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Born Poor? Racial Diversity, Inequality, and the American Pipeline

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Born Poor? Racial Diversity, Inequality, and the American Pipeline Born Poor? Racial Diversity, Inequality, and the American Pipeline Brian C. Thiede Department of Sociology Louisiana State University Scott R. Sanders Department of Sociology Brigham Young University Daniel T. Lichter Departments Policy Analysis and Management & Sociology Cornell University March 6, 2016 Paper prepared for the 2016 annual meeting of the Population Association of America, Washington, DC, March 31, 2016. Born Poor? Racial Diversity, Inequality, and the American Pipeline Abstract We examine racial disparities in infants’ exposure to poverty and other forms of disadvantage at the family and local area levels. Drawing upon data from the American Community Survey, we address four objectives. First, we provide an empirical benchmark of newborns’ exposure to disadvantage at the family level using the official poverty thresholds, a measure of extreme poverty, and other indicators of disadvantage. Second, we use regression techniques to identify the social, demographic, and economic factors that are associated with newborns’ risk of disadvantage, with a focus on poverty, and use decomposition to identify compositional factors underlying between-race differences. Third, we identify the share of disadvantaged newborns whose parents utilize the government safety net, and identify social and economic determinants of program (under)utilization. Finally, we estimate racial differences in newborns’ exposure to disadvantage at the local level, using public-use micro-data areas (PUMAs) as the unit of analysis. Our findings reveal stark racial and ethnic inequalities in newborn infants’ exposure to disadvantage at the level of the family and place of residence, and indicate that among the poor, an additional layer of racial and ethnic inequalities emerge with respect to safety net access. Overall, our results suggest that growing diversity among today’s youngest citizens is not ushering in a new era of equality of opportunity, but rather taking place in a context where the pipeline from infancy to other parts of the life course remains highly segregated by race. 2 1. INTRODUCTION The U.S. Census Bureau projects that the United States will become a “majority minority” society as early as 2043. Racial and ethnic minorities today already account for over one-half of all U.S. births (U.S. Census Bureau 2012). Hispanics alone accounted for nearly one-in-four of the children born (23%) in 2014 (Hamilton et al. 2015). Racial and ethnic diversity is increasingly driven “from the bottom up,” with infants and children (Johnson & Lichter 2008; Lichter et al. 2015). Over the next two decades, today’s disproportionately minority infants and youth will complete school, enter the workforce, and begin families of their own. Will today’s children be adequately prepared for productive adult roles, or are their economic circumstances at birth place them “at risk” of continuing disadvantage over the life course? This is a pipeline issue that will drive the U.S. political debate on immigration, educational policy, and the public safety net system for the foreseeable future (Frey 2013; Lichter 2013). We contribute to an emerging literature on this topic by examining the extent to which today’s newborn infants are exposed in utero to poverty—in families and communities. Prior research has highlighted how exposure to disadvantage during infancy and early childhood can negatively affect brain development (Duncan et al. 1998, Knudsen et al. 2006, Sharkey & Faber 2014). Any negative effects on cognitive development and achievement may persist across the life course, even exceeding the deleterious effects of poverty during adolescence (Brooks-Gunn & Duncan 1997). Early exposure to poverty among today’s infants suggests many correlated developmental challenges as they advance over the life course into adult roles. Robust nationally representative estimates of the level and underlying drivers of disadvantage among newborn infants have only recently been possible. A fertility question in the annual American Community Survey (ACS), i.e., “Has this person given birth to any children in the past 12 months?”, can now 3 directly link infants with comparable data on their families’ income, work status, food stamp receipt, and other indicators associated with disadvantage and participation in programs designed to ameliorate hardship.1 These newly-released fertility data provide a unique opportunity to estimate the incidence of early exposure to economic disadvantages among newborn babies during of period when historically disadvantages populations account for most childbearing in the United States. The circumstances of these infants provide a window to America’s future, and raise important questions about a leaky pipeline into productive adult roles—spouse, parent, worker, and citizen. This paper has four specific objectives. First, we provide an empirical benchmark of newborns’ exposure to disadvantage at the family level, as indicated by poverty status and other indicators of disadvantage (e.g., teen or unwed mothers, low parental educational attainment). Second, we use regression techniques to identify the social (e.g., parental education), demographic (e.g. family size), and economic (e.g., dual- or multi-worker families) factors that are associated with newborns’ risk of disadvantage. We then extend these analyses and use a regression-based decomposition approach to identify factors underlying differences by race and ethnicity. Third, we identify the share of disadvantaged newborns whose parents are dependent on the government safety net, and identify social and economic determinants of program (under)utilization. Finally, we estimate levels and racial differentials in newborns’ exposure to community-level indicators of disadvantage to the extent possible with publically available data. Here, we focus on poverty rates across infants’ public-use microdata areas (PUMAs) of residence. 1 Food stamp receipt is measured at the household level, but we use the term family to describe both cash transfer and food stamp receipt for the sake of parsimony. 4 2. POVERTY, CHILD DEVELOPMENT, AND RACIAL INEQUALITY Recent research has documented the substantial and growing contribution of natural increase (i.e., births in excess of deaths) among ethnoracial minority populations to the overall growth of the U.S. population (Bean et al. 2000, Johnson & Lichter 2008, Johnson & Lichter 2010, Lichter et al. 2015). In the short run, large racial and ethnic differences in rates of natural increase translate into growing diversity, especially among children and youth. Between 1990 and 2008, for example, the share of minorities aged 0-4 increased from 33% to 47% (Johnson & Lichter 2010). The longer run implication is an increasingly diverse population of working- and reproductive-age. Whether growing diversity translates into rising poverty and inequality in the future is in part a demographic question, but also one that focuses the policy spotlight on the economic conditions under which historically-disadvantaged minority children mature into productive (or not) adult roles. Existing research paints an incomplete, but sometimes pessimistic picture of the American pipeline. A large share of today’s minority births is occurring to parents from historically disadvantaged racial and ethnic groups, particularly black and Hispanic populations. In 2013, the poverty rate was 27.2% and 23.5% among these two groups, respectively—far above the poverty rate among non-Hispanic whites (9.6%) (DeNavas-Walt & Proctor 2014). The contours of infant poverty are even more striking. In a recent study, Lichter and colleagues (2015) estimate that 40.9% and 34.8% of Hispanic and non-Hispanic black infants were born into poor families, respectively, compared with 11.9% of Asian infants and 16.1% of non- Hispanic white infants (Lichter et al. 2015). If exposure to disadvantaged circumstances at birth shapes socioeconomic trajectories into adulthood, then racial disparities among newborns raise 5 the prospect of racially-diverging destinies and greater inequality in the future. Growing diversity—and inequality--at the bottom of the age distribution arguably is a portent of American’s future, especially during a period when class boundaries have crystalized and opportunities for upward intergenerational mobility have stagnated or even declined. The study by Lichter et al. (2015) provides a point of departure for our empirical approach. Specifically, we (1) expand the scope of inquiry beyond the Hispanic immigrant population by comparing the largest U.S. racial and ethnic groups, (2) examine multiple dimensions of disadvantage, and (3) analyze the exposure of newborns to disadvantage at both the family and community levels. This step toward a multi-level approach is justified by a large and rapidly growing literature on the social ecology of development among racial minorities and the cumulative impacts of exposure to disadvantage at both the family and community levels (Massey & Brodmann 2014; Sharkey & Faber 2014). The periods in utero and during early infancy have been shown to have large effects on brain development, as well as various cognitive, emotional and physical outcomes. Duncan and colleagues (1998) showed that economic conditions in the early phases of childhood have the largest effect on indicators of attainment (versus later life or current conditions). More recent findings have confirmed that early-life exposure to poverty—even brief spells—has enduring effects over the life course that are
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