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Every Californian deserves to be able to meet their basic needs for housing, food, and other necessities. But millions of people in California struggle to make ends meet every day – including young people with jobs, for whom a job does not guarantee economic security.

Low pay and unstable work make it especially difficult for young adult Californians to make ends meet as they may be working part-time while going to school, just starting off their careers, or blocked from educational and workplace opportunities that lead to higher-paying jobs.

California’s young workers should not be left on their own to build economic security as they seek opportunities for good-paying jobs. California can build an inclusive state where generations of young people can live, work, and thrive across the state. Young workers need state leaders to implement policies that:

  • increase low wages
  • improve the quality of jobs
  • expand worker bargaining power
  • address workplace and other discrimination
  • invest in public supports that ensure young adults can meet their basic needs.

One way state leaders can support young workers is by ensuring they have access to tax credits such as the California Earned Income Tax Credit, or CalEITC, and by increasing the amount of cash provided through those tax credits.

For Young Adults Especially, a Job Does Not Guarantee Economic Security in California

Young adult Californians are especially unlikely to be able to meet their basic needs despite working, according to data from the California Poverty Measure. Among working Californians ages 18 to 24 (excluding college students living independently who are supported by their parents), about 1 in 5 do not have enough resources to afford basic needs – roughly twice the share of workers ages 25 to 64.1Budget Center analysis of US Census Bureau, American Community Survey public-use microdata developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Microdata used to construct the California Poverty Measure were downloaded from IPUMS-USA (University of Minnesota, www.ipums.org).

A bar chart showing the California poverty measure poverty rate for workers in 2019 where young adult workers in California are twice as likely to be unable to afford basic needs as older adults.

In part this reflects the fact that young adults, and particularly Black and Latinx youth, are more likely to be paid low wages. More than 3 in 4 Californians ages 18 or 19 and nearly half of workers ages 20 to 29 were paid low wages in 2021, compared to around one-quarter of older workers.2UC Berkeley Labor Center, Low-Wage Work in California Data Explorer (May 12, 2022). In addition, national data show that average wages tend to be lower for Black and Latinx young adults compared to all youth, highlighting how discrimination and structural racism block many young people of color from economic stability early in life.3Natalie Spievack and Nathan Sick, The Youth Workforce: A Detailed Picture (Urban Institute: July 2019) and Natalie Spievack For People of Color, Employment Disparities Start Early (July 25, 2019). Data limitations mean it is often not possible to reliably show the diverse range of experiences among Asian Americans and Pacific Islanders. But national studies show that income and poverty rates and hourly wages vary widely among the diverse communities who identify as Asian or Pacific Islander. Asha Banergee, Understanding Economic Disparities Within the AAPI Community (Economic Policy Institute: June 7, 2022) and Cy Watsky, The Economic Reality of the Asian American Pacific Islander Community Is Marked by Diversity and Inequality, Not Universal Success (National CAPACD and Prosperity Now: November 2020). In addition, many Asian and Pacific Islander Californians report experiencing workplace discrimination and wage theft – particularly those with low incomes. PRRI and AAPI Data, The Working Lives and Struggles of Asian Americans and Pacific Islanders in California: Findings from the 2019 AAPI California Workers Survey (November 18, 2019).

Working Part-Time Involuntarily or to Accommodate Life Situations Leads to Low Earnings for Many Young Adults

Some youth are only able to work part-time because they need to accommodate life situations – such as only being available to work hours that do not conflict with school schedules – while others are stuck in part-time jobs involuntarily because they cannot secure full-time work.4Young adults in California are about twice as likely to work part-time as older adults. More than half of California workers ages 16 to 24 were employed part-time, on average, from 1994 to 2021, which was more than twice the rate of part-time work for workers ages 25 to 54. Economic Policy Institute analysis of Current Population Survey microdata from the US Census Bureau. Young California workers are nearly twice as likely as older workers to work part-time involuntarily.5On average, California workers ages 16 to 24 were nearly twice as likely to work part-time involuntarily as adults ages 25 to 54 from 1994 to 2021. This means they wanted and were available for full-time work, but were working part-time because they could not find full-time jobs. Economic Policy Institute analysis of Current Population Survey microdata from the US Census Bureau.

They are also more likely to experience periods of unemployment and change jobs more frequently than older workers, which can reduce their annual earnings. National data show that Black and Latinx young adults are especially likely to be underemployed, defined broadly as being unable to secure a job, despite being available to work, or working part-time involuntarily because they cannot find full-time work.6 Economic Policy Institute, State of Working America Data Library, Underemployment by Race and Age (2022). These data reflect a measure of underemployment that includes people who work part-time involuntarily plus people who are not working, but want a job, are available for work, and searched for employment within the past year.

Investing in the CalEITC Would Boost the Economic Security of Young Workers

Many policies are needed to address work conditions and workers’ needs to ensure California doesn’t lose a generation of young people who want to establish lives and careers in the place they call home. But young Californians can’t change the job market or job conditions alone. One concrete step that state leaders can take to help build pathways to economic security for young Californians is to expand and increase tax credits such as the CalEITC, which has helped millions of workers earning low wages pay for their basic needs.

Nearly one-third of Californians who receive the CalEITC are under age 25 — around 1 million Californians in total.

Investing in the CalEITC would boost the incomes of young people as they are just entering the workforce, helping to put them on more stable financial footing as they work and go to school or begin their careers. Nearly one-third of Californians who receive the CalEITC are under age 25 – around 1 million Californians in total. The CalEITC is particularly important for these young adults because the overwhelming majority of them are currently excluded from the federal EITC and they typically get limited assistance from other public supports.7The federal EITC currently excludes workers under age 25 who are not supporting children in their homes. Just 5% of California workers ages 16 to 24 lived with their own children in 2019, according to the US Census Bureau, American Community Survey, suggesting that most young adult workers do not qualify for the federal EITC. In tax year 2021, the federal EITC was extended to many of these workers – those ages 19 to 24, excluding those attending school at least part-time. But this expansion expired after one year. The exclusion of young childless workers from the EITC “is based on the assumption that young adults receive familial support in their transition to adulthood, which is untrue for many and disproportionately unlikely for young people of color.” Amelia Coffey, Gina Adams, and Heather Hahn Young People and Tax Credits: The Earned Income Tax Credit and Child Tax Credit (Urban Institute: February 2021), p. 8. Young adults without children also generally do not qualify for major public supports unless they are disabled and unable to work, and benefits they do qualify for are typically limited. Gina Adams, Heather Hahn, and Amelia Coffey Stabilizing Young People Transitioning to Adulthood: Opportunities and Challenges with Key Safety Net Programs (Urban Institute: February 2021).

A pie chart showing the age of tax filers who received the California Earned Income Tax Credit (CalEITC) during the 2021 tax year where about 3 in 10 Californians who receive the CalEITC are under age 25.

Young adults ages 18 to 24 would especially benefit from increasing the CalEITC because most of them currently qualify for very small credits. This is because the CalEITC provides very little support to people without dependent children, and the vast majority of young adults are not supporting children in their homes.

Californians without dependent children qualified for a maximum credit of just $255 from the CalEITC in tax year 2021 – an amount that would not even cover one-fifth of one month’s rent for a studio apartment in Los Angeles.8Fair Market Rent (FMR) for a studio apartment in Los Angeles in 2022 was $1,384. FMRs are published annually by the US Department of Housing and Urban Development and are broadly representative of typical rent paid within a metropolitan area.

The CalEITC Can Be Especially Meaningful for Young Adult Workers of Color

Most California workers under age 25 who are likely eligible for the CalEITC are people of color. This includes about 58% who are Latinx, 9% who are Asian/Pacific Islander, and 6% who are Black.9Due to data limitations, it is not possible to present reliable estimates for Pacific Islander individuals alone or for American Indian or Alaska Natives. Budget Center analysis of US Census Bureau, American Community Survey public-use microdata, using an income tax simulation model developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Based on CalEITC in tax year 2019, adding ITIN filers, who became eligible for CalEITC in tax year 2020 Viewed another way, young Black and Latinx workers are especially likely to qualify for the CalEITC, likely reflecting the fact that these workers are more likely to be paid low wages.

A bar chart showing the percentage of California workers ages 18 to 24 who are likely eligible for the California Earned Income Tax Credit (CalEITC) where around half of Black and Latinx young adult workers likely qualify for the CalEITC.

Specifically, about half of Black workers ages 18 to 24 likely qualify for the CalEITC, as do about half of Latinx workers ages 18 to 24. In addition, about 2 in 5 white workers in the same age group likely qualify for the CalEITC, as do more than one-third of Asian/Pacific Islander young workers.

This means that an investment in the CalEITC would benefit around 1 in 2 Black and Latinx working young adults, and around 1 in 3 Asian and Pacific Islander and 2 in 5 white young workers.

California Can Help Generations of Young Adult Workers Build Economic Security

California’s young workers want to live and work in their communities and should be able to count on access to economic pathways in the state they call home. But having enough money to make ends meet and securing a good-paying job during the ages of 18 to 24 can be a challenge for many Californians who may be managing school, trying to start careers, and blocked from educational and workplace opportunities.

State leaders can ensure young California workers are not on their own to build economic security by:

  • adopting policies that push low wages
  • improving job quality
  • addressing workplace and other discrimination
  • strengthening public supports that help young adults meet their basic needs.

Investing in tax credits such as the CalEITC that specifically benefit young workers is one important step policymakers can take to help generations of Californians meet basic needs and thrive in their communities.


Support for this report was provided by the Conrad N. Hilton Foundation.

  • 1
    Budget Center analysis of US Census Bureau, American Community Survey public-use microdata developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Microdata used to construct the California Poverty Measure were downloaded from IPUMS-USA (University of Minnesota, www.ipums.org).
  • 2
    UC Berkeley Labor Center, Low-Wage Work in California Data Explorer (May 12, 2022).
  • 3
    Natalie Spievack and Nathan Sick, The Youth Workforce: A Detailed Picture (Urban Institute: July 2019) and Natalie Spievack For People of Color, Employment Disparities Start Early (July 25, 2019). Data limitations mean it is often not possible to reliably show the diverse range of experiences among Asian Americans and Pacific Islanders. But national studies show that income and poverty rates and hourly wages vary widely among the diverse communities who identify as Asian or Pacific Islander. Asha Banergee, Understanding Economic Disparities Within the AAPI Community (Economic Policy Institute: June 7, 2022) and Cy Watsky, The Economic Reality of the Asian American Pacific Islander Community Is Marked by Diversity and Inequality, Not Universal Success (National CAPACD and Prosperity Now: November 2020). In addition, many Asian and Pacific Islander Californians report experiencing workplace discrimination and wage theft – particularly those with low incomes. PRRI and AAPI Data, The Working Lives and Struggles of Asian Americans and Pacific Islanders in California: Findings from the 2019 AAPI California Workers Survey (November 18, 2019).
  • 4
    Young adults in California are about twice as likely to work part-time as older adults. More than half of California workers ages 16 to 24 were employed part-time, on average, from 1994 to 2021, which was more than twice the rate of part-time work for workers ages 25 to 54. Economic Policy Institute analysis of Current Population Survey microdata from the US Census Bureau.
  • 5
    On average, California workers ages 16 to 24 were nearly twice as likely to work part-time involuntarily as adults ages 25 to 54 from 1994 to 2021. This means they wanted and were available for full-time work, but were working part-time because they could not find full-time jobs. Economic Policy Institute analysis of Current Population Survey microdata from the US Census Bureau.
  • 6
     Economic Policy Institute, State of Working America Data Library, Underemployment by Race and Age (2022). These data reflect a measure of underemployment that includes people who work part-time involuntarily plus people who are not working, but want a job, are available for work, and searched for employment within the past year.
  • 7
    The federal EITC currently excludes workers under age 25 who are not supporting children in their homes. Just 5% of California workers ages 16 to 24 lived with their own children in 2019, according to the US Census Bureau, American Community Survey, suggesting that most young adult workers do not qualify for the federal EITC. In tax year 2021, the federal EITC was extended to many of these workers – those ages 19 to 24, excluding those attending school at least part-time. But this expansion expired after one year. The exclusion of young childless workers from the EITC “is based on the assumption that young adults receive familial support in their transition to adulthood, which is untrue for many and disproportionately unlikely for young people of color.” Amelia Coffey, Gina Adams, and Heather Hahn Young People and Tax Credits: The Earned Income Tax Credit and Child Tax Credit (Urban Institute: February 2021), p. 8. Young adults without children also generally do not qualify for major public supports unless they are disabled and unable to work, and benefits they do qualify for are typically limited. Gina Adams, Heather Hahn, and Amelia Coffey Stabilizing Young People Transitioning to Adulthood: Opportunities and Challenges with Key Safety Net Programs (Urban Institute: February 2021).
  • 8
    Fair Market Rent (FMR) for a studio apartment in Los Angeles in 2022 was $1,384. FMRs are published annually by the US Department of Housing and Urban Development and are broadly representative of typical rent paid within a metropolitan area.
  • 9
    Due to data limitations, it is not possible to present reliable estimates for Pacific Islander individuals alone or for American Indian or Alaska Natives. Budget Center analysis of US Census Bureau, American Community Survey public-use microdata, using an income tax simulation model developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Based on CalEITC in tax year 2019, adding ITIN filers, who became eligible for CalEITC in tax year 2020

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Californians are working hard every day, supporting their families and contributing to our communities. But simply having a job does not guarantee economic security in California. Many people live in poverty even with a job.

Californians need good-paying jobs, economic opportunities, and resources to build a life for themselves and their families to thrive. State leaders can build an inclusive California where all people have the resources they need to pay for basic needs and no one is left on their own to make ends meet.

Most Californians in Poverty Live in Working Families

No person — regardless of age, zip code, race, or gender — should struggle to make ends meet. But many Californians are struggling and far from thriving — even though they have a job. About 8 in 10 Californians who can’t afford basic needs live in working families, according to data from the California Poverty Measure.1This data point excludes individuals in families that include only seniors. Budget Center analysis of US Census Bureau, American Community Survey public-use microdata developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Microdata used to construct the California Poverty Measure were downloaded from IPUMS-USA (University of Minnesota, www.ipums.org).

A pie chart showing the family work status for individuals in poverty as of 2019 where eight in ten Californians who can't afford basic needs live in working families.

Race, gender, or any other individual characteristic should not affect people’s ability to make ends meet. Yet Latinx Californians in working families, as well as immigrants and women in working families, are more likely to be unable to afford basic needs.

About 1 in 5 Latinx Californians (19%) couldn’t make ends meet despite living in working families, compared to 14% of all individuals in working families.2Data limitations mean it is not possible to reliably show the diverse range of experiences among Asian and Pacific Islander Californians, but national studies show that income and poverty rates vary widely among the diverse communities who identify as Asian or Pacific Islander. See for example, Cy Watsky, The Economic Reality of the Asian American Pacific Islander Community Is Marked by Diversity and Inequality, Not Universal Success (National CAPACD and Prosperity Now: November 2020). In addition, 18% of immigrant Californians in working families did not have enough resources to afford basic needs, compared to 12% of people who are not immigrants, while 14% of women in working families could not afford basic needs, compared to 12% of men. Young adult workers were also especially likely to struggle to meet basic needs.

A bar chart showing the California poverty measure poverty rate for individuals in working families in 2019, where Latinx Californians in working families are most likely to be unable to afford basic needs.

Racist and Sexist Policies and Practices Keep Many Californians in Low-Paying Jobs

Economic inequities for workers in California reflect the culmination of centuries of racist and sexist policies together with ongoing discrimination and biases that have led to the segregation of people of color and women into low-paying jobs.3Marina Zhavoronkova, Rose Khattar, and Mathew Brady, Occupational Segregation in America (Center for American Progress: March 29, 2022); Danyelle Solomon, Connor Maxwell, and Abril Castro, Systematic Inequality and Economic Opportunity (Center for American Progress: August 7, 2019). These low-paying jobs fail to provide the economic stability and security that all people deserve. In California in 2021, more than 2 in 5 Latinx workers (42%), one-third of Black workers (33%), and 35% of immigrant workers were paid low wages, compared to 30% of all workers.4UC Berkeley Labor Center, Low-Wage Work in California Data Explorer (May 12, 2022). Low-wage work is defined as being paid less than two-thirds of the median full-time wage for all workers, which was $18.02 in 2021. It is not clear from the source whether all of the differences in percentage of workers paid low wages are statistically significant. In addition, 34% of women were paid low wages, compared to 26% of men.

Understanding Poverty and Workplace Discrimination for LGBTQ+ Individuals

Wage data for LGBTQ+ individuals are extremely limited, pointing to the need for more public investment in equitable and inclusive data collection.5The acronym “LGBTQ+” is a collective acronym for lesbian, gay, bisexual, transgender, queer or questioning, and other sexual and gender identities. The addition of the “+” indicates inclusion of other identities not encompassed by “LGBTQ,” including but not limited to those who identify as intersex, nonbinary, and asexual. A cisgender person is a person whose gender identity aligns with the sex they were assigned at birth. However, national and California data show that transgender people have particularly high poverty rates.6M. V. Lee Badgett, Soon Kyu Choi, and Bianca D.M. Wilson, LGBT Poverty in the United States: A Study of Differences Between Sexual Orientation and Gender Identity Groups (UCLA School of Law Williams Institute: October 2019).The analysis is based on data from 35 states. The study also finds that for nearly all sexual orientation and gender identity groups, people of color had significantly higher poverty rates than white people. See also Soon Kyu Choi, M. V. Lee Badgett, and Bianca D. M. Wilson, State Profiles of LGBT Poverty in the United States (UCLA School of Law Williams Institute: December 2019). Recent California data also show that LGBTQ+ individuals overall have been more likely to struggle to pay for basic expenses during the pandemic than cisgender straight Californians.7Budget Center analysis of US Census Bureau, Household Pulse Survey data collected July 21, 2021 to August 8, 2022.

One factor that contributes to economic hardship among LGBTQ+ individuals is workplace discrimination, which is a common experience for LGBTQ+ workers. A recent study found that 1 in 10 had experienced discrimination in the past year and nearly half had experienced unfair treatment at work at some point in their careers.8Brad Sears, et al. LGBT People’s Experiences of Workplace Discrimination and Harassment (UCLA School of Law Williams Institute: September 2021).

State Leaders Can Support Working Californians Struggling to Make Ends Meet

As state leaders build an inclusive state and economy, policies and resources must respect and support working Californians so they can work, take care of their families, and contribute to their communities.

California has been a national leader in establishing policies to support workers who earn little from their jobs, including by raising the state’s minimum wage and establishing and expanding California’s Earned Income Tax Credit, commonly known as the CalEITC.

State leaders can build on this progress and further support workers by:
  • continuing to raise wages and improve jobs
  • increasing workers’ collective bargaining power
  • fighting against persistent inequities in pay and benefits by race, ethnicity, immigrant, gender, and LGBTQ+ status
  • expanding and increasing public supports, like the CalEITC and other cash and safety net supports, that help working Californians make ends meet.

These policies would help to create an inclusive California where all workers — and all Californians — have the resources they need to afford food, housing, child care, and meet all of their basic needs. 

  • 1
    This data point excludes individuals in families that include only seniors. Budget Center analysis of US Census Bureau, American Community Survey public-use microdata developed for the California Poverty Measure, a joint project of the Stanford Center on Poverty and Inequality and the Public Policy Institute of California. Microdata used to construct the California Poverty Measure were downloaded from IPUMS-USA (University of Minnesota, www.ipums.org).
  • 2
    Data limitations mean it is not possible to reliably show the diverse range of experiences among Asian and Pacific Islander Californians, but national studies show that income and poverty rates vary widely among the diverse communities who identify as Asian or Pacific Islander. See for example, Cy Watsky, The Economic Reality of the Asian American Pacific Islander Community Is Marked by Diversity and Inequality, Not Universal Success (National CAPACD and Prosperity Now: November 2020).
  • 3
    Marina Zhavoronkova, Rose Khattar, and Mathew Brady, Occupational Segregation in America (Center for American Progress: March 29, 2022); Danyelle Solomon, Connor Maxwell, and Abril Castro, Systematic Inequality and Economic Opportunity (Center for American Progress: August 7, 2019).
  • 4
    UC Berkeley Labor Center, Low-Wage Work in California Data Explorer (May 12, 2022). Low-wage work is defined as being paid less than two-thirds of the median full-time wage for all workers, which was $18.02 in 2021. It is not clear from the source whether all of the differences in percentage of workers paid low wages are statistically significant.
  • 5
    The acronym “LGBTQ+” is a collective acronym for lesbian, gay, bisexual, transgender, queer or questioning, and other sexual and gender identities. The addition of the “+” indicates inclusion of other identities not encompassed by “LGBTQ,” including but not limited to those who identify as intersex, nonbinary, and asexual. A cisgender person is a person whose gender identity aligns with the sex they were assigned at birth.
  • 6
    M. V. Lee Badgett, Soon Kyu Choi, and Bianca D.M. Wilson, LGBT Poverty in the United States: A Study of Differences Between Sexual Orientation and Gender Identity Groups (UCLA School of Law Williams Institute: October 2019).The analysis is based on data from 35 states. The study also finds that for nearly all sexual orientation and gender identity groups, people of color had significantly higher poverty rates than white people. See also Soon Kyu Choi, M. V. Lee Badgett, and Bianca D. M. Wilson, State Profiles of LGBT Poverty in the United States (UCLA School of Law Williams Institute: December 2019).
  • 7
    Budget Center analysis of US Census Bureau, Household Pulse Survey data collected July 21, 2021 to August 8, 2022.
  • 8
    Brad Sears, et al. LGBT People’s Experiences of Workplace Discrimination and Harassment (UCLA School of Law Williams Institute: September 2021).

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All Californians deserve to be able to put food on the table, pay the rent, and meet their basic needs. In short, no Californian should ever live in poverty.

Our state should aspire to be a place where no child or adult struggles to afford their basic needs, and there’s proof that it can be a reality. Recent data released by the US Census Bureau show that poverty — especially for children — significantly dropped nationally and in California in 2021, and would have been much higher if not for public supports.

That’s good news that may be unexpected as the effects of the pandemic and inflation are still very real for California children, adults, and families struggling to make ends meet. So many may be wondering: How did poverty rates drop across the US and California? And amid the pandemic no less.

The answer is simple: Poverty is a policy choice. When we choose to provide the basic support families and individuals need to thrive — as policymakers did via tax credits and other support — it really works.

What is the Supplemental Poverty Measure? And why is it important?

Public policies work best when they are crafted with reliable data and provide positive and measurable results at both the macro level and personal level for our communities.

To measure poverty in California and the success of poverty reduction strategies, we rely on data from the US Census Bureau which routinely surveys households across the country. Each September the Census releases new data that show what share of the population experienced poverty in the prior year — under the official poverty measure and the Supplemental Poverty Measure — for California and states across the country, as well as the United States as a whole.

The Supplemental Poverty Measure (SPM) is vital because it provides a more accurate picture of poverty by accounting for local differences in the cost of housing and accounting for expenses that families must pay like health care and child care. The SPM also accounts for a wide variety of safety net supports, including those that are not direct cash payments — including tax credits, food assistance, and housing subsidies. The official poverty measure does not adjust for differences in the costs of living and ignores non-cash benefits. This makes the official poverty measure less useful to evaluate poverty in California as well as the effectiveness of poverty reduction measures.

Bottom line: The SPM captures how much it costs to pay for basic needs and the resources people have available to pay for them.

Want to learn more about poverty measures?

Check out the Budget Center’s guide to understanding poverty measures in California.

Poverty dropped from 2020 to 2021 nationally and in California — what’s behind the drop in poverty, especially for kids?

Multiple factors likely contributed to the drop in poverty year over year, including the improving job market. Data show too that strong public policies played an especially key role in the low poverty rates seen in 2021. To combat the uncertainties of the pandemic and our economy, state and federal governments provided additional support directly to people, and this made the difference for many families in having the resources to pay for food, housing, diapers, and other basic necessities.

Refundable tax credits were especially effective in boosting family resources in 2021, particularly because of temporary expansions of federal credits last year. Without these credits, overall poverty would have been significantly higher in 2021.

Unfortunately, the temporary expansion to the federal Child Tax Credit that lifted nearly 3 million children out of poverty nationally last year has now expired due to Congress’ failure to permanently expand the credit. The temporary expansion of the federal Earned Income Tax Credit (EITC) for workers without dependent children has also expired. But the evidence is clear — federal policymakers can significantly lower poverty by permanently expanding the Child Tax Credit and the EITC and state policymakers can build on the success of California’s refundable tax credits, the CalEITC and Young Child Tax Credit.

How did housing costs affect California’s poverty rate?

There is no question safe, stable housing is the foundation to families’ basic needs being met, yet the cost of housing is a challenge in many parts of the state — and high housing costs directly affect California’s SPM poverty rate.

California’s poverty rate in 2021 was higher under the Supplemental Poverty Measure than under the official poverty measure — and this has been true in every year that SPM poverty data have been available, going back more than 10 years. This is mainly because, as previously noted, the SPM accounts for local differences in housing costs, so that families need more resources to be categorized as above the SPM poverty threshold (and not experiencing poverty) in places where housing is expensive, which include many parts of California. These data point to another way policymakers can effectively reduce poverty — by addressing California’s housing affordability challenges, through boosting the supply of affordable housing, protecting tenants, and providing direct support to help people afford housing costs.

Why does it matter for everyday Californians that the poverty rate dropped?

The lower 2021 poverty rate shows that our economy and safety net can work better for everyday Californians when good policy and investment come together to help people meet their basic needs. It reveals how many people can meet basic expenses like housing, food, child care, and other necessities — and it also reveals where our public policies are sorely failing.

A lower poverty rate under the Supplemental Poverty Measure means fewer families worrying about where their next meal comes from or wondering if they can keep the lights on. And while the encouraging Census data does not diminish the fact that the high cost of housing and recent high inflation have made it even more difficult for families to flourish in California communities, it does help us understand how we can build on public policies that work to help families now and in the future.

Poverty data from 2021 show that when increased state and federal support was provided, more people were able to count on having enough resources to make ends meet.

What were the primary forms of assistance people received to help meet their basic needs?

Safety net programs that help people pay for food, health care, housing, child care, and other basic needs are essential to the well-being of our people and state.

Current safety net programs — including those used to successfully lower poverty rates in 2021 — are a combination of state and federal supports aimed at helping individuals and families pay for basic needs. These programs can be divided into three categories including cash supports, tax credits, and non-cash benefits.

  • Cash support through tax credits: Federal Child Tax Credit and EITC, state CalEITC and Young Child Tax Credit, as well as child and dependent care tax credits and pandemic stimulus payments.
  • Other cash supports: Social Security, TANF (known as CalWORKs in California), Supplemental Security Income/State Supplementary Payment (SSI/SSP), Unemployment Insurance.
  • Non-cash benefits: SNAP food assistance (known as CalFresh in California), Supplemental Nutrition Program for Women, Infants, and Children (WIC), school meals, energy assistance, and housing subsidies like federal Housing Choice Vouchers.

Together, these programs significantly reduced poverty, particularly child poverty, in California in 2021.

Additional programs that help reduce the out-of-pocket costs people must pay for necessary expenses — particularly Medi-Cal health coverage and subsidized child care — also reduced the number of Californians experiencing poverty last year.

It’s important to remember that each program has unique and sometimes burdensome processes to receive assistance. Moving forward, policymakers should streamline and strengthen existing programs in order to further reduce poverty every year.

What can policymakers learn from the latest poverty data?

First and foremost, the latest Census data show us that poverty is a policy choice — we can choose to provide support needed so that families and individuals can thrive.

Federal and state governments have effective tools — like refundable tax credits — for getting cash to people and rapidly reducing poverty. When we prioritize the health and well-being of everyday people regardless of their race, age, or immigration status the result will be a country where far fewer people experience poverty and its devastating consequences.

State and federal policymakers should boost investment in the policies and tools we know are effective in helping families and individuals meet their basic needs to end poverty in California and across the country.

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Every year, California’s 58 counties adopt local budgets that provide a framework and funding for critical public services and systems — from health care and safety net services to elections and the justice system.

But county budgets are about more than dollars and cents.

A county budget expresses our values and priorities as residents of that county and as Californians. At its best, a county budget should reflect our collective efforts to expand opportunities, promote well-being, and improve the lives of Californians who are denied the chance to share in our state’s wealth and who deserve the dignity and support to lead thriving lives.

Because county budgets touch so many services and our everyday lives, it is critical for Californians to understand and participate in the annual county budget process.

Because county budgets touch so many services and our everyday lives, it is critical for Californians to understand and participate in the annual county budget process to ensure that county leaders are making the strategic choices needed to allow every Californian — from different races, backgrounds, and places — to thrive and share in our state’s economic and social life.

This guide sheds light on county budgets and the county budget process with the goal of giving Californians the tools they need to effectively engage local decision makers and advocate for fair and just policy choices.

Key Takeaways

State Budget Terms Defined

What’s the difference between a trailer bill and a policy bill? A surplus and an operating surplus? Special funds and the General Fund? And what exactly is a “Budget Bill Jr.”? Our Glossary of State Budget Terms answers that and more.

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