October 02, 2003

National Data, By Edwin S. Rubenstein

Poverty: The Immigration Dimension

Poverty rose for the second straight year in a row, according to Census Bureau figures released last Friday (September 26). The share of the U.S. population with income below the poverty level rose to 12.1% from 11.7% in 2001. That means nearly 1.7 million more people slid into poverty in 2002, resulting in a total of 34.6 million.

The poverty story was front-page news at the Washington Post and the New York Times, top of the media food chain. But, as usual, the word “immigration” appeared nowhere in their coverage.

Yet immigration is clearly exacerbating America’s poverty problem. Its effect is felt in two ways.

First, directly: many immigrants are themselves poor, adding to the poverty population.

Second, indirectly: immigrants compete with and displace native-born Americans, driving them into poverty.

How large a direct role does immigration play? The new Census Bureau figures show:

Immigrant poverty is significant: Of the 34.6 million U.S. residents in poverty, about 16% (5.6 million) are immigrants.

Plus another 7.5% (2.6 million) are actually the American-born minor children of immigrant mothers, counted as “U.S. natives” by the Census.

Plus the descendants of post-1965 Immigration Act influx now living in poverty – i.e. most of the 4.2 million American-born Hispanic poor and virtually all the 250,000 American-born Asian poor. That’s almost 13%.

It’s increasing: more than one in five (21%) of the persons added to the poverty rolls in 2002 were immigrants

Conclusion: well over a third (36%) of the U.S. poverty population is directly attributable to post-1965 mass immigration.

The indirect effect of immigration is harder to gauge. The Washington Post almost stumbled onto the displacement effect:

“The poverty changes in 2002 were noticeably concentrated. Poverty rates were virtually unchanged for self-identified whites, Latinos and Asians, but the portion of African-Americans in poverty rose to 24.1% from 22.7%.” [Jonathan Weisman, “U.S. Incomes Fell, Poverty Rose in 2002,” September 27, 2003.]

Of course, African-Americans, disproportionately low-skilled, are among the groups most likely to be displaced by the current mass immigration—which is also disproportionately low-skilled. Median household income of blacks fell 3.0% in 2002. Non-Hispanic white incomes showed no significant change.

Some conservative analysts see the latest poverty data as a welcome break from the past. They argue that the increase has not been as sharp as in past recessions.

But the “bad news is good news” crowd miss an inconvenient fact. The poverty rate fell like a rock from World War II until 1972. Then it stopped falling. Poverty reached its all-time low, 11.1%, in 1973—thirty years ago. It’s been oscillating sideways ever since. Not even the boom of the 1990s was able to break this pattern. For the poor, the Great American Bread Machine appears to have stalled.

Why? Of course, a lot has changed since 1973. But one factor neither official nor think-tank Washington never mentions: mass immigration, unleashed after a 40-year lull by the 1965 Immigration Act.

On Friday, October 3, the unemployment numbers come out. Look hard for any discussion of the immigration dimension. Look very hard.

Then check out my column next week.

POVERTY RATES AND INCOME FOR
IMMIGRANTS AND NATIVES, 2001-2002
			Change	% change
	2001	2002	2001-02	2001-02
	Number of Poor (1,000s)
All Persons	32,907	34,570	1,663	5.1%
Native	27,698	29,012	1,314	4.7%
Foreign Born	5,209	5,558	349	6.7%
% For. born	15.8%	16.1%	21.0%	141.2%
Hispanic	7,997	8,555	558	7.0%
Black	8,136	8,884	748	9.2%
non-Hispanic white	15,271	15,567	296	1.9%
	Poverty Rate (%)
All Persons	11.7%	12.1%	0.4%	3.4%
Native	11.1%	11.5%	0.4%	3.6%
Foreign Born	16.1%	16.6%	0.5%	3.1%
	Median Household Income (2002 dollars)
All Persons	$42,900	$42,409	-491	-1.1%
Native	43,600	43,222	-378	-0.9%
Foreign Born	38,552	37,979	-573	-1.5%
Foreign born as % Native	88.4%	87.9%	151.6%	171.4%

Sources: Census Bureau, Poverty in the United States: 2002, September 2003.

Census Bureau, Income in the United States: 2002, September 2003.

Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants in Indianapolis.