U.S. Poor Face Economic Hit As Government Shutdown, Childcare Cliff, Student Loans Converge

Originally Reported By Reuters.com 

WASHINGTON, Sept 29 – Lower income households and Black and Latino communities will be hit hard when a confluence of U.S. economic events kick off next week, including a sharp drop in childcare funding, economists, analysts and government officials said.

About 12.4%, some 41 million, of the U.S.’s 333 million people live at or below the poverty line, the Census Bureau calculates, which is set at about $29,678 for a household of two adults and two chidren.

That rate fell to a record low in 2021 thanks to COVID-19 federal support, but has jumped as these programs expired.


Hardline Republicans in the House have rejected a deal the Republican-led House negotiated with U.S. President Joe Biden in May for $1.59 trillion in discretionary spending in fiscal 2024, paving the way for wide swaths of the government to shut down for the fourth time in a decade.

Everything from economic data releases to food benefits may be suspended beginning on Sunday, and some 2.2. million government workers may be furloughed or forced to work without pay.

The average member of the American Federation of Government Employees earns between $55,000 and $65,000 a year, but thousands of hourly workers earn much less, about $31,200 a year. These workers will all get back pay after the furlough or shutdown is over, but contract workers, who earn even less, are not eligible for the back pay.


A shutdown could cause a rapid loss of food benefits for nearly 7 million low-income women and children on the Special Supplemental Nutrition Program for Women, Infacts and Children, or WIC, U.S. officials said Tuesday.

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