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Child tax credits kept 114,000 Michigan children above the poverty line in 2021 and benefited nearly 2 million more. But rising inflation, low wages and high tax burdens still left 44% of Michigan families with kids unable to afford basics such as food, clothing and medical care.
The statistics come from the Michigan League for Public Policy’s 2022 Kids Count data profiles to be released Thursday. These provide a state-specific update to national numbers published last year measuring economic well-being, education, health, and family and community.
This year’s data reveals that Michigan’s children benefited from child tax credits and other policy initiatives, with 9% fewer children living in high-poverty areas and 10% fewer students experiencing homelessness. Children who lived with a single parent were 6% less likely to live in poverty in 2021 than in 2020. Nationally, child poverty dropped more in 2021 than in any year preceding it.
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During the last decade, many indicators of child welfare had been flat or improving nationally. Fewer children lived in poverty, the burden of housing costs affected a lower percentage of families and education metrics such as performance in reading and math remained the same or slightly better. The teen birth rate had dropped markedly since 2010 and other health indicators were stable, if not impressive.
Detroit, in particular, had made tremendous progress in reducing the rate of children living in poverty by one-fifth — though around 43% still did, almost three times the national average.
When the Kids Count data profiles for 2020 were released last year, Michigan had sneaked into the top half of the national rankings for economic well-being at 24th, and was ranked 22nd for health. But a state-to-state comparison of family and community indicators put the state in 29th place, and when it came to education, Michigan dragged among the bottom 10 states in 41st place.
With disruptions to almost every aspect of work and home life, experts knew the pandemic could stall progress or even erode the gains of the past 10 years. Indeed, COVID-19 derailed job security, whirred up uncertainty, forced mothers, especially, out of the workforce and laid bare the lack of safety nets for many families.
American Rescue Plan’s child tax credit offset COVID-19 impacts
This year’s data partially reflect that reality. Teen deaths crept up. Preschool enrollment inched down. In Michigan, 39% of young adults who were planning on taking postsecondary classes in the fall of 2020 reported canceling or scaling back their plans. In Detroit, fewer than one in 10 eighth graders can now solve age-appropriate math problems.
The Michigan League for Public Policy attributes last year’s success in driving down child poverty despite these other setbacks largely to the American Rescue Plan’s historic expansion of the child tax credit. Under that plan, child tax credits increased from $2,000 to $3,000 per child or $3,600 for each child younger than 6 for nearly all families with children.
The payouts managed to stabilize some families’ incomes and allow caregivers to spend on things such as preschool, groceries and rent. Temporary expansions to the Michigan Earned Income and Child and Dependent Care Tax Credits also made an impact.
Kelsey Perdue, the Kids Count Project Director, said the metrics show what investing in education, child care and economic stability can do.
“A lot of the policy wins that we’ve seen over the last year can be credited to our response to the crisis, as well as having tons of federal relief dollars that we can invest in Michigan,” said Perdue.
But the data shows that these successes were not evenly enjoyed:
- Detroit’s student dropout rate increased by almost two-thirds, and the city’s confirmed cases of child abuse or neglect ticked up by 7%.
- On average, 12% of Michigan children live in high-poverty areas, but 41% of children living in high-poverty areas are Black.
- While 81% of Michigan students now graduate on time, that rate is as low as 40% among youths in foster care.
- Although 40,000 more children had internet access in their homes in 2020 than in 2019, nearly a third of kids in some Michigan counties did not.
- Homeless students were twice as likely as their peers to be chronically absent from school.
Nearly one in five Michigan children continue to live in poverty.
Helping child care providers and families
Perdue said to keep Michigan moving in the right direction — and to prevent backsliding on the gains made in keeping kids above the poverty line — COVID-19-era tax credits should be made permanent.
The Michigan League for Public Policy also recommends increasing payments to child care providers, raising the income eligibility threshold for state child care subsidies and eliminating barriers that prevent families from accessing safety net programs, among other suggestions.
Last year’s state budget invested $1.4 billion into child care in Michigan, making changes Perdue said helped both families and child care providers. “But the caveat here is that those changes were temporary, and they will expire,” she said.
She believes the state’s success in improving or maintaining some areas of child well-being during the pandemic should be celebrated, but issued a call to action: “to make sure that we can keep a lot of these investments sustained and not forget about the work that’s still left to do in order to eliminate inequities and then make sure our families are financially secure and able to succeed in school and in life.”
Michigan passed its 2023 state budget earlier this month that included $17.5 billion for school aid — including funding for economically disadvantaged students — and expanded pre-K programs and financing.
President Joe Biden’s Build Back Better agenda calls for an extension of the child tax credit, but it is yet unclear whether the benefit will continue.
Jennifer Brookland covers child welfare for the Detroit Free Press in partnership with Report for America. Reach her at jbrookland@freepress.com.
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