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POVERTY AND POLICY MATTERS: Economic Recovery Continues to Bypass Communities of Color in North Carolina

North Carolina’s communities of color were more than two times as likely to live in poverty as whites in 2011, according to a report released last week by the North Carolina Budget and Tax Center. People of color were particularly hard hit by the Great Recession and the previous economic conditions and policy decisions that resulted in less access to pathways to the middle class. U.S. Census Bureau data show that the ongoing economic recovery from the recession is only serving to exacerbate the long-entrenched racial disparities in poverty.

The federal poverty level in 2011 was $23,021 annually for a family of four.

As illustrated in the chart below, the 2011 poverty rate for communities of color remained well-above the state’s poverty rate and the rate for white residents. The poverty rate for Latinos was 22.8 percentage points above the figure for their white counterparts. The disparity was smaller for African Americans and American Indians/Alaska Natives whose poverty rates were 15.9 and 14.9 percent points higher than the rate for whites, respectively. Overall, the poverty rates for these communities of color were more than twice the rate for white residents.

More troubling, child poverty rates are consistently higher than the poverty rate for the average North Carolinian. This disparity also holds true for communities of color compared to white children. The child poverty rate for African Americans was 25.9 percentage points higher than the rate for white children. The disparity stood at 24 percentage points for American Indian/Alaska Native children and 20.4 percentage points for Latino children. Overall, the poverty rates for African American, Latino, and American Indian children were two-and-a-half to three times higher than the rate for white children.

Since 2007—the year the Great Recession began—poverty rates are growing for the average North Carolinian. However, economic opportunities appear to be eroding faster for some communities of color than whites. From 2007 to 2011, the growth in poverty increased by 2.5 percentage points for whites, compared to 9.1 percentage points for Latinos and 3.3 percentage points for African Americans. The change in poverty during this period was not statistically significant for American Indians/Alaska Natives.

Racial differences in poverty levels are largely driven by a lack of access to jobs and an earnings gap, a legacy of slavery and discrimination, and a lack of equity in public and private investments in certain communities. As the persistence of the racial poverty gap holds strong, it is important to reverse these troubling trends. Lawmakers should enact policies that make sure that communities of color are able to benefit from the economic recovery. This goal requires targeted policies not only at specific problems—like tackling the jobs deficit—but policies aimed at certain communities.

We must pledge to #talkpoverty and develop the will to solve these problems.

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POVERTY AND POLICY MATTERS: Economic Recovery Continues to Bypass Communities of Color in North Carolina