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Where Will Poverty Go From Here?

As our analysis of the new poverty data for 2009 points out, poverty may be even higher in 2010 and 2011 than in 2009.

The main reason is that forecasters are predicting continued weakness in the employment market, with the annual unemployment rate rising from 9.3 percent in 2009 to at least 9.5 percent in 2010 and declining only slightly to 9.0 percent or higher in 2011. Moreover, in the last three recessions, the poverty rate didn’t begin falling until a year after the annual unemployment rate started to fall — which means poverty remained elevated for several years, as the graph shows.


Also, while unemployment insurance kept millions of Americans out of poverty in 2009 (and presumably will do so in 2010 as well), it will be less effective against poverty in 2011 if Congress allows the extra weeks of benefits for the long-term unemployed to expire this November.