Mo. - The U.S. Census Bureau released its "Income, Poverty, Health Insurance Coverage and American Community Survey: 2007 Report" on Tuesday morning, which stated that household incomes are up for the third consecutive year and the poverty rate is not statistically different from 2006. An expert at the University of Missouri thinks these numbers do not represent the current struggling economy.

"These numbers are a reflection of the economic situation in 2007, not 2008; the numbers will be completely different a year from now," said Colleen Heflin, an assistant professor with the Truman School of Public Affairs. "These statistics paint a very rosy picture, but don't capture the struggle Americans are facing while paying the rising costs of goods and services."

The number of Americans living in poverty in 2007 was 37.3 million, or 12.5 percent. Real median household income climbed 1.3 percent to $50,233. The number of people without health insurance coverage declined from 47 million (15.8 percent) in 2006 to 45.7 million (15.3 percent) in 2007.    

"The federal poverty measure is directly tied to income. The report shows that people are receiving increased income, but it does not show where their money is being spent," Heflin said. "People don't have less in their pockets, but they are spending more on gas, food and other things that are more expensive than they were a year ago. The results of the 2007 report make the case that material hardship measures are needed to supplement the report. Currently, there is no nationally represented annual measure to show how people are paying for the full array of necessities to participate in society. This report would show that people aren’t able to afford food for their families or they are getting their heat turned off."

-30-