Raising Children Contributes to 43% of American Poverty

Children are expensive—especially if you have a tight budget to begin with.

We know that children make up around 1/3rd of the officially impoverished people in the country. However, this figure necessarily understates the full effect of children on poverty because some adults find themselves in poverty solely because they are taking care of children. That is, if they did not have any children, their incomes would be enough to put themselves over the poverty line. I've been wanting to figure out for some time how many adults this applies to and so I did: 4.7 million.

To arrive at this figure, I went into the CPS ASEC for 2013. To hammer out certain conceptual and technical problems, I then dropped families that were headed by people aged 15-17. This is a small number of families and barely registers in the aggregate figures. With these families dropped, the number of people in poverty shows up like this:

  • Adults in Poverty: 30.6 million.
  • Children in Poverty: 14.4 million.
  • Total: 45 million.

From there, I go through each family and see if their family income would be above the poverty line for a family that was just like theirs but without the children. For example, the income of a family of 2 adults and 2 children was compared against the poverty line for a family of 2 adults and 0 children. The result was this:

  • Adults in Poverty: 25.9 million.
  • Children in Poverty: 0.
  • Total: 25.9 million.

Thus, in total, children account for 14.4 million impoverished people by themselves, but also for 4.7 million adults made impoverished by raising children. These 4.7 million adults constitute 15.4% of all adults in poverty. Together, these impoverished children and adults impoverished by children make up 43% of all poor people in the country.

This 43% figure likely understates the full effect of children on poverty. The calculation assumes families' incomes would be the same even if the families were childless. In reality, many families have lower incomes than they would without children because they have to work less in order to take care of their kids.

The large number of impoverished children and adults impoverished by children is, of course, entirely predictable. Adding children to a family increases the family's income needs, but does not increase its market income and even makes it somewhat harder to work.

Absent robust family welfare benefits, children are always going to create significant poverty risks.