Poverty and food insecurity rebounding after expiration of federal aid

First published in NH Bulletin, March 29, 2024; also republished in News From The States

With nearly 100,000 New Hampshire residents living in poverty, or approximately 1 out of every 14 in the state, recent inflation and the end of federal assistance related to the COVID-19 pandemic are impacting the ability of many Granite Staters to afford basic necessities, including food. For individuals and families with very low incomes, poverty and food insecurity are interrelated challenges that threaten long-term well-being, particularly for children.

Poverty, as officially defined and measured by the federal government, reflects very low income levels. The poverty threshold does not vary geographically within the contiguous 48 U.S. states but does change based on the size of a household and the age of the individuals in it. For example, in 2022, the federal poverty threshold was $15,225 annually for an individual under 65 years old, $23,556 for a family of three with one child, and $29,678 for a family of four with two children.

This definition of poverty is rooted in research from the 1950s and 1960s. Alternative measures of poverty use more recent data to reflect modern household budgets and regional variations in key costs, such as housing.

Based on 2024 cost-of-living estimates independently compiled by the Massachusetts Institute of Technology and the Economic Policy Institute, basic family budgeted expenses would range from about $87,500 to $131,200 for a household with two adults and two children, depending on the county in New Hampshire. Households with poverty-level incomes likely have far fewer resources than needed to meet these cost-of-living estimates.

Households in or near poverty are much more likely to be food insecure than those with higher incomes. The federal government defines household food insecurity as not having “access at all times to enough food for an active, healthy life for all household members.” The food insecurity rate is measured through a federal survey that asks U.S. residents questions focused on the limitations of resources available for food.

Research suggests food insecurity is associated with diminished adult and child health, mental health disorders, higher probability of common chronic diseases, and, among children, lower physical growth potential and problems with language development, school performance, and social interactions.

Food insecurity declined during the worst years of the pandemic, as did poverty, based on a key measure of poverty that accounts for tax credits. Adjusting for after-tax income incorporates key forms of federal pandemic-related aid, such as the enhanced child tax credit paid directly to families monthly. However, both after-tax poverty and food insecurity rose substantially nationwide between 2021 and 2022, after most temporary aid to households expired.

The expiration of that assistance coincided with rising inflation. The cost of food rose more than 25 percent in northeastern U.S. states between January 2019 and January 2024, faster than the nearly 20 percent increase for consumer goods overall. In the 2020-2022 period, an estimated 35,000 households in New Hampshire were food insecure; while 2023 data are not yet available, if New Hampshire followed the national trend, food insecurity has likely increased.

Residents in poverty are likely at the greatest risk of food insecurity. Compared to the state population’s overall poverty rate of 7.3 percent, the 2018-2022 average poverty rate in New Hampshire was substantially higher for adults who had not completed high school or had no formal education beyond a high school degree, as well as for those who were working part time or seasonally. Single-parent families had higher poverty rates as well, particularly families with single mothers of children under 5 years old; approximately 1 in every 4 families in this group were in poverty. Black Granite Staters experienced an estimated poverty rate more than twice that of the population overall, while Hispanic or Latino Granite Staters faced a poverty rate about twice as high, reflecting historic barriers to economic opportunities. About 30 percent of all residents in poverty in New Hampshire had some form of disability.

Even beyond those in poverty, Granite Staters faced difficulty paying bills. About 1 in 3 New Hampshire adults found affording usual household expenses was somewhat or very difficult in 2023. This figure was a substantial rise relative to most of 2020 and 2021, with monthly survey data indicating much of the increase occurred following the 2022 Russian invasion of Ukraine.

Poverty and food insecurity increased substantially during and following the Great Recession of 2007-2009, and both took many years to decline significantly. During the COVID-19 recession, poverty and food insecurity dropped, primarily because of robust federal assistance to households. As both food insecurity and poverty appear to be rebounding after that aid has expired, policymakers now have recent examples to inform targeted, effective policies to help ensure Granite Staters are less likely to face these hardships.

Learn more in the New Hampshire Fiscal Policy Institute’s most recent Issue Brief, Poverty and Food Insecurity in New Hampshire During and Following the COVID-19 Crisis.

Phil Sletten is the research director at the New Hampshire Fiscal Policy Institute, a nonprofit, independent policy research organization based in Concord and focused on the state budget, New Hampshire’s economy, and policies affecting Granite Staters, particularly those with low and moderate incomes.