Lessons From a Historic Decline in Child Poverty

September 11, 2022

Chapter 6. Lessons From the Decline in Child Poverty and Policy Recommendations

The historic decline in child poverty, which occurred amid dramatic changes in our social safety net policy and substantial economic and demographic shifts, is a powerful blueprint that can guide public officials in maintaining (and, for some groups, accelerating) the progress of the last quarter century. The sheer scale of the decline should inspire new conviction that child poverty is a solvable problem, and nurture the hope that, in time, childhood poverty—when it does occur—will be rare and short-lived.

As of 2019, 11 percent of children live in poverty. A subset of that group, 3 percent of all children, lives in deep poverty. Further, children in families just above the poverty threshold experience economic hardship and are at risk of falling into poverty after simple, sudden changes: a reduction in parent work hours, a loss of work, or an unexpected expense or family emergency. Our collective work to protect children from poverty is not over. Continued progress in reducing child poverty will require building new consensus in support of investing in the nation’s children. While 2021 marked a significant federal commitment to safeguarding children through an expansion of the Child Tax Credit (CTC), that funding expired at the close of the year without a plan to extend or replace it.

Work remains, but the past can guide us. Public officials should consider the following lessons from our nation’s dramatic decline in child poverty and advance our five recommendations to further protect children.

Section 1: Six lessons from the decline in child poverty

We now share what we think are the most powerful lessons from our analyses about how to safeguard children from poverty.

Lesson 1. A strong economy and tighter labor market contributed to the national decline in child poverty, but economic health is not sufficient to protect children from poverty.

Gross domestic product (GDP) per capita and median wages both grew from 1993 to 2019, yet our analyses suggest that neither of these were associated with the decline in child poverty. That is, as the United States achieved economic growth, the fruits of that prosperity didn’t reach children experiencing poverty or deep poverty. Unemployment rates, single mother labor force participation rates, and state-level minimum wages emerged as key levers to combat poverty and, together, explained about 33 percent of the decline in child poverty.

Lesson 2. Much of the national decline in child poverty was due to the nation’s social safety net.

Beginning in 1993, the social safety net began to play a dramatically increased role in protecting children from poverty. At the start of the decline, in 1993, the entire social safety net lowered child poverty by 9 percent. In 2019, the social safety net lowered child poverty by fully 44 percent. This increase was driven largely by the growing role of the Earned Income Tax Credit (EITC) in reducing child poverty. Without the social safety net, an additional 6.5 million children would have lived in poverty in 2019. The EITC, Social Security, and the Supplemental Nutrition Assistance Program (SNAP) protected the most children from poverty in 2019.

Lesson 3. While the social safety net’s role in reducing child poverty grew considerably from 1993 to 2019, the United States has made little progress in strengthening the social safety net for children with the least economic resources.

The social safety net continues to play an important role in protecting children from deep poverty: It reduced deep poverty rates by about two thirds in both 1993 and 2019. The relative stability of its role in reducing deep poverty, however, stands in stark contrast to the growth of its role in reducing child poverty as a whole over this time. This pattern is largely due to a remarkable decline in the Aid to Families with Dependent Children (AFDC) program (now Temporary Assistance to Needy Families, or TANF), from the most powerful anti-poverty program for children in deep poverty to one of the most negligible. Following the passage of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) in 1996, and continuing until 2006, the role of the social safety net in reducing deep poverty declined, and deep poverty rates among children increased. The role of the social safety net in protecting children from deep poverty increased again, however, with the introduction of temporary measures during the Great Recession, and much of the decline in deep poverty rates among children occurred after the economy strengthened again in the 2010s. Children in deep poverty are in greatest need of economic support and yet, for them, the social safety net has become progressively tenuous, if not threadbare.

Lesson 4. Barriers to accessing employment and social safety net programs harm our nation’s capacity to further reduce child poverty, particularly for children in immigrant families and children without stably employed parents.

Poverty rates declined for all racial and ethnic subgroups we examined, but substantial gaps remain: Black and Hispanic children are more likely to experience poverty than White and Asian/Hawaiian/Pacific Islander children. The size of these gaps went unchanged from 1993 to 2019. Likewise, while disparities in poverty between children in immigrant families and those in non-immigrant families decreased from 16.2 percentage points in 1993 to 6.6 percentage points in 2019, children in immigrant families remain about 1.7 times as likely to be in poverty as children with only U.S.-born parents. Meanwhile, disparities in both poverty and deep poverty rates have increased over time between children with and without stably employed parents.

With the persistence of these gaps as context, we also find that the social safety net, as currently designed, is maintaining and even exacerbating disparities in poverty rates between children in immigrant and non-immigrant families, between children with and without stably employed parents, between White and Asian/Hawaiian/Pacific Islander children, and between White and Hispanic children. As the U.S. population shifts toward a greater proportion of children of color and children living in immigrant families, our finding of an association between these demographic shifts and increases in child poverty raises important questions about who may access the labor market and social safety net programs.

Lesson 5. Declines in teen birth rates were associated with reductions in child deep poverty, but are unlikely to be associated with substantial further declines.

Teen birth rates declined dramatically from 1993 to 2019, by 72 percent. Holding everything else constant, the decrease in teen birth rates over the quarter-century period corresponds to 52 percent of the decrease in child deep poverty (but was not associated with the decrease in child poverty). Teen birth rates are currently at historic lows, and further declines are unlikely to be associated with pronounced reductions in child deep poverty. It’s important to remember that teen birth rates are a symptom of child poverty as well as a potential contributor to it, so causality is difficult to determine.

Lesson 6. Children in both single-parent families and multi-adult households would benefit from supports to maintain economic stability and stable environments.

Our analysis finds that increases in single mothers’ labor force participation and the share of children living in two-parent families are associated with reductions in child poverty.[1] Both of these findings point to a connection between family structure and the economic conditions in which a child lives. Additional adults in a household provide both economic and logistical supports that are beneficial for children. Policies that facilitate female labor force participation, protect multi-adult households, and support single-parent families (e.g., universal family leave, accessible and affordable high-quality child care, etc.)—and policies that more generally support the economic, social, and caregiving benefits that families bring to children—may help to continue the decline in poverty.

Section 2: Five policy recommendations to further reduce child poverty

Our nation’s collective work to protect children from poverty is not over. Based on these lessons, we present the following recommendations to federal, state, and local officials to maintain the nation’s progress in reducing child poverty and to reduce persistent disparities in child poverty. The first two recommendations address the social safety net, while the latter three address the economic and social constraints that place certain demographic groups at higher risk of experiencing child poverty.

Recommendation 1. Recraft social safety net programs to prioritize child needs and determine eligibility based on child needs, rather than parent characteristics.

The social safety net protects millions of children from poverty and is thus a critical investment in the healthy development and future of all our nation’s children. Our analysis shows both the incredible successes of the social safety net in safeguarding children and the places where it has left gaps: Current policies exclude children from the full benefits of the social safety net by setting eligibility criteria based on their parents’ characteristics, such as work status and immigration status. In contrast, a social safety net designed to alleviate child poverty would be intentionally more inclusive by centering children’s needs, and by eliminating requirements based on other parent characteristics.

Recraft program eligibility requirements to be based on children's need rather than their parents.

The 2021 Child Tax Credit (CTC) and Advance Child Tax Credit represent examples of programs based on children’s needs, in two ways. First, the very premise of the 2021 expansion of the CTC was based on research that shows the importance of economic stability for child well-being and the value of investing in the early childhood years (a period of intensive brain development). The Advance CTC provided families with children predictable monthly payments of up to $250 per child for children ages 6 to 17, and up to $300 per child under age 6. Second, its eligibility requirements were based on the child’s citizenship status, not that of the parent.

By contrast, the EITC requires a completed tax return and a Social Security number for everyone claimed on a family’s taxes. Our analysis found that the EITC is one of the most significant and effective anti-poverty programs we’ve got; however, children who are U.S. citizens and have parents with Individual Taxpayer Identification Numbers,[2], rather than Social Security numbers, cannot benefit from the program. Recrafting eligibility to direct resources to children experiencing economic hardship—and removing eligibility requirements that limit benefits based on immigration status and other characteristics—would support continued reductions in child poverty and improvements in the health and well-being of our nation’s children.

Recommendation 2. Ease administrative barriers to the social safety net for eligible families to reduce child poverty and deep poverty, and to mitigate disparities between subgroups of children

Our research shows that access to multiple programs and supports—not just one—is often needed to lift children out of deep poverty, in particular. However, program requirements across social safety net programs vary widely with respect to income thresholds, application and documentation requirements (e.g., proof of residence), recertification processes, and other eligibility requirements and details. The result is a complex web of administrative barriers that is both difficult and time-consuming for parents to navigate. Application, documentation, and recertification procedures should be simplified and streamlined to make it easier for every family who qualifies for a program to access its benefits. To facilitate cross-program access, state and federal agencies should broaden categorical eligibility (that is, when eligibility for one program is sufficient to determine eligibility for another), automated enrollment processes, and outreach campaigns. When families in deep poverty qualify for four programs, we should not require them to fill out four applications, negotiate with four different agencies, and maintain certification of eligibility in each program in order to continue receiving needed benefits.

The United States has learned how to reduce administrative barriers during the COVID-19 pandemic—lessons that could be applied to programs operating in broader contexts, beyond emergency situations. For example, Pandemic Electronic Benefit Transfers (P-EBT) provided children already eligible for free or reduced-price lunches with benefits under SNAP. While states had to develop new policies and infrastructure to make the program work, P-EBT was largely successful in reducing food insecurity and supporting children in immigrant families. Implementation of the expanded CTC taught us about innovative alternative reach and delivery systems, including online portals for families that do not file taxes, alternatives to direct deposit for families that do not use banks, and outreach campaigns. By the most conservative estimates, more than one in five eligible families don’t receive the EITC. Continued reforms, such as automatic enrollment, would go a long way toward ensuring that tax and transfer programs reach all families they were intended to reach.

Recommendation 3. Support stable parental employment and more robust female labor force participation with fair labor markets, higher minimum wages, and affordable, accessible child care.

The benefits of a strong U.S. economy do not currently fully extend to children in families living in poverty. Our findings highlight persistently high rates of poverty among subgroups that face systemic barriers to accessing and maintaining stable employment. We recommend removing common barriers that prevent low-income families from accessing and maintaining employment that is both dependable and that allows families to support themselves. These barriers include lack of access to affordable and high-quality child care and transportation, neighborhoods with limited resources and opportunities, discrimination, inadequate pay, a lack of workplace accommodations for disabled parents, a lack of paid sick and family leave, discrimination against formerly incarcerated parents, and difficulties obtaining work authorization for immigrant parents.

Removing barriers to stable employment and increasing low wages may be critical strategies to reduce the persistent gaps in child poverty by race and ethnicity. Hispanic men, for example, have greater rates of labor force participation than men from other racial and ethnic groups, but Hispanic fathers often have low incomes, making it difficult for them to lift their children and families out of poverty. Meanwhile, research indicates that providing access to high-quality child care, addressing workplace discrimination, and reducing wage inequality are effective strategies for enabling female workers to easily participate in the workforce.

In addition to removing barriers to employment, it will be critical to ensure that work is sufficient to lift families out of poverty. Our analyses show that increases in state minimum wages were associated with reductions in child poverty. Higher minimum wages could further support families’ ability to maintain stable employment and support their children. In addition, reducing the phase-in period for the EITC could maximize the benefit for working families with the lowest incomes, whose wages alone are currently too low to support their families.

Promote fair labor markets, higher minimum wages, and affordable child care.

Recommendation 4. Maintain low teen birth rates by increasing public investment in evidence-based teen pregnancy prevention strategies and safeguarding adolescents’ access to safe abortion.

The dramatic reduction in teen births from 1993 to 2019 was associated with the decline in child deep poverty over this time. Researchers have attributed declines in the teen birth rate to less teen sex and more contraceptive use; these factors, in turn, may have been due to media and messaging campaignsavailability of effective contraceptive methods, and pregnancy prevention programs. As of mid-2022, teen birth rates remain at historic lows, meaning that further reductions in teen births may be less dramatic and result in less pronounced reductions in child deep poverty.

In 2022, a momentous Supreme Court ruling—Dobbs v. Jackson Women’s Health Organization—overturned the legal precedent established by the 1973 Roe v. Wade court case, granting states broad flexibility to impose restrictions on abortion. Restricting adolescents’ access to abortion may slow or reverse recent teen birth trends, and, by extension, have a detrimental influence on child deep poverty. In recent years, teen pregnancy rates, adolescent abortion rates, and the proportion of all abortions completed by adolescents have declined. Still, as of 2019, adolescents ages 15 to 19 accounted for 9 percent of all abortions nationally (an estimated 53,049 abortions). And our analysis found that declines in teen births were associated with 52 percent of the decline in deep poverty rates for children from 1993 to 2019.

To prevent teen birth rates from rising, policymakers should work to ensure that adolescents have safe access to abortion, contraception, and evidence-based teen pregnancy prevention programs. This would likely safeguard recent reductions in child deep poverty.

Recommendation 5. Promote the economic, social, and caregiving benefits that families bring to children and their parents, and reform policies that undermine their role in children’s lives.

Drawing on our finding that the proportion of children in two-parent families is strongly associated with child poverty, we recommend that public officials promote and safeguard the benefits that families—including parents, partners, and extended family—can provide to children, and particularly those assets that the presence of a second parent or caregiver typically bring. Such benefits include economic resources and logistical, emotional, and caregiving support, among others. Other policies that support families—such as paid family leave and flexible work scheduling—can provide adults with greater opportunities and resources to support the children and parents in their lives.

Furthermore, public officials should carefully reform policies and institutions that undermine the consistent presence of stable caregivers in the lives of children, and especially those that undermine the role and presence of fathers. In 2020, nearly 7 percent of children and youth had a parent serve time in jail. Child welfare agencies also have a powerful influence over family stability and the presence of parents in children’s lives: Previous research has found that economic insecurity can increase a family’s chance of coming into contact with the child welfare system, and nearly all states’ definitions of neglect include a factor linked to low incomes such as inadequate food, clothing, or shelter. This connection between poverty and neglect can lead to the surveillance of families with fewer resources and the separation of children from their families.

Earlier in this chapter, we noted that increases in the share of children living in two-parent families were strongly associated with child poverty. We recommend caution to readers in interpreting this finding. We specifically recommend caution in developing policy interventions that directly encourage parents to maintain or create two-parent households. Incentives to marry or otherwise maintain two-parent households could have the effect of directing resources away from children in single- or no-parent households; according to our analysis, these households need resources the most. Such incentives could also trap families who are experiencing domestic violence. A narrow focus on two-parent households may also miss opportunities. Research illustrates the role of extended family—for example, Black grandparents living with their grandchildren—in supporting children and parents.

Chapter 6 Endnotes

[1] Readers should use caution when using our findings regarding two-parent households: Our analysis does not account for the many reasons why children live in single-parent households (e.g., domestic violence), nor does it account for the presence of other caring adults (e.g., grandparents) in the household.

[2] An Individual Taxpayer Identification Number (ITIN) is a tax processing number issued by the Internal Revenue Service to individuals who are required to have a U.S. taxpayer identification number but who do not have, and are not eligible to obtain, a Social Security number (SSN).