Rags, riches, repeat.


It’s the American dream: start off poor and move up the ladder of success. But no one ever mentions the part where you move up and down the ladder, a few rungs forward and a few back again.

But a recent report from the U.S. Census Bureau looks at poverty in a new way. Using longitudinal data collected between 2001 and 2006, the report shows that the majority of people who are included in the poverty rate don’t stay there long.

But who stays there and for how long depends largely on who you are: your race, your age and your family.

When the census bureau looked at a sample of people living in poverty from 2004 to 2006, they found that only a small slice were continuously poor. Only 23 percent of people who were poor in 2004 remained poor until 2006.

The rest dealt with “episodes” of poverty. During this two-year period, people entered and exited poverty, some staying for just a few months and others much longer.

How long did people stay poor? Just under half of people who experienced episodes of poverty during this two-year span were poor for just two to four months. Another 20 percent were poor for five to eight months.

But not everyone had the same chance of rising out of–or sinking back down into–poverty. Poverty episodes were much longer for five groups of people: female-headed households, children, seniors, African Americans and Hispanics. Take a look:

Median Length of Poverty Spell.png

Who had escaped poverty by 2006? Very different groups of people. White people, married couples, male-headed households and adults were much more likely to be out of poverty by the time the study ended.

But even when a family technically “exited” poverty, they were still
likely to be fairly poor. When they looked at people who were poor at
the beginning of 2004, but weren’t by 2006, more than half of them lived at
150 percent of the poverty level. So while they passed the government
standards, they weren’t exactly living large.

Have you ever experienced an “episode” of poverty, or have you seen someone in your family or circle of friends deal with this? How did you get in and how did you–if you did–get out? Share your experience.

Photo credit: Ben Ortstrowsky

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