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A profile of the working poor, 2021

In 2021, 37.9 million people, or 11.6 percent of the nation’s population, lived below the official poverty level, according to the U.S. Census Bureau.[1] (See the technical notes section for examples of poverty levels.) Although the poor were primarily adults who had not participated in the labor force during the year and children, 6.4 million individuals were among the “working poor” in 2021, according to data from the Bureau of Labor Statistics (BLS); this measure was essentially unchanged from 2020. The working poor are people who spent at least 27 weeks in the labor force (that is, working or looking for work) but whose incomes still fell below the official poverty level. In 2021, the working-poor rate—the ratio of the working poor to all individuals in the labor force for at least 27 weeks—was 4.1 percent, unchanged from the previous year’s figure. (See table A, chart 1, and table 1.)

Highlights from the 2021 data

• The working-poor rate of people in the labor force for 27 weeks or more was 4.1 percent, unchanged from a year earlier. (See chart 1.)

• Full-time workers remained much less likely to be among the working poor than part-time workers. Among people in the labor force for 27 weeks or more, 2.6 percent of those usually employed full time were classified as working poor, compared with 10.1 percent of part-time workers. (See table 1.)

• Women were more likely than men to be among the working poor (4.5 percent and 3.7 percent, respectively). In addition, Hispanics or Latinos (7.3 percent) and Blacks or African Americans (6.4 percent) continued to be much more likely than Whites (3.6 percent) and Asians (2.7 percent) to be among the working poor.² (See table 2.)

• The likelihood of being classified as working poor diminishes as workers attain higher levels of education. Among those with less than a high school diploma, 12.7 percent of those who were in the labor force for at least 27 weeks were classified as working poor, compared with 1.3 percent of those with a bachelor’s degree and higher. (See table 3.)

• Individuals who were employed in service occupations remained more likely to be among the working poor than those employed in other major occupational groups. (See table 4.)

• Among families with at least one member in the labor force for 27 weeks or more, those with children under 18 years old (7.6 percent) were nearly four times as likely as those without children (2.0 percent) to live in poverty. Families maintained by women (12.7 percent) were more likely to be living below the poverty level than families maintained by men (7.1 percent). (See table 5.)

  View Chart Data

  Chart. 1 Working-poor rate of people in the labor force for 27 weeks or more, 1986–2021

  Year	Total
  1986	6.2
  1987	5.5
  1988	5.4
  1989	5.3
  1990	5.5
  1991	6.1
  1992	6.3
  1993	6.7
  1994	6.2
  1995	5.9
  1996	5.8
  1997	5.7
  1998	5.4
  1999	5.1
  2000	4.7
  2001	4.9
  2002	5.3
  2003	5.3
  2004	5.6
  2005	5.4
  2006	5.1
  2007	5.1
  2008	6.0
  2009	7.0
  2010	7.2
  2011	7.0
  2012	7.1
  2013	7.0
  2014	6.3
  2015	5.6
  2016	4.9
  2017	4.5
  2018	4.5
  2019	4.0
  2020	4.1
  2021	4.1
  Note: Estimates for 2020 and forward incorporate new population controls reflecting Census 2020 results and are not strictly comparable with data for earlier years. Source: U.S. Bureau of Labor Statistics, Annual Social and Economic Supplement (ASEC) of the Current Population Survey (CPS).

This report presents data on the relationship between labor force activity and poverty status in 2021 for workers and their families. These data were collected in the 2022 Annual Social and Economic Supplement to the Current Population Survey. (For a detailed description of the source of the data and an explanation of the concepts and definitions used in the report, see the technical notes.) The specific income thresholds used to determine people’s poverty status vary depending on whether the individual is living with family members, living alone, or living with nonrelatives. For people living with family members, the poverty threshold is determined by the family’s total income; for an individual not living with family members, personal income is used as the determinant.

Demographic characteristics

Among those who were in the labor force for 27 weeks or more in 2021, the number of women classified as working poor (3.3 million) was little different than that of men (3.1 million). However, the working-poor rate continued to be higher for women (4.5 percent) than for men (3.7 percent); the rate for men was unchanged from a year earlier, while the rate for women was little different. (See table 2.)

Hispanics and Blacks were much more likely than Whites and Asians to be among the working poor. In 2021, the working-poor rates for Hispanics and Blacks were 7.3 percent and 6.4 percent, respectively, compared with 3.6 percent for Whites and 2.7 percent for Asians. (See table 2 and chart 2.)

In 2021, the working-poor rates among Whites and Blacks were higher for women than for men. The rates for White women and White men who spent at least 27 weeks in the labor force were 3.9 percent and 3.4 percent, respectively. The rate for Black women was 7.7 percent, compared with 4.9 percent for Black men. The rate for Hispanic women, at 7.6 percent, was little different from that of Hispanic men at 7.0 percent. The working-poor rate for Asian women was 2.7 percent, nearly identical to the rate for men (2.8 percent). (See table 2.)

Young workers—those ages 16 to 24—tend to have higher working-poor rates than workers in older age groups, in part because earnings are lower and the unemployment rate is higher for young workers. Among youths who were in the labor force for 27 weeks or more, 6.4 percent of 16- to 19-year-olds and 7.2 percent of 20- to 24-year-olds had incomes that fell below the official poverty level in 2021. Those rates were higher than the rates for workers ages 25 to 34 (4.9 percent) and those ages 35 to 44 (4.4 percent). Workers ages 45 to 54, 55 to 64, and 65 and older had lower working-poor rates—3.1 percent, 2.7 percent, and 1.8 percent, respectively—than those in younger age groups. (See table 2.)

Educational attainment

Achieving higher levels of education reduces the incidence of living in poverty. People with more years of education usually have greater access to higher paying jobs—such as management, professional, and related occupations—than those with fewer years of education. Among people in the labor force for 27 weeks or more in 2021, those with less than a high school diploma had the highest working-poor rate at 12.7 percent, almost 10 times higher than the rate for those with at least a bachelor’s degree and higher (1.3 percent). Among those with fewer years of education, the working-poor rate for those with 4 years of high school (no diploma) was 9.4 percent in 2021; however, they experienced the largest over-the-year decrease (4.2 percentage points) among groups by educational attainment.

By sex, women were more likely than men to be among the working poor for high school graduates and for those with some college or associate’s degree. However, the working-poor rates were little different for men and women with a bachelor’s degree and higher (1.2 percent and 1.4 percent, respectively) and for men and women with less than a high school diploma (11.5 percent and 14.8 percent, respectively). (See table 3 and chart 3.)

For people with less than a high school diploma, the working-poor rates among Whites (11.8 percent), Blacks (15.4 percent), Asians (10.6 percent), and Hispanics (14.6 percent) were little different in 2021. For those with a bachelor’s degree and higher, all race and ethnicity groups had similar working-poor rates, ranging from 1.2 percent to 2.6 percent.

Occupation

The likelihood of being among the working poor varies widely by occupation. Workers in occupations requiring higher education and characterized by relatively high earnings—such as management, professional, and related occupations—were least likely to be classified as working poor. For example, 1.4 percent of those in management, professional, and related occupations were among the working poor in 2021. By contrast, individuals employed in occupations that typically do not require high levels of education and that are characterized by relatively low earnings were more likely to be among the working poor. For instance, 8.4 percent of workers in service occupations who were in the labor force for at least 27 weeks were classified as working poor in 2021. The 2.0 million working poor employed in service occupations accounted for about one-third of all those classified as working poor. (See table 4.)

For most occupational groups, women had higher working-poor rates than men. However, the rates for men and women were little different in management, professional, and related occupations (1.3 percent and 1.4 percent, respectively) and in natural resources, construction, and maintenance occupations (5.4 percent and 6.8 percent, respectively). Working-poor rates were the lowest for both men and women, in management, professional, and related occupations. The working-poor rate for women in service occupations was 10.0 percent while the rate for men was 6.4 percent.

Families

In 2021, 3.3 million families were living below the poverty level despite having at least one member in the labor force for half the year or more. This figure was essentially unchanged from 2020. Among families with only one member in the labor force for at least 27 weeks in 2021, married-couple families were less likely to be living below the poverty level, at 6.1 percent, than were families maintained by women, at 16.8 percent, and families maintained by men, at 10.1 percent. (See table 5.)

Among families with at least one member in the labor force for more than half the year, those with children in the household were much more likely, at 7.6 percent, to live below the poverty level than those without children at 2.0 percent. However, the working poor rate for those with children edged down by 0.3 percentage point over the year while the rate for those without children was little changed. Among families with children under 18, the working-poor rate for those maintained by women (18.4 percent) was higher than that for those maintained by men (10.3 percent). In 2021, the working-poor rate for families with children under 18 maintained by men increased by 1.9 percentage points over the year; while the rate for those maintained by women was little changed. For married-couple families with children under 18, the rate decreased by 0.5 percentage point to 3.9 percent.

Unrelated individuals

The “unrelated individuals” category includes individuals who live by themselves or with others not related to them. Of the 37.9 million unrelated individuals who were in the labor force for half the year or longer, 2.5 million lived below the poverty level in 2021. This measure was little changed from a year earlier. The working-poor rate for unrelated individuals who were in the labor force for 27 weeks or more was unchanged at 6.6 percent. (See table 7.)

Within the group of unrelated individuals, teenagers continued to be the most likely to be among the working poor. In 2021, 28.6 percent of teens (ages 16 to 19) who were in the labor force for 27 weeks or more and who lived on their own or with others not related to them lived below the poverty level, little changed from 2020. In 2021, the working-poor rates for men and women living alone or with nonrelatives were 6.4 percent and 6.9 percent, respectively. The rate for unrelated individuals was higher for Hispanics (9.7 percent) than for Blacks (6.8 percent), Whites (6.4 percent), and Asians (5.3 percent). (See table 7.)

Of the 2.5 million unrelated individuals considered to be among the working poor in 2021, about 3 out of 5 lived with others. These individuals had a higher working-poor rate (8.3 percent) than individuals who lived alone (4.9 percent). Many unrelated individuals living below the poverty level may live with others out of necessity. By contrast, many of those who live alone do so because they have sufficient income to support themselves. However, unrelated individuals’ poverty status is determined by each person’s resources. Therefore, the pooling of resources and sharing of living expenses may permit some individuals in this category—who are technically classified as poor—to live at a higher standard than they would have if they lived alone.

Labor market problems

As noted earlier, people who usually work full time are less likely to live in poverty than are those who work part time, yet there remains a sizable group of full-time workers who live below the poverty threshold. Among those who participated in the labor force for 27 weeks or more and usually worked in full-time wage and salary jobs, 2.9 million were classified as working poor in 2021—essentially unchanged from a year earlier. (See table 8.)

There are three major labor market problems that can hinder a worker’s ability to earn an income that is above the poverty threshold: low earnings, periods of unemployment, and involuntary part-time employment. (See the technical notes section for detailed definitions.)

In 2021, 83 percent of the working poor who usually work full time experienced at least one of the major labor market problems. Among all full-time wage and salary workers who were in the labor force for at least 27 weeks, low earnings continued to be the most common problem, with 66 percent subject to low earnings, either as the only problem or in combination with other labor market problems. Thirty-two percent experienced unemployment as the main labor market problem or in conjunction with other problems, a decrease of 11.0 percentage points from the prior year. In 2021, 2.4 percent of the working poor experienced all three problems: low earnings, unemployment, and involuntary part-time employment; less than half of the rate who experienced these problems in 2020. (See table 8.)

In 2021, 490,000, or 17 percent, of the working poor who usually worked full time did not experience any of the three primary labor market problems, essentially unchanged from 2020. Their classification as working poor may be explained by other factors, including short-term employment, some weeks of voluntary part-time work, or a family structure that increases the risk of poverty.