urban institute nonprofit social and economic policy research

Consequences of Poverty



Homelessness, poor health, hunger—poverty’s consequences can be severe. Growing up in poverty can harm children’s well-being and development and limit their opportunities and academic success. And poverty imposes huge costs on society through lost productivity and higher spending on health care and incarceration.


What Happens to Families' Income and Poverty after Unemployment?


This study examines family incomes after job loss. We find that 45 percent of parents that experienced unemployment lasting at least two months remained unemployed for more than 6 months. Despite the fact that many of these families qualified for safety net benefits, their poverty rate increased from 12 to 35 percent. In contrast, families with parents experiencing unemployment for shorter periods did not experience big jumps in poverty. The results highlight the critical role of policies that spur quick reemployment in maintaining family economic well-being.
Publication Date: May 31, 2012

How Employment Constraints Affect Low-Income Working Parents' Child Care Decisions


A multiyear qualitative study finds low-income families seeking dependable child care are hampered by unsteady work, fluctuating wages, and unreliable transportation. Given many low-wage workers' difficulties finding jobs, especially in the Great Recession, parents selected child care arrangements within constraints imposed by employers rather than what they felt optimal for their children's development. Policy changes could bridge the gap between working parents and professional child care centers. For example, increasing public funding for Head Start, Early Head Start, and child care subsidies would encourage child care providers to extend hours, which would better accommodate more families' work schedules.
Publication Date: February 01, 2012

How Contextual Constraints Affect Low-Income Working Parents' Child Care Choices


A multiyear qualitative study describes how low-income parents view their supply of child care, how they learn about their options, and barriers to access. Common impediments include nonstandard schedules, inflexible employers, and unreliable transportation. Challenges are even more intense for immigrants, parents lacking English proficiency, and parents of infants and of children with special needs. Head Start can't enroll enough children to meet demand, and though many families qualify for child care assistance, CCDF spending is capped. Enhancing investment in these resources would help low-income working families get the higher quality and more stable care children need.
Publication Date: February 01, 2012

Savings and Hardship Avoidance Among Households Headed by People with Disabilities: Implications for SSI


For households headed by persons with disabilities, savings can provide near-term protection against hardship. Analysis of longitudinal data from the 2001 panel of the Survey of Income and Program Participation indicates that households with $2,000 or more in liquid assets (interest-earning assets held at financial institutions) are better able to avoid subsequent hardships such as forgone doctor visits and missed utility payments, compared to those with smaller (or no) asset holdings. This evidence has implications for possible increases in the resource limits for the Supplemental Security Income (SSI) program, now $2,000 for individuals and $3,000 for couples.
Publication Date: May 18, 2011

Penny Wise, Pound Foolish: Why Fighting Child Poverty in the Great Recession Makes Sense


Child poverty generates serious long-term economic costs not only for those children (when they become adults), but for the U.S. economy as a whole. This paper argues that these long-term costs will rise because of the Great Recession, as child poverty rises substantially and remains elevated for years to come. Children growing in newly poor families, and/or those whose parents suffer permanent job loss, will likely have worse educational and employment outcomes. Those young people who enter the labor market during this period will suffer reduced earnings as well. This will impose fiscal as well as economic costs on the U.S. in the future. Investments to reduce child poverty in both the short and long-terms thus make economic sense for the U.S., despite the nation’s ongoing fiscal crisis.
Publication Date: September 16, 2010

Smallest Victims of the Foreclosure Crisis: Children in the District of Columbia


As foreclosures have been sweeping the nation in the past few years, the effect of the crisis on children tends to be overlooked. In this brief, the first of two, we discuss foreclosure trends as they relate to public school students living in Washington, D.C. between 2003 and 2008. In particular, we describe the demographic makeup of the students affected, the type of housing and neighborhoods in which they live, and the schools they attend. We conclude with recommendations for both the housing and education sectors in mitigating this crisis as the number of foreclosures continues to rise.
Publication Date: August 31, 2010

Childhood Poverty Persistence: Facts and Consequences


The U.S. child poverty rate has fluctuated between 15 and 23 percent for the past four decades, but far more children—37 percent—live in poverty at some point during their childhoods. Being poor at birth strongly predicts future poverty status. Using the PSID, this study finds that 49 percent of children who are poor at birth go on to spend at least half their childhoods living in poverty. In addition, children who are born into poverty and spend multiple years living in poor families have worse adult outcomes than their counterparts in higher-income families.
Publication Date: June 30, 2010

Ameliorating the Plight of Homeless Veterans:
Testimony before the Committee on Veterans' Affairs United States House of Representatives


Testimony from Mary Cunningham on H.R. 3073 for the United States House of Representatives, the Committee on Veterans’ Affairs. H.R. 3073 would create a homelessness prevention program for low-income veterans.
Publication Date: October 13, 2009

Targeting Chronically Homeless Veterans with HUD-VASH


Hundreds of veterans are sleeping on the street or in the emergency shelter system in the District of Columbia. This brief examines data from the vulnerability index survey, completed by the DC Department of Health and Human Services and Common Ground, a nonprofit supportive housing provider. These data indicate that homeless veterans in DC have numerous health problems, leaving them highly vulnerable to premature mortality. The DC Veteran Affairs Medical Center should prioritize these highly vulnerable homeless veterans for HUD-VASH vouchers, which link housing subsidies with supportive services.
Publication Date: August 01, 2009

Five Questions: Mary Cunningham on how to combat homelessness


Mary Cunningham, author of "Preventing and Ending Homelessness—Next Steps," answers five questions about how to combat homelessness. Evidence-based approaches have cut homelessness among chronically homeless single adults and new strategies are now being adopted to help homeless families. Investing in proven strategies is crucial as the economic crisis puts more people at risk of ending up in shelters and threatens to reverse the progress communities have made toward ending and preventing homelessness.
Publication Date: April 22, 2009

Preventing and Ending Homelessness—Next Steps


Across the country, communities are working to end homelessness by investing in Housing First approaches that help families and single adults get back into permanent housing. Until recently, many of these communities were reducing homelessness. Today, the housing crisis and economic recession threatens progress and puts millions of Americans at risk of homelessness. Many expect the homeless numbers to swell—and some communities are already reporting sharp increases, particularly among families. This brief examines the current state of homelessness, how community responses are changing, what is working, and, most important, what policymakers should be doing to move forward, not backward.
Publication Date: February 01, 2009

Impact of Rising Gas Prices on Below-Poverty Commuters


While the increase in gas prices has increased costs for all commuters, workers from households whose income is below the federal poverty level pay a larger proportion of their income for gas. This fact sheet uses data from the 2006 American Community Survey to quantify the relative burden of gas use for commuting.
Publication Date: September 01, 2008

The Economic Costs of Child Poverty: Testimony Before the U.S. House Committee on Ways and Means


In testimony before the U.S. House Ways and Means Committee, visiting fellow Harry Holzer says the costs to the United States associated with childhood poverty total about $500 billion per year, or the equivalent of nearly 4 percent of GDP. This suggests that investing significant resources in poverty reduction might be more cost-effective than previously thought.
Publication Date: January 24, 2007

Five Questions: Austin Nichols on child poverty rates


Austin Nichols of the Urban Institute's Income and Benefits Policy Center delves into child poverty, social insurance, taxes, retirement, and family structure. His most recent paper, "Understanding Changes in Child Poverty Over the Past Decade," explores reasons behind two sharp changes in child poverty.
Publication Date: June 7, 2006

Poverty and Student Achievement: A Hopeful Review


This chapter focuses on the relationship between poverty and factors associated with poverty and student academic achievement in urban areas. Researchers and practicing educators have long known of the strong link between family background characteristics, particularly family economic status, and the academic achievement of students.
Publication Date: January 01, 2005

Do Child Characteristics Affect How Children Fare in Families Receiving and Leaving Welfare?


Previous research using the 1999 National Survey of America's Families (NSAF) found few differences in developmental risk between children in families who were currently receiving welfare and those in families that had formerly received welfare. This paper reports on new NSAF analyses revealing a pattern in which male adolescents in the families of former recipients may be faring worse than their counterparts in the families of current recipients. We also find that family income, family structure, parental employment, and symptoms of poor parent mental health differed by welfare receipt status and, for income, by gender as well, for adolescents in 1999. Yet, these differences in family characteristics did not account for the elevated levels of developmental risk found among adolescent boys in former recipient families.
Publication Date: August 02, 2004

Disconnected Welfare Leavers Face Serious Risks


About one in seven adults who left welfare recently is disconnected from both the labor market and the welfare system—that is, not working, without a working spouse, and not receiving welfare or disability benefits. The percentage was somewhat lower among those who left welfare earlier, in the years right after reform. The proportion of disconnected adults indicates the extent to which former recipients are not making successful transitions off welfare. The disconnected face significantly higher barriers to work and greater hardships than welfare leavers who work.
Publication Date: August 21, 2003

Families Coping without Earnings or Government Cash Assistance


Assessing the New Federalism is a multiyear Urban Institute project designed to analyze the devolution of responsibility for social programs from the federal government to the states, focusing primarily on health care, income security, employment and training programs, and social services. Researchers monitor program changes and fiscal developments. In collaboration with Child Trends, the project studies changes in family well-being. The project aims to provide timely, nonpartisan information to inform public debate and to help state and local decisionmakers carry out their new responsibilities more effectively.
Publication Date: February 01, 2003

Child Support Offers Some Protection Against Poverty


In 1996, Congress "ended welfare as we know it" and replaced it with time-limited benefits, strict work requirements, and stronger child support enforcement. Many experts have wondered, however, whether child support can really be a significant source of income for poor families. In fact, it already is for poor families that receive it. Child support reduces the number of poor children by a half million and lessens income inequality among children eligible for it. Unfortunately, an important caveat mars this otherwise optimistic story. About 70 percent of poor children eligible for child support were not getting it in 1996. In addition, it will probably be difficult to obtain child support for these children because their parents are, on average, more disadvantaged than the parents of poor children who already receive child support.
Publication Date: March 15, 2000