New Census Data on Poverty, Income, and Health Coverage Show Need for Robust Federal Recovery Package

The economic loss and hardship of COVID-19 and its new variants are far from over for Pennsylvania communities – particularly Pennsylvanians of color and those with low incomes. The need for strong public investments that grow the economy, protect families, and reduce racial and economic inequalities remain as critical today as they were a year ago.

According to new national data from the U.S. Census Bureau’s Current Population Survey, the median household income fell by 2.9% in 2020 – a result of the COVID-19 recession, which was one of the deepest and the most unequal in US history. Yet despite the unprecedented downturn, the poverty rate fell from 11.8% to 9.1%, the lowest rate in history. In Pennsylvania, the two-year poverty rate fell from 11.4% in 2017-2018 to 9.7% in 2019-2020.

Underlying the Census’s picture of poverty, income, and health coverage in 2020 is the critical role that unemployment insurance, nutrition assistance, Medicaid coverage, and paid sick leave played in mitigating the extreme harms of the health and economic crisis – all of which were made possible by the Families First Coronavirus Response Act, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the American Rescue Plan, and other much-needed federal investments.

Despite these important strides in alleviating pandemic-related economic challenges for Pennsylvania families, more federal action is needed to tackle long-standing economic hardship and inequity that predated COVID-19.

“Pennsylvanians are not out of the dark yet. Families here continue to face difficult choices about how to put food on the table, pay rent, and hold down jobs given the risks and complexities created by the delta variant,” said Marc Stier, director of the Pennsylvania Budget and Policy Center. “Our federal and state policymakers cannot turn a blind eye to this continued hardship, especially in Black, Latino, Indigenous, and immigrant communities.”

In the months ahead, federal and state lawmakers can put forward meaningful and lasting policy solutions:

Federal: Lawmakers have the opportunity to fundamentally improve Pennsylvanians’ lives and build a fairer, more equitable economy with the Build Back Better legislation currently under consideration in Congress. The PA Budget and Policy Center is urging PA’s delegation to ensure the final bill strengthens the nation’s weak unemployment insurance system, closes the Medicaid coverage gap, invests in affordable housing, and makes the full Child Tax Credit permanent for families with low or no earnings. The Build Back Better investments should be funded by closing loopholes that allow the wealthiest individuals and corporations to pay little or no federal income tax, and by strengthening IRS enforcement to ensure those at the top pay what they owe.

State: Pennsylvania lawmakers must meet the demands of the moment by using the $7.5 billion in the American Rescue Plan and state budget surplus funds to provide support to working people, especially front-line workers, the unemployed, small businesses, and families still hurting from the pandemic.