The US child poverty rate fell by nearly half in 2021, largely thanks to enhanced child tax credits, new census data shows.
The child poverty rate fell to a low of 5.2% compared with 9.7% the year before.
Experts noted that increased child tax credits provided low-income families with much-needed resources during the Covid-19 pandemic.
“This is what policy success looks like,” Chuck Marr, vice-president of federal tax policy at the Center on Budget and Policy Priorities, told Insider. “This was a historic achievement to reduce child poverty by a record amount driven by the expansion of the child tax credit.”
The new data comes from the Supplemental Poverty Measure (SPM) statistic, a US Census Bureau measure that takes into account non-cash benefits, tax credits and cash assistance, all of which were made more available during 2021 than in previous years.
Those additional benefits are not measured in the Official Poverty Measure (OPM), which experts say is a major flaw in the system, CNN reported.
The current OPM for children is at 15.3%, creating one of the largest divergences from the SPM since 2009, when the SPM was created.
Overall, US child poverty levels have been falling for decades. Child poverty has fallen by 59% since 1993 with rates declining in all 50 states, the New York Times reported.
But there is concern that the drop in poverty seen last year will prove temporary, because tax credit enhancements were only available in 2021.
In March 2021, as part of the American Rescue Plan Act, child tax credits were enhanced for one year. Payments increased to $3,600 for children under six years old and $3,000 for each child between six and 17.
An extension of child tax credits failed to pass Congress, amid opposition from Republicans and the West Virginia Democratic senator Joe Manchin.
Child allowances were not included in the Democrat-led health, tax and climate bill that passed last month.
“We know how to fight poverty, and it’s not super complicated,” Elizabeth Lower-Basch, director of income and work supports at the Center for Law and Social Policy (Clasp), told CNN.
“It’s about giving people the resources they need to meet their and their families’ needs.”
