Oct 16, 2010

Moving Back Home Hides True Poverty Rate

The article answers and earlier question posed on this blog -- AMI (Area Median Income) and poverty rates are masked by overcrowding and moving in with family. The income from all wage earners living under one roof are combined, providing a skewed picture of the Median Income for that household. This is particularly troubling when the # of people supported by that income is not considered or revealed in the statistics.
"For example, last year's poverty rate for the nation's 4.3 million live-in families was 17 percent, based on the incomes of all related adults under a single roof. This means roughly 731,000 of all live-in families were officially classified as poor.

However, the picture is far worse for live-in relatives when their incomes are calculated separately: Their poverty rate then soars to 44 percent, trapping about 1.9 million of those families."