Originally created 09/25/98

Poverty declines sharply



WASHINGTON -- South Carolina's poverty rate fell by more than 3 percent in the past two years, tying the Palmetto State with Mississippi for the sharpest decline in poverty in the nation.

Meanwhile, the state's median household income rose by 5.5 percent during 1996 and 1997, the ninth largest increase in the country, according to figures released Thursday by the U.S. Census Bureau.

South Carolina's income and poverty numbers were much rosier than in Georgia, where median household income rose by only 1.1 percent -- less than the national average -- and the poverty rate grew by 1.2 percent.

The average poverty rate in South Carolina during the past two years was 13.1 percent, down from the 16.5 percent two-year average in 1995 and 1996. That dramatic drop gave South Carolina the second-lowest poverty rate in the Southeast, higher only than North Carolina.

At the same time, the Palmetto State's median household income during 1996 and 1997 was $34,861, up substantially from the $33,038 median income reported for 1995 and 1996.

The average poverty level nationally for a family of four -- two adults and two children under age 18 -- is $16,276.

South Carolina's progress is the fruition of years of record capital investment in the state, which has helped create jobs and keep unemployment low, said Doug Woodward, director of the research division at the University of South Carolina's College of Business Administration.

A key ingredient in that recipe has been diversification, breaking away from an over-reliance on a few industries, including textiles.

"For the first time in South Carolina history, we've got deep, broad economic growth," Mr. Woodward said. "Probably early in the next century, we'll reach the national average in per-capita income."

Income growth has been much more sluggish in Georgia. According to the Census Bureau, the state's median household income during the past two years was $34,953, up just slightly from the $34,577 median income in 1995 and 1996.

That small increase left Georgia still leading all Southeastern states except North Carolina, but put the Peach State only slightly ahead of South Carolina in the median household income category.

Georgia's poverty rate in 1996 and 1997 was 14.7 percent, up from 13.5 percent during 1995 and 1996.

After years of glowing economic numbers, Georgia has become a victim of its own success in attracting new residents, said Jeff Humphreys, director of economic forecasting at the University of Georgia. While the state has been a national leader in job creation, it also has had to cope with an oversupply of labor spurred by rapid population growth.

"The pressures on wages and salaries have not been very high because of the in-migration of tens of thousands of people every year," Dr. Humphreys said. "That's keeping labor costs down."

Nationwide, the poverty rate last year was 13.3 percent, down from 13.7 percent in 1996, while the median household income rose 1.9 percent to $37,005. Last year was the third in a row that both numbers improved, returning America to pre-recession 1989 levels.

At the White House, President Clinton attributed the economic progress to his policies -- including balancing the federal budget, investing in education and job training and expanding U.S. exports.

"The census report released this morning represents one more year's worth of compelling evidence that this economic strategy is working," Mr. Clinton said.

Progress by blacks and Hispanics was the driving force in the decline in poverty and the increase in median household incomes. But both groups still were vastly overrepresented among the ranks of the poor.

While only 11 percent of whites were living in poverty last year, the poverty rate was 26.5 percent for blacks and 27.1 percent for Hispanics.