Poverty rate ended four-year rise in '94 Median household income continued stagnant trend

October 06, 1995|By KNIGHT-RIDDER NEWS SERVICE

WASHINGTON -- The poverty rate fell in 1994 for the first time in four years, the Census Bureau reported yesterday, but median income remained stuck -- a sign that gains from a surging economy are not getting through to all middle-class households.

The census also found that nearly one in seven Americans -- 39.7 million people -- lacked health insurance in 1994, about the same as the previous year.

Single mothers and black families gained ground in 1994, but full-time workers and single people living alone were losers.

The income and poverty numbers, based on an annual survey of 60,000 households, provide fresh material for the continuous debate about the fair distribution of America's wealth.

Median household income was $32,264 in 1994. It was only a $223 increase from 1993. Median household income has yet to recover the ground lost during the 1990-1991 recession. It peaked in 1989 at $34,445, adjusted for inflation.

However, the poverty rate dropped to 14.5 percent in 1994 from 15.1 percent the previous year. The number of Americans in poverty declined by 1.2 million to 38.1 million. For children, the poverty rate fell nearly 1 percentage point to 21.8 percent. The poverty threshold for a family of four was $15,141 in 1994.

The household income figures include salaries and other cash payments, but not such things as fringe and government program benefits.

Among regions of the country, the South continued to catch up. Median household income rose 2.9 percent in the South, faster than in other regions. The poverty rate in the South fell for the first time in 10 years to 16.1 percent. Traditionally, incomes have lagged in the South, while poverty has been higher.

Advocates for the poor pointed to census findings that the gap between rich and poor continues to widen. Also, the middle 60 percent of households -- making between $13,426 and $62,841 -- are getting a smaller share of total income.

"At a time when most of the income gains are going to those at the top of the scale, why should we lavish tax cuts on the wealthiest families?" asked Robert Greenstein, director of the Center on Budget and Policy Priorities, a liberal advocacy and research group.

Mr. Greenstein said his analysis of the census numbers showed that only the top 20 percent of families have recovered income losses from the last recession.

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