After dropping for nearly a decade, the number of Americans living in extreme poverty is on the rise

In 2003, what was then the Brookings Center on Urban and Metropolitan Policy (now the Metropolitan Policy Program) issued the report "Stunning Progress, Hidden Problems." In it, Paul Jargowsky revealed a dramatic reversal of a trend he had chronicled in his landmark 1997 book, Poverty and Place. After roughly doubling in the 1970s and 1980s, the population of extremely poor neighborhoods - those in which at least 40 percent of residents lived below the federal poverty line - dropped by one-fourth in the 1990s. 

The report earned headlines suggesting that a problem that was once thought intractable could, in the right sort of economy and with the right sorts of housing and income policies, diminish over time. With fewer poor people exposed to the negative effects of these neighborhoods like low-performing schools, higher crime, poor public health, limited access to jobs and services, the opportunity to reduce poverty seemed more within reach.

Those were the days.

Fast-forward to today, and we’re nearly back where we started. Our new report finds that between 2000 and 2005-09, the population in extremely poor neighborhoods climbed by more than one-third, from 6.6 million to 8.7 million.  The share of poor people living in these sorts of neighborhoods, and thus confronting the "double burden" of their own poverty and the poverty of those around them, grew from 9.1 percent to 10.5 percent during that time.

What happened?  To begin, many metropolitan areas never recovered from the decade’s first downturn, in 2000. Midwestern and Northeastern Rust Belt metro areas, and several in the South, experienced the steepest increases in concentrated poverty as they shed manufacturing jobs and income throughout the decade. Chicago and Detroit chalked up among the largest declines in the 1990s but yielded back much of that progress in the 2000s.

At the same time, many regions experienced a spread of concentrated poverty to their suburbs, reflecting a larger trend of poverty suburbanization across the country. In metro areas like Palm Bay, Greenville, and Fresno, the housing market crash in the late 2000s resulted in massive job losses and plunged residents of many newer suburban communities below the poverty line.

What’s more, the picture today likely looks quite a bit worse than much of our report reflects. With the American Community Survey replacing the decennial census long form, the Census Bureau now reports socioeconomic data for neighborhoods only in five-year rolling averages. The 2005-09 period on which our analysis was based aggregates two different economic epochs: a growing economy in 2005-07, and a sharply contracting one in 2008-09. For instance, we know that in 2010, the poverty rate for U.S. metro areas was 14.4 percent, up significantly from 12.4 percent in the 2005-09 period.

Given past trends, we estimate that the concentrated poverty rate in U.S. metro areas grew to 15.1 percent in 2010 - up considerably from 11.7 percent in 2005-09, and nearing its 1990 high of 16.5 percent. Many of the Sun Belt metro areas that posted modest gains against concentrated poverty in the 2000s, like Bakersfield, Stockton, and Charleston, likely gave back all that progress late in the decade amid devastating increases in unemployment and overall poverty.

All this makes William Julius Wilson’s observations in 2003 about our last report’s findings look especially prescient. He wrote that "the favorable trend of the 1990s may be temporary rather than long term," given the job losses already occurring at the start of the decade. Of course, those losses look rather modest now compared to what the Great Recession has wrought.

This research merely confirms what we've suspected for some time: extremely poor neighborhoods and their residents are last to benefit from growth when times are good, and first to feel it when tough times arrive. Progress against concentrated poverty is possible when growth is strong and sustained, and buttressed by housing, education and transportation policies that guard against segregating poor families. With projections of high unemployment for years to come, the outlook for this indicator is grim. 

But that's no excuse to throw up our hands in the fight against concentrated poverty. If anything, we need to redouble our efforts at growing not just any old jobs, but better-paying jobs, and jobs that are accessible to workers living in these disadvantaged communities. Now that we’re finally paying attention to rising inequality in America, it's a good time to focus on helping the places that bear the most severe burdens of an increasingly unequal society.

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