The Recession’s Broad Impact on Pennsylvania Communities

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On September 28, 2010, the U.S. Census Bureau released results from its 2009 American Community Survey (ACS). This report provides a snapshot of health insurance coverage and trends in poverty and median household incomes in local communities across the nation. The initial release included data for counties, metropolitan areas, and municipalities with populations of 60,000 or more.

Poverty holds steady for Pennsylvania, although some communities see increases

In Pennsylvania, poverty rates remained essentially unchanged, rising from 12.3% in 2008 to 12.5% in 2009 (Table 3).1 The poverty rate has increased by just under a percentage point since 2007 (before the recession began) - going from 11.6% to 12.5%.

Since 2007, four metropolitan areas in Pennsylvania have seen poverty rates rise (details for all Pennsylvania metro areas can be found in Table 3):

  • Allentown-Bethlehem-Easton (8% to 10.2%),
  • Pittsburgh (11.2% to 12.3%),
  • Scranton-Wilkes-Barre (11.9% to 13.8%) and
  • State College (15.1% to 19.3%).2

Since 2007, five counties have seen a rise in poverty rates (county poverty data is listed in Table 4):

  • Allegheny (11.7% to 13.3%),
  • Centre (15.1% to 19.3%),
  • Dauphin (11.1% to 13.3%),
  • Lackawanna (12.8% to 15%) and
  • Lehigh (8.6 to 12.7%). 

Unemployment compensation played a pivotal role in blunting the rise of poverty in Pennsylvania in 2009 - as did key provisions of the American Recovery and Reinvestment Act, including temporary expansions of the Earned Income and Child Tax Credits. Unemployment compensation for laid off workers saved 3.3 million Americans and as many as 120,000 Pennsylvanians from falling into poverty, according to data provided by the Census in the Current Population Survey (CPS).3

Pennsylvania’s poverty rate also held steady in 2009 because the time period covered marked only the beginning of massive job losses that occurred in the wake of the recession. The ACS report, consequently, provides only a partial snapshot of the fallout from that downturn. Higher poverty and uninsured rates are likely to be on the horizon for Pennsylvania.

For this reason, Congress should extend several Recovery Act provisions for middle- and low-income households and continue funding for Pennsylvania’s “Way to Work” program, which helps employ low-income workers. (Funding for “Way to Work” expired on September 30.) Until the job market and family incomes fully rebound from the recession, many more people will be at risk of falling into poverty without policy actions to keep our fragile economic recovery on track.

Recession puts a dent in Pennsylvania’s middle class

Median household income in Pennsylvania, at $49,520, was slightly lower than the national figure of $50,245. Pennsylvania median household income declined by 1.4% percent ($725) from 2008 to 2009 as the recession continued to put downward pressure on the earnings of middle-class Pennsylvania families.

Median household income for 2009 is listed by metro area in Table 3 and by county in Table 4.

Rural Pennsylvanians more likely to be uninsured4

In 2009, Pennsylvania’s uninsured rate continued to trail the nation’s rate - a long-standing trend for the Commonwealth. Table 1 shows the uninsured rate among working-age adults in the U.S. is a full one-third higher than Pennsylvania’s rate - 20.6% nationally compared to 13.7% in Pennsylvania. Nationally, 45.7 million people lack health coverage, while 1.2 million Pennsylvanians are without coverage.

Children in rural Pennsylvania are twice as likely to lack coverage as their urban neighbors (8.6% in rural regions compared to 4.3% in urban areas).5 This difference may indicate either a lack of access to or awareness of programs like the Children’s Health Insurance Program (CHIP) and Medical Assistance.

The uninsured rate among working-age adults is much higher than the uninsured rate among children in all parts of Pennsylvania. The rates vary little from urban to rural settings. These figures reflect a decade of declining rates of employer-sponsored health insurance in Pennsylvania and underscore the vital need for health reform here and across the nation.

Table 1. 2009 Uninsured Rates

  All Ages Children (0-17) Working Age Adults (18-64)
United States 15.10% 8.60% 20.60%
Pennsylvania 9.90% 5.30% 13.70%
  - Rural PA 10.50% 8.60% 13.60%
  - Urban PA 9.70% 4.30% 13.70%

Uninsured rates by county (with populations of 60,000 or more) can be found in Table 5.

Cities home to lower median incomes, higher poverty, more uninsured than host counties

By three important measures (median income, poverty rate, and uninsured rate), Pennsylvania’s largest cities are doing worse than the counties in which they are located. This illustrates the “hollowing out” of traditional urban centers, as described by the Brookings Institution, where population and wealth move out to suburban and exurban communities, creating high concentrations of poverty.6

Median income in these six municipalities is roughly one quarter less than in their host counties. Poverty rates in Reading and Allentown are more than twice the rates found in Berks and Lehigh counties. There is less variation in the rate of the uninsured, due in part to public programs like CHIP and Medical Assistance.

Table 2. Comparing Major Pennsylvania Cities to their Host Counties, 2009

Municipality Median Income Poverty Rate Uninsured Rate   Host County Median Income Poverty Rate Uninsured Rate
Allentown $33,664 29.00% 17.90%   Lehigh $53,260 12.70% 10.40%
Bethlehem 42,927 17.3 10.3   Northampton7 58,325 8.4 8.9
Erie (city) 32,136 23.1 10.8   Erie 42,888 15.8 8.7
Pittsburgh 37,461 23.1 10.2   Allegheny 46,215 13.3 8.6
Reading 28,597 33 21.3   Berks 53,485 12.5 10.9
Scranton 38,774 18.7 10.7   Lackawanna 44,481 15 8.5
Upper Darby 49,193 12.5 14.7   Delaware 62,385 9.2 8.3

Click on the links below for additional tables detailing data from the ACS:

Table 3. Poverty Rates (2007-2009) and Median Household Income (2009) in Pennsylvania Metropolitan and Micropolitan Areas

Table 4. Poverty Rates (2007-2009) and Median Household Income (2009) in Pennsylvania Counties

Table 5. Uninsured Rates by County and Age Group, 2009

Endnotes

[1] The ACS is a different, more detailed survey than the Census Bureau’s Current Population Survey (CPS) - the results of which were released on September 16. The CPS set Pennsylvania’s poverty rate at 11% for the two year period 2008-2009.

[2] The Census Bureau cautions against making year-to-year comparisons of data for sub-state areas (any area below the state level) when large portions of the population are in "group quarters" - as is the case in the State College area due to Penn State University.

[3] Based on CPS data, the Census Bureau estimates that unemployment compensation kept 3.3 million Americans out of poverty in 2009. Pennsylvania's share of all unemployed in 2009 was 3.6%. Taking that share of 3.3 million Americans allows us to estimate the number of Pennsylvanians likely kept out of poverty because of unemployment compensation.

[4] The ACS’s data on health insurance coverage is not directly comparable to the information released in 2008, so only a snapshot of coverage will be detailed here.

[5] Rural and urban classifications are from the U.S. Census Bureau.

[6] The Brookings Institution, Back to Prosperity: A Competitive Agenda for Renewing Pennsylvania, December 2003 http://www.brookings.edu/reports/2003/12metropolitanpolicy_pennsylvania.aspx.

[7] The city of Bethlehem is actually in two counties, Lehigh and Northampton.