Structural Change and the Aggregate Poverty Rate

Abstract

Abstract This paper measures the extent to whichrecent increasesin the aggregate povertyrate are attributable to the changing distribution of employment across industries. We decompose the total poverty rate change over the 1976-1983 period into components attributable to changesin employment sharesand changes in the incidence of poverty within industries. Our results show that the poverty rate increase resulted primarily fromthe decline in employment rates in general and from increases in the incidence of poverty within all industries, rather than from the shift of employment opportunities between sectors. The growth of service sector employment in particular has not contributed to the increased incidence of poverty in the United States.