PROVIDENCE, RI – Nationally, the overall poverty rate and child poverty rate rose by the largest amount on record in more than 50 years, according to new US Census data released this week. The data also reveal that too many Rhode Islanders — over 113,000, or 10.8% — live in poverty.
The increase in hardship was a result of the expiration of pandemic relief efforts that boosted household incomes and economic security, such as the expanded Child Tax Credit.
“Congress allowed many proven effective anti-poverty policies to lapse, and greater hardship is the result,” said Weayonnoh Nelson-Davies, Executive Director of the Economic Progress Institute. “We have the tools to ensure more Rhode Islanders have a strong foundation upon which to prosper and thrive. If we use them, we can reverse the backslide we saw in 2022.”
These findings come from analysis by the Economic Progress Institute of new data on poverty, income, and health coverage in 2022, released this week by the U.S. Census Bureau.
The expanded federal Child Tax Credit was responsible for a major portion of the record reduction in child poverty in 2021, lifting 2.1 million kids out of poverty. Congress’s decision to allow the Child Tax Credit to expire at the end of 2021 is a major contributor to the increase in national poverty levels in 2022. Had Congress continued the American Rescue Plan’s Child Tax Credit increase in 2022, about 3 million fewer children would have experienced poverty in 2022 — preventing more than half of this year’s increase.
"The bad news is that because policymakers didn’t stand by those investments, more families and children will go without the essentials like stable housing and enough food to eat."
“The good news is that policies like the expanded Child Tax Credit and nutrition support were incredibly effective in keeping families out of poverty,” said Alan Krinsky, Director of Research & Fiscal Policy for the Economic Progress Institute. “The bad news is that because policymakers didn’t stand by those investments, more families and children will go without the essentials like stable housing and enough food to eat.”
According to the Census Bureau’s Official Poverty Measure (OPM), the poverty rate in Rhode Island was 10.8% and the child poverty rate was 11.3% in 2022. That is only a partial picture of hardship in the state, and does not account for important factors like the cost of living, essential expenses, regional differences or — most critically — the seismic changes in tax and social safety net policies in 2022, when proven pandemic relief programs were allowed to lapse.
Researchers with the Economic Progress Institute recommend using the Supplemental Poverty Measure (SPM), which paints a more comprehensive picture. The less complete OPM shows poverty remaining flat nationally, while the SPM reveals poverty’s sharpest increase in more than 50 years.
The Supplemental Poverty Measure is not available on an annual basis at the state level, but because nearly all children benefited from the expanded Child Tax Credit and federal stimulus payments in 2021 and lost them in 2022, analysts expect the same dynamic to have played out in Rhode Island.
Even if the Child Tax Credit is restored, differences in poverty rates by race and ethnicity persist.
“According to the new Census Bureau data, Latino Rhode Islanders experience poverty at nearly triple the rates of Non-Latino White Rhode Islanders,” said Nina Harrison, Policy Director at the Economic Progress Institute. “Black Rhode Islanders experience poverty at nearly double the rate of their White counterparts. In order to improve equity in RI, it is imperative that policymakers consider the effects that the policies and budgets they advance will have on all races and ethnicities.”
The Child Tax Credit is not the only critical pandemic relief effort for which expiration is increasing hardship for Rhode Islanders. The data released Thursday shows that in 2022, the number of uninsured Rhode Islanders remained near historic lows as a result of pandemic policies such as Medicaid coverage protection and enhanced premium tax credits for marketplace insurance plans. But those figures do not reflect coverage loss underway this year after Congress allowed Medicaid coverage protection to expire in April. So far, 8,000 Rhode Islanders have lost their health care coverage – many as a result administrative burden, not a change in eligibility.
The Economic Progress Institute is a non-partisan research and policy organization that works to ensure the economic security of low- and modest-income Rhode Islanders.