The ranks of America's poorest poor have climbed to a record high — 1 in 15 people — spread widely across metropolitan areas as the housing bust pushed many inner-city poor into suburbs and other outlying places and shrivelled jobs and income.
New census data paint a stark portrait of the nation's haves and have-nots at a time when unemployment remains persistently high. It comes a week before the government releases first-ever economic data that will show more Hispanics, elderly and working-age poor have fallen into poverty.
In all, the numbers underscore the breadth and scope by which the downturn has reached further into mainstream America.
"There now really is no unaffected group, except maybe the very top income earners," said Robert Moffitt, a professor of economics at Johns Hopkins University. "Recessions are supposed to be temporary, and when it's over, everything returns to where it was before. But the worry now is that the downturn — which will end eventually — will have long-lasting effects on families who lose jobs, become worse off and can't recover."
Traditional inner-city black ghettos are thinning out and changing, drawing in impoverished Hispanics who have low-wage jobs or are unemployed. Neighborhoods with poverty rates of at least 40 per cent are stretching over broader areas, increasing in suburbs at twice the rate of cities.
Once-booming Sun Belt metro areas are now seeing some of the biggest jumps in concentrated poverty.
Signs of a growing divide between rich and poor can be seen in places such as the upscale Miami suburb of Miami Shores, where nannies gather with their charges at a playground nestled between the township's sprawling golf course and soccer fields. The locale is a far cry from where many of them live.
One is Mariana Gripaldi, 36, an Argentinian who came to the U.S. about 10 years ago to escape her own country's economic crisis. She and her husband rent a two-bedroom apartment near Biscayne Bay in a middle-class neighbourhood at the north end of Miami Beach, far from the chic hotels and stores.
But Gripaldi said in the past two years, the neighbourhood has seen an increase in crime.
"The police come sometimes once or twice a night," she said in Spanish. "We are looking for a new place, but it's so expensive. My husband went to look at a place, and it was $1,500 for a two-bedroom, one bath. I don't like the changes, but I don't know if we can move."
About 20.5 million Americans, or 6.7 per cent of the U.S. population, make up the poorest poor, defined as those at 50 per cent or less of the official poverty level. Those living in deep poverty represent nearly half of the 46.2 million people scraping by below the poverty line. In 2010, the poorest poor meant an income of $5,570 or less for an individual and $11,157 for a family of four.
That 6.7 per cent share is the highest in the 35 years that the Census Bureau has maintained such records, surpassing previous highs in 2009 and 1993 of just over 6 per cent.
Broken down by states, 40 states and the District of Columbia had increases in the poorest poor since 2007, and none saw decreases. The District of Columbia ranked highest at 10.7 per cent, followed by Mississippi and New Mexico. Nevada had the biggest jump, rising from 4.6 per cent to 7 per cent.
Concentrated poverty also spread wider.
After declining during the 1990s economic boom, the proportion of poor people in large metropolitan areas who lived in high-poverty neighbourhoods jumped from 11.2 per cent in 2000 to 15.1 per cent last year, according to a Brookings Institution analysis released Thursday. Such geographically concentrated poverty in the U.S. is now at the highest since 1990, following a decade of high unemployment and rising energy costs.
Extreme poverty today continues to be prevalent in the industrial Midwest, including Detroit, Grand Rapids, Mich., and Akron, Ohio, due to a renewed decline in manufacturing. But the biggest growth in high-poverty areas is occurring in newer Sun Belt metro areas such as Las Vegas, Riverside, Calif., and Cape Coral, Fla., after the plummeting housing market wiped out home values and dried up construction jobs.
As a whole, the number of poor in the suburbs who lived in high-poverty neighbourhoods rose by 41 per cent since 2000, more than double the growth of such city neighbourhoods.