There’s more to consider than just a family’s income when it comes to measuring poverty and its impact on a child’s well-being, a new study finds. The report by Child Trends Center, a non-profit research organization, is the first to examine the impact of geographic variations and cost of living on child outcomes.
“Not only is income important,” said the study’s co-author Nina Chien, “but income in context of where the family lives.”
The current federal poverty guidelines do not consider cost of living variations, assuming that a dollar in San Francisco buys the same goods and services in rural Nebraska. The Child Trends Center study says this gap is hindering poor families’ ability to receive the aid they need, like food stamps, State Children’s Health Insurance and other government assistance programs.
Another study estimated that within a sample of 98 cities, if costs of living were considered, eligibility for Head Start would increase by 227,000 families and eligibility for the National Lunch Program would increase by half a million.
“There may be low-income families living in high-cost areas and are not eligible for aid,” Chien said, “but in fact they may need it because they have little income left over after rent.”
Cost of living varies drastically across the United States. One month of rent for a modest two-bedroom apartment averages $3,000 in San Francisco and $500 in Frontier County, Nebraska. A family of four with an income of $35,000 living in San Francisco has more financial challenges compared to a family in Frontier County.
Living in a high-cost state does not necessarily mean more benefits are available either. California, for example, does not have a state Earned Income Tax Credit, a refundable tax credit for low to medium-income parents. Existing subsidies are also difficult to access. Section 8 public housing programs in many metropolitan areas have wait lists that are several years long or closed. The wait list for Los Angeles County has been closed since 2009. And only about one-third of families eligible for childcare subsidies currently receive them.
The study also found that living in a higher-cost area was related to lower school resources for poor families, but to higher school resources for moderate-income families. This suggests that in higher-cost areas, schools are economically segregated.
Chien said this report demonstrates how cost of living intersects with income in meaningful ways for child well-being and should be considering for measuring poverty and providing much needed aid. “If more assistance can be directed to those resources,” she said, “the playing field would be more level between living in high-cost and low-cost areas.”