Weathering the Great Recession

Did High-Poverty Neighborhoods Fare Worse?

Weathering the Great Recession


Weathering the Great Recession shows that the economic downturn had devastating impacts for families at every rung of the economic ladder. However, in many ways, families in high-poverty neighborhoods were already experiencing their own hard times before the official downturn, making any additional losses that much more harmful to their economic prospects.  

 The key findings of this analysis include:  

  • There were no differences by neighborhood type in the proportions of residents who had wage losses or family income losses greater than 20 percent. 
  • Families in high-poverty neighborhoods experienced smaller absolute dollar losses in wealth but higher percentage losses than those in low-poverty neighborhoods. 
  • Families in low-poverty neighborhoods were the most likely to be homeowners and to have experienced home equity losses.  However, families in high-poverty neighborhoods were the most likely to be behind on mortgage payments and to expect to be behind on payments in the next 12 months. 
  • Those in high-poverty neighborhoods were the least likely to be employed and the most likely to be unemployed during the recession.  However, the chance of becoming unemployed during the recession did not differ across neighborhood types. 

 These findings provide insight for policy makers working to design effective and targeted policy interventions to strengthen the recovery and address pre-existing challenges faced by residents of high-poverty neighborhoods.