Unemployment Versus Poverty

In the ZIP code demographics thread, DivGuy noticed something that I wondered about, too: "The thing that struck me is the huge gap between the '% unemployed' and the '% below poverty line.'"

Thinking about this, a few factors occurred to me over and above the obviously real phenomenon of people who have full-time jobs and still find themselves below the poverty line. Basically, children and retired people aren't counted in the unemployment rate but they can be poor. Indeed, in my neighborhood -- like many other gentrifying neighborhoods around the country -- the children are overwhelmingly concentrated in the more economically downscale households.

Comments

The student-filled ZIP I live in, 78705, has 6.2% unemployment and a 50% poverty rate. I think this just means that poverty is being calculated in a rather crude fashion.

Posted by Neil the Ethical Werewolf | October 7, 2007 3:41 PM

The thing I noticed is that there's a zip code in Kansas City MO where the median age is 12! (Click the Median Age (Lowest) button.) What's up with that?

Posted by live | October 7, 2007 4:23 PM

On second thought, I can kind of see it. Also, there's a zip in SC where the median age is 85, which seems even odder. I guess some of these zips don't have huge populations to start with.

Posted by live | October 7, 2007 4:26 PM

There can be huge differences between the unemployment rate and the employment rate if lots of people have given up looking for work, as is common among African-American men.

Posted by Steve Sailer | October 7, 2007 5:42 PM

Neil's right - students count as below the poverty line. I looked at my ZIP and it has a huge "poverty rate" - and guess what, it's all college kids with nice cars.

Steve Sailer is also right when he says the unemployment rate undercounts by not counting "discouraged workers"...though he didn't need to bring race into it.

Posted by Mr. Noah | October 7, 2007 6:07 PM

Steve Sailer is also right when he says the unemployment rate undercounts by not counting "discouraged workers"...though he didn't need to bring race into it.

But it may also over-count by failing to count people working off the books. People who are poor (or on disability) often do this to avoid losing their benefits. We really do need an in-depth study of all such exceptions (both ways) so we can figure out a good way to norm the unemployment rate.

Posted by JonF | October 7, 2007 7:35 PM

Here are some stats on employment rates from economist George Borjas of Harvard, looking at 1960 vs. 2000 (the latter being a year with a very low unemployment rate):

"The employment rate of black men in the United States fell precipitously from 89.6 percent in 1960 to 76.1 percent in 2000…

"… the employment rate of black high school dropouts fell by 33 percentage points, from 88.6 to 55.7 percent, as compared to an 18 percentage point drop for white high school dropouts, from 94.1 to 76.0 percent."

Posted by Steve Sailer | October 7, 2007 8:55 PM

Nice zip code site. But why not go to the source? You can get more stats of state county and city data. I don't have time now, but if you follow links you can get zip and census block data comparable to that on the zip code page, actually much more than they have.

http://www.census.gov/
Look for
"Find An Area Profile with QuickFacts"

On the lower right corner.

Not sure if links to zip and census block data are in that section. I think there is another 'american fact finder' feature that gives zip and census block data.

Looks like your zip page went to census bureau and just downloaded what they thought were the most interesting fields.

Posted by census bureau has more | October 7, 2007 9:23 PM

I can tell from my zip (in the heart of Wisconsin's student housing areas), that at least some of that difference is probably students.

Posted by JWill | October 7, 2007 11:57 PM

Are illegal aliens counted in the unemployment rate? Presumably they are not, as they cannot legally work. But they can certainly be poor.

Posted by Bloix | October 8, 2007 12:09 AM

I think most organizations in the US figure unemployment rate based on people collecting unemployment. Since an awful lot of people who are unemployed are not eligible for unemployment, that statistic is traditionally vastly undercounted in the US.

Of course, this also means that a lot of people with partial employment situations are not mentioned in any unemployment statistics.

Posted by JMitz | October 8, 2007 1:21 AM

Would like to talk to someone about my unemploymnt wages. a.s.a.p

Posted by Tanisha Henry | October 8, 2007 10:46 AM

Live @4:26, my guess is that the zip you found is a retirement community. My grandparents live in one in SC now.

Posted by dbt | October 8, 2007 12:03 PM

Re: I think most organizations in the US figure unemployment rate based on people collecting unemployment.

No, no one counts unemployment that way. The official figures derive from a phone survey in which respondents are asked if they are employed (working as little as one hour a week counts as employed) and if they are bot, are they looking for work. Anyone answering No to the first question and Yes to the second is counted as unemployed.
In principle illegal aliens would also be counted in this survey, except that many of them may not have phones, they may not be willing to answer and I am not sure if the survey is conducted in languages other than English.

Posted by JonF | October 8, 2007 10:00 PM