The Likelihood of Experiencing Relative Poverty over the Life Course

Below: Cumulative percentage of American adults experiencing poverty and extreme poverty by age.

Research on poverty in the United States has largely consisted of examining cross-sectional levels of absolute poverty. In this analysis, we focus on understanding relative poverty within a life course context. Specifically, we analyze the likelihood of individuals falling below the 20th percentile and the 10th percentile of the income distribution between the ages of 25 and 60. A series of life tables are constructed using the nationally representative Panel Study of Income Dynamics data set. This includes panel data from 1968 through 2011. Results indicate that the prevalence of relative poverty is quite high. Consequently, between the ages of 25 to 60, 61.8 percent of the population will experience a year below the 20th percentile, and 42.1 percent will experience a year below the 10th percentile. Characteristics associated with experiencing these levels of poverty include those who are younger, nonwhite, female, not married, with 12 years or less of education, or who have a work disability.

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