Recession drove up poverty rates in most states

Regional coordinator Charles Evans (4th L) picks up children from school to take them to an after-school program at South Los Angeles Learning Center in Los Angeles, California March 16, 2011.

WASHINGTON (Reuters) - Poverty rates increased in almost all U.S. states and the District of Columbia over the course of the economic recession, with the worst spike in the South, according to a congressional report released on Monday.

In the South the number of people living below the poverty threshold grew by 3.3 million, the Joint Economic Committee found, comparing U.S. Census data from 2007 with the decennial statistics recently released. The South also still has the highest poverty rate, at 16.9 percent.

The number below the poverty line grew by 2.4 million people in the West and 1.6 million in the Midwest. In the Northeast, the ranks of the poor rose by 912,000 in those three years.

Those increases helped push up poverty rates almost universally across the country. The rates increased in 46 states and the District of Columbia and remained unchanged in four states. The largest rises were in Nevada and Florida.

Children living in poverty increased in 42 states and the District of Columbia, with five states and the nation's capital reporting increases of more than five percentage points, the committee said.

The recession that began in 2007 and officially ended in 2009 only spared a few states, and its uniformity was a break from past U.S. downturns. The recovery, though, has been uneven, with states like Nevada seeming unable to escape the shackles of high unemployment and low income.

President Barack Obama is currently touring hard-hit states to rally support for his $447 billion tax and spending proposal intended to jolt the economy to life.

Both Nevada and Florida were walloped by the bursting of the housing bubble. From January 2007 to January 2010, Nevada's unemployment rate more than tripled -- to 14.6 percent from 4.3 percent, according to Labor Department data.

Nevada also had the largest drop in income, falling 11.9 percent from 2007 to 2010, followed by Florida and Arizona, according to the Joint Economic Committee. The committee is composed of 10 representatives from each chamber of Congress and splits its membership between the two political parties.

The District of Columbia has long struggled with a yawning wealth gap between those whose livelihoods depend on the federal government or universities in the city and long-term residents. The recession seemed to stress the inequality.

Incomes in the capital city grew the most in the country, 6.2 percent. At the same time, the District was one of few places that added jobs. Its payroll employment grew by 15,000 people, second only to North Dakota, which added 20,000 jobs.

But Washington also had the third highest poverty rate in the country, 19.2 percent, and the largest rise in the share of children living in poverty, rising 7.7 percentage points to 30.4 percent.

Commodity-rich North Dakota was the sole state that went through the recession unscathed. Currently, it has the lowest jobless rate in the nation. Also, it was the only other place where incomes grew over the last three years. The committee found incomes there increased 5.9 percent.

(Reporting by Lisa Lambert; Editing by Leslie Adler)