Public Assets Institute > Policy Areas > Family Economic Security > Vermont poverty and income took a step in the right direction

Vermont poverty and income took a step in the right direction

Household income went up and poverty went down in Vermont in 2015, mirroring the improvements at the national level that the U.S. Census reported on Tuesday.

The new American Community Survey data from the Census show median household income in Vermont was $56,990 last year. After adjusting for inflation, that represented an increase of nearly $2,800, or 5.1 percent. Vermont’s median household income in 2015 was about $1,200 higher than the national median household income, but the percentage increase was the same.

Also mirroring the national figures, Vermont saw encouraging income gains for lower income households. Average income for the bottom 20 percent of Vermont households increased 8.5 percent last year. That was a bigger percentage increase than the top 20 percent of households, but it’s important to look beyond percentages. Average income for the lowest 20 percent of households was just $14,203 last year. That was less than the poverty threshold for a two-person household.

While the new Census data show a significant improvement after years of income stagnation for many Vermonters, the increase reported for 2015 is only a good first step. Even with the 5 percent rise, median household income last year was still below the level in 2007, before the start of the Great Recession, after adjusting for inflation. And real median household income—that is, adjusted for inflation—was only a few hundred dollars higher in 2015 than it had been in 2001.

There was also good news on the poverty front for a change. Total poverty in Vermont dropped to 10.2 percent in 2015 from 12.2 percent the year before. That was the first time the poverty rate went below 11.0 percent since 2008. The poverty rate for those 65 and older was the lowest in more than a decade.

There were big improvements for children, too. The number of children in poverty went down by more than 3,300—a decrease of nearly 18 percent. The poverty rate among children fell to 13.3 percent in 2015 from 15.8 the previous year.

As with income, there is still work to be done on poverty in Vermont. Nearly half of single mothers with young children still live in poverty. More than 15,000 Vermont children live in poverty, and the rate continues to be higher for people of color—more than double what it is for whites.

The impact of poverty on children matters. The achievement gap between low-income students and their peers is well-documented. Schools will continue to face increased costs and struggle to close the achievement gap as long as there are children in poverty.

The new Census data are encouraging and show two important indicators moving in the right direction. Now Vermont should set its sights on another year of rising incomes for all Vermonters and a further drop in the poverty rate.

Posted by Jack Hoffman on September 15, 2016 at 4:23 pm

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