Updated: 6/26/2012 10:05 AM ET|
Poverty has a new address: Suburbia
There are now 2.7 million more poor households in the suburbs than in cities, thanks to long-term trends that have accelerated in the current economic downturn.
For years, the food pantry in Crystal Lake, Ill., a bedroom community 50 miles west of Chicago, has catered to the suburban area's poor, homeless and unemployed. But Cate Williams, the head of the pantry, said earlier this year that she has noticed a striking change in the makeup of the needy over the past year or two.
Some families that once pulled down six-figure incomes and drove flashy cars are turning to the pantry for help. A few of them donated food and money to the pantry before their luck soured, according to Williams.
"People will shyly say to me, 'You know, I used to give money and food to you guys. Now I need your help,'" Williams told The Fiscal Times. "Most of the folks we see now are people who never took a handout before. They were comfortable, able to feed themselves, to keep gas in the car and keep a nice roof over their head."
Suburbia always had its share of low-income families and the poor, but the sharp surge in suburban poverty is beginning to grab the attention of demographers, government officials and social service advocates.
The past decade has marked the most significant rise in poverty in modern times. One in six people in the U.S. is poor, according to the latest census data, compared with one in 10 Americans in 2004. This surge in the percentage of the poor is fueling concerns about a growing disparity between the rich and poor -- the 99% versus the 1%, in the parlance of the Occupy Wall Street movement.
But contrary to stereotypes that the worst of poverty is centered in urban areas or isolated rural areas and Appalachia, the suburbs have been hit hardest in recent years, an analysis of census data reveals. "If you take a drive through the suburbs and look at the strip mall vacancies, the 'For Sale' signs, and the growing lines at unemployment offices and social services providers, you'd have to be blind not to see the economic crisis is hitting home in a way these areas have never experienced," said Donna Cooper, a senior fellow at the Center for American Progress, a progressive think tank.
In the wake of the Great Recession, poverty rolls are rising at a more rapid pace in the suburbs than in cities or rural communities. From 2000 to 2010, the number of suburban households below the poverty line increased by 53%, compared with a 23% increase in poor households in urban areas, according to a Brookings Institution analysis of census data.
In 2010, there were 2.7 million more suburban households than urban households below the federal poverty level, according to the Bureau of Labor Statistics. That was the first time on record that America's cities didn't contain the highest absolute number of households living in poverty. There are many reasons for the dramatic turnabout in the geographic profile of poverty.
While many once-depressed urban areas have benefited from revitalization efforts, drawing in more affluent residents, suburban areas now attract lower-income families who move there in search of more-affordable housing and better schools. This shift in low-income families to the suburbs coincided with a move of low-wage, low-skilled jobs to those same suburban areas from the 1970s to the early 2000s, experts say. Meanwhile, the introduction of new commerce and high-cost housing in urban neighborhoods has pushed overall prices upward, providing added incentive for low-income people to head for the suburbs.
"These are families that were living on the edge in the city, but in many cases over the last 20 to 30 years, regained some stability when they found affordable housing in the suburbs," said Cooper. "Now, the economy tanks, they lose their jobs, they're poor, and they're out in the suburbs on the edge once again."
Both urban and suburban America were badly hammered by the financial meltdown and recession, which has led to stubbornly high unemployment, widespread foreclosures and "underwater" homes, high food and gas prices, and sharp cutbacks in government and private social services. But the overall impact has been worse in suburban areas, because many low-skilled jobs disappeared along with the plants and businesses that once provided employment. Other companies shifted their business strategy toward developing a high-skill, high-tech labor force.
More from The Fiscal Times:
- 9 worst recession ghost towns in America
- Homeless in America: One family's story
- 11 irreverent messages for the unemployed
To be sure, the picture of poverty in U.S. suburbs is an uneven one. According to the census analysis, some suburban regions took bigger economic hits than others. Poverty rolls increased 121.8% in the Atlanta suburbs from 2000 to 2010, compared with a 6.8% increase in the city. Chicago and Seattle saw similarly large suburban/urban splits in poverty during that period. The poverty rate increased by 76.3% in the Chicago suburbs, compared with only 9.7% in the city. In Seattle, the number of people living below the poverty line rose 74.4% in the suburbs versus 26.1% in the city proper.
The 10-year surge in suburban poverty is putting enormous budgetary pressure on county and local governments and nonprofits, which are struggling to meet a rising demand for social services, counseling and financial assistance. The number of students qualifying for subsidized lunches in Conyers, an Atlanta suburb, grew by 63% in 2011, compared with a 46% increase in 2006. Many suburban areas of Columbus, Ohio, have seen their subsidized lunch enrollment more than double over the past five years, the Columbus Dispatch reported last year.
According to a separate 2010 census analysis from the Brookings Institution, the typical suburban nonprofit in the Los Angeles, Chicago or Washington, D.C., region reported an increase of about 30% in demand for its services from 2008 to 2009, as well as a substantial increase in the number of clients with no previous connection to social service programs. Adding further pressure, nearly half of the nonprofit organizations reported a loss in key revenue in that time.
"This is a shift that's happened over time, steadily over the last 10 years, and for reasons in addition to the recession," said Elizabeth Kneebone, a senior research associate at Brookings who compiled the data. "Even if the recovery were to take hold tomorrow, I wouldn't expect this to reverse."
In Gwinnett County, another Atlanta suburb, a ballooning foreclosure crisis is forcing once middle- and upper-income residents into poverty. One in 183 housing units received a foreclosure filing in November, compared with a national average of one in 579 units, according to RealtyTrac.
A nonprofit called The Impact! Group handles about 60% of the county's cases of homeless individuals in need of temporary housing to help them get back on their feet. Five years ago, Tom Merkel, the president and CEO, and the group's 10 staffers almost exclusively served individuals with four- and low-five-figure salaries. By this year, Merkel says, his caseload has doubled. It has also climbed the socioeconomic ladder, with an ever-increasing number of once middle- and upper-middle class families seeking aid, he adds.
"We have people that were making six-figure salaries, doctors and lawyers who lived in nice homes on golf courses, knocking on our door," Merkel told The Fiscal Times. "People spent beyond their means without learning to save, so when everything came crashing down, there was no reserve."
In the Seattle suburbs, the challenges of a burgeoning refugee and immigrant population are compounding economic pressures. In King County, which encompasses both Seattle and neighboring suburbs, half of the population growth over the last two decades has come from immigrants and refugees, said Chandler Felt, King County's demographer. The vast majority of those foreign-born new residents have settled into South King County suburbs, including Kent, rather than Seattle, as they seek to take advantage of more affordable housing, Felt said.
The surge in refugees and immigrants from East Africa, Eastern Europe and Southeast Asia settling in Kent has made the community more culturally diverse, but it has also helped push the poverty rate to 25%, compared with 9% 10 years ago, said Katherin Johnson, Kent's housing and human services manager.
"All of a sudden, the resettlement agency's finished with you six or eight months after you arrive, you're not able to find a job, and you're just starting to learn the language and assimilate," Johnson said. "The next thing that happens is you have eviction notices, your utilities are turned off, and you have no finances to speak of." The city has seen thousands of cases like that, she said. "The food pantry here is a very popular place."
For Williams in Crystal Lake, the pantry's growing traffic has meant food vanishes more quickly. Two or three years ago, a food drive's proceeds would last four or five months, but now that food is gone in two to three months. The rising demand has led Williams and her board to dip into their savings to keep dispensing basic food items like butter, cheese, milk and eggs.
"Every day, it gets just a little clearer that people's ideas of who a hungry or poor person is should be changing," Williams said. "It's not just people pushing shopping carts along the street in a place like Crystal Lake. . . . Sure, people may still have their Lexus, but what lots of people don't realize is that in lots of cases, (the car) is one step away from being repossessed."
More from The Fiscal Times:
VIDEO ON MSN MONEY
Redistribution of wealth. It already happened and the government didn't do it. Unions were given a bad name, eliminated and companies took advantage. Your pension disappeared and you were told to fund your own 401k - that's a pay cut. Companies didn't force health care companies to control cost, they just passed it on to you - that's a pay cut. Workers were laid off and if you were lucky to survive, you worked longer hours without compensation - that's a pay cut. Did your company eliminate any other employee benefits - pay cut. And where did the money go? To that "special talent" that runs the company.
The recession will end when the Middle Class gets paid what they should. The money is there. The redistribution that has already happened needs to be reversed.
First off, the numbers and categories used to compute "poverty" in America are ridiculous. Household non-cash assistance (WIC, Food Stamps, and other subsidies like child care assistance and Medicaid) are not factored in.
In addition, I totally refuse to classify a home with a car, color TV, cable, gaming boxes, a computer with internet, free education, assistance with child care, and no more than two people to a bedroom as "poor", regardless of what our government says.
And how many of these folks used their house like an ATM during the boom years, buying toys and trips and not saving a penny??
Sure, there are legitimate hard luck stories, usually involving an illness or accident. For the most part, these foolish people made their choices and are living with them now.
Some of this article is actually incorrect. Note the featured mom in the article - her husband is a fricking ENGINEER. I have a postgraduate education in IT (+ 10 years experience + management experience). You have now not just low-skill, low-wage people unable to find jobs, but tens of millions of high-skill, high education people (with SUPPOSEDLY IN DEMAND skills/education!!!) out of work and unable to BUY a living-wage job in ANY field anywhere in the US. Overeducated! Overqualified! What's WRONG with you that you're applying for THIS (out of your field) job?
Why? Because most of our jobs have been outsourced. It begain when the tech bubble burst in 2002 and those tens of millions were out of jobs. Now it's engineers, systems people...and it's spreading like a cancer. We worked hard, got good educations in fields with tremendous global demand...but now we need to go to India, or China, or some other low-wage country in order to feed our families ourselves. Even those of us who did everything right - paid our student loans, minimal credit card debt, bought cars and homes way below what the lenders wanted to give us (my home is actually NOT underwater, thanks)...we now find ourselves unable to find good jobs. So we're taking jobs that normally our high school children would have in a healthy economy - and we work our @$$es off still unable to pay basic needed bills like food and heat.
Ross Perot was the canary in the coalmine. He told us over 20 years ago that this would happen and most people said he was a kook and laughed him out of town. Now he's sitting in his bark-o-lounger somewhere shaking his head at all those fools saying "I told you so". Those of us in Economics who knew he was right can only weep that we were outnumbered by sheeple and fools. I hope you people are happy.
One thing is certain.......the tide never turns on this sort of thing. If you are knowledgeable with regard to history and economics, you understand that, too many at the bottom and a few at the top is akin to a snowball rolling downhill. I have yet to see that snowball reverse its course. Oh sure, you'll get a little bump in the economic indicators every so often but that's about it. What's brewing is a recipe for anarchy. It won't be happen today, tomorrow, next week, next month or even next year. But it will happen. Too many people vying for jobs that are offering less and less pay and benefits. The tipping point? When one is working but cannot make ends meet and not because they are living beyond their means but because the pay scale does not support a mortgage or rent, utilities, food, a car payment, clothing.....you know, the necessities. Not everyone is in a position to make 6 or 7 figures annually. People understand that. But for those that do not, why are they being squeezed to death to try to simply have a modest roof over their heads or dinner on the table? Why do companies not want to pay a living wage? I think we all know the answer to that. It's looking more and more like I need a one-way ticket out of this country.
I must get 10 calls a week from one poster child organization or another to feed the homeless, cure disease, help abused women and saved the spotted owls.
I say, "Other than money, how can I help?" Then, the phone goes dead. LOL!
STOP THE WARS! We can't afford them.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
RECENT ARTICLES ON FAMILY & MONEY
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'