Experiencing poverty during childhood can lead to lasting harmful effects that compromise not only children’s health and welfare but can also hinder future opportunities for economic mobility, which may be passed on to future generations. An intergenerational cycle of economic disadvantages weighs heavily not only on children and families experiencing poverty but also on the nation as a whole by reducing future national prosperity and increasing burden on the educational, criminal justice, and health care systems.
Reducing Intergenerational Poverty examines the drivers of long-term, intergenerational poverty, identifies potential policies and programs to reduce it, and recommends actions to address gaps in data and research. Understanding the causes of intergenerational poverty and implementing programs and policies to reduce it would yield a high payoff for disadvantaged children and for the entire nation.
The report defines intergenerational poverty as a situation in which children who grow up in families with incomes below the poverty line are themselves poor as adults.
Over the past decade, an average of approximately 10 million U.S. children lived in families with incomes below the poverty line.
Among U.S. children born around 1980 who grew up in families with incomes below or near the poverty line, 34 percent of also had low household incomes in adulthood.
This is twice the 17 percent rate found among adults born at the same time who did not grow up in low-income households.
Intergenerational economic disadvantage disproportionately affects Black and Native American families. Intergenerational persistence in low-income families is relatively similar for White and Latino children, lower for Asian children, and much higher for Black and Native American children.
Close to half (46%) of Native American children and over one-third (37%) of Black children who grew up in low-income families had low incomes in adulthood. Only 17 percent of Asian children living in households with incomes below or near the poverty line were poor in adulthood, compared with 29 percent of poor White children and 25 percent of Latino children.
Despite the higher rates of low-income persistence among Black and Native American children, the largest share (40%) of persistently low-income children is White. More than one-third are (34%) Black, 19 percent are Latino, and Native American and Asian children account for 2 percent each.
Racial and ethnic disparities are also an enduring feature of the intergenerational trajectories of children. Black and Native American children experience much less upward mobility than White children growing up in the same economic circumstance. Intergenerational mobility is less, on average, for Black than White children even when they grow up in the same neighborhoods.
One can think of economic status as rungs on a 100-step ladder, with the lowest rungs corresponding to the lowest incomes, the highest rungs representing the highest incomes, and each individual rung representing one percentile of the income distribution. On average, White children who grew up in low-income families—with incomes on the 10th rung of the ladder in the 1980s and 1990s—were able to climb their way to the 41st rung by the time they were in their 30s. Asian children rose higher up the ladder (53rd rung) than White children, while Latino children did only slightly worse (39th rung) than White children.
Key drivers of intergenerational poverty influence the developmental trajectories of children living in households below the poverty line. Contemporary and historical disparities, discrimination, structural racism, as well as behaviors and choices, create further challenges for Black and Native American families in establishing economic security for their children.
Children’s education
Education can play a powerful role in undoing intergenerational poverty, promoting the development of the knowledge and skills that will allow children to be successful in the labor market. Large gaps in school achievement and completed schooling persist across racial and ethnic subgroups.
RACIAL DISPARITIES IN THIS DOMAIN Despite decades of improving educational outcomes among Black and Native American individuals, achievement and attainment gaps remain. Forced assimilation, an absence of culturally relevant instruction, school segregation by race and class, and disproportionate punishment create learning environments that do not foster educational achievement and attainment.
Child and maternal health
Children in low-income families have worse health than other children, a gap that begins before birth and increases as children grow older. Many families with low incomes are still without health insurance coverage or access to family planning services, and low-income children are more likely to be exposed to pollution.
RACIAL DISPARITIES IN THIS DOMAIN Black and Native children continue to experience worse health than their White counterparts and are subject to a history of unethical medical experimentation, contemporary implicit bias among health care professionals, high uninsurance rates among Native American individuals, and greater exposure to chronic stress, racism, and environmental toxins.
Family income, wealth, and parental employment
Low wages, earnings, and income among low-income families risk perpetuating the cycle of economic disadvantage.
RACIAL DISPARITIES IN THIS DOMAIN Black workers continue to have lower average earnings, face less predictable work hours and less stable employment, and reside disproportionately in states where the relatively low federal minimum wage is binding. Some of this can be attributed to lower educational achievement and attainment, lower labor force participation rates, and racial discrimination.
Family structure
Over the past 50 years, single-parent families have become much more common. There is strong association between growing up in a single-parent family and childhood poverty.
RACIAL DISPARITIES IN THIS DOMAIN Family structures differ markedly by race/ethnicity and education levels. The largest proportions of children living with both married parents could be found among Asian children, followed by White and Hispanic children, while the fewest number proportion of children living with both married parents was Black children.
Housing and neighborhood environments
The places where children live serve as the foundation for their health, education, and development. Consistent evidence shows that intergenerational poverty is linked with high lead levels, homelessness, overcrowding, moving frequently, and high housing costs in childhood.
RACIAL DISPARITIES IN THIS DOMAIN Rates of intergenerational poverty vary widely across residential locations but are consistently higher, on average, for Black than White children even when they live in the same neighborhoods. Contributing factors include risks of high lead levels, homelessness, overcrowding, moving frequently, and high housing costs relative to income in childhood.
Neighborhood crime and the criminal justice system
Low-income and younger people are most likely to report being victims of crime in their neighborhoods and schools. Incarceration rates disproportionately affect children in families with low incomes.
RACIAL DISPARITIES IN THIS DOMAIN Black and Native American youth experience disproportionate punishment in the juvenile justice system. Community violence poses a significant risk to health and well-being for Black, Native American, and low-income communities, while disproportionate system involvement and incarceration negatively affect young people’s later employment and earnings.
Child maltreatment
Income and poverty are highly correlated with child maltreatment and child welfare system involvement. Children who experience abuse, neglect, and/or involvement with child welfare systems are at elevated risk of intergenerational poverty.
RACIAL DISPARITIES IN THIS DOMAIN Black and Native American children have the highest rates of child maltreatment and are more likely to be referred to child welfare services.
Implementing a portfolio of policies and programs directed at children living in poverty can be instrumental in reducing those children’s chances of being poor when they become adults. In examining policies and programs, the committee considered the strength of the research and evaluation evidence; magnitude of impacts relative to costs; and possible behavioral responses to policies and programs.
Program and Policy Ideas Linked by Direct Evidence to Reductions in Intergenerational Poverty
The report found direct evidence of success in reducing intergenerational poverty in policies and programs for five of the seven key drivers: education, child and maternal health; family income, employment, and wealth; housing and neighborhoods; and neighborhood crime and the criminal justice system. Programs and policies for which the supporting evidence was particularly strong are marked with an .
K-12 education |
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Post-secondary education |
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Career training |
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Family Planning |
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Health Insurance |
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Pollution reduction |
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Nutrition |
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Work-based income support |
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Residential mobility |
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Juvenile incarceration |
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Child investment strategies |
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Strengthen communities to reduce violent crime and victimization |
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Policing strategies |
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Gun safety |
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While the committee was able to identify a number of programs and policies that appeared to be effective in reducing intergenerational poverty, it lacked high-quality evidence on the intergenerational impacts of many other promising programs.
Existing census, survey, and administrative data—linked for families over time and across subject domains, including income, wealth, demographics, health, and education, and with appropriate confidentiality protection—would be invaluable for promoting needed policy research on intergenerational mobility.
Specifically, the committee recommends that the Chief Statistician at the Office of Management and Budget facilitate research on economic opportunity, intergenerational poverty, and related topics by changing provisions for secure access to confidential data from the Internal Revenue Service, Census Bureau and certain state benefit program records for policy evaluation research.