Will Poverty, Income, and Health Insurance Coverage Improve Significantly in 2004?
Publication Date: August 2004
Special Collection: John D. and Catherine T. MacArthur Foundation
Keywords: Economic projections; Income diversity; Economic inequality; Health insurance
The new Census Bureau report released yesterday showed that poverty increased, health insurance coverage eroded, and median incomes stagnated in 2003. Some who have attempted to downplay the new Census figures have argued that the figures are already out of date and conditions have improved significantly in 2004. As USA Today put it, “The White House said the report was old news.”
While it is difficult at this point to predict outcomes for 2004 with any certainty, this analysis finds that health insurance coverage is likely continuing to erode this year.
Predictions about trends in poverty and median income in 2004 are more difficult to make. The relevant indicators here are mixed. Economic growth has been stronger in 2004 than in 2003, the unemployment rate has fallen, and there has been modest job creation. On the other hand, the share of the population holding jobs has not improved, and average weekly wages have dropped slightly, with the wage declines being greatest among low-paid workers. In addition, the safety net for the unemployed has weakened with the termination of the temporary federal unemployment benefits program at the end of 2003.
So while one normally would expect poverty to decline and income to rise at this stage of the economic cycle — after all, 2004 marks the third full year of recovery from an economic downturn — current prospects in these areas are unclear. The mixed nature of the data just cited suggests that any improvements in 2004 are likely to be modest.
This analysis also discusses an error made by some who are indicating that the 2004 data will be much better.