Evidence is surfacing that the current economic and foreclosure crisis has led to an increase in the number of homeless children. We know from prior research that family homelessness is more sensitive to economic cycles than individual homelessness (Culhane et al., 2003). While it is difficult to find data that accurately describes the impact of the current economic crisis on families and children, several reports from 2008 discuss what is likely the beginning of a trend; see, for example, HUD’s 2008 AHAR and the NAEHCY report, The Economic Crisis Hits Home (Duffield & Lovell, 2008).
AHAR data collection for the 2008 report ended in September 2008, just as the economic crisis was accelerating. The HUD report warns that the full effect has yet to be observed in their data. In addition, the report acknowledges, as we note above, that people who lose their homes due to financial struggles often stay with friends and relatives as long as possible before resorting to shelter. Since AHAR counts only families that enter the formal shelter system and not those living doubled up or in motels, this is another reason why the impact of the economic crisis is not fully reflected in this report.
AHAR shows an overall increase from 2007 to 2008 of 9 percent, which represents about 43,000 persons in homeless families, while there was an overall reduction in the number of sheltered individuals not in families. Also, there is growing evidence of the negative impact of the economic and foreclosure crisis on families in suburban and rural areas. Historically, sheltered homelessness is concentrated in urban areas. Between 2007 and 2008, AHAR shows a shift from urban to suburban and rural areas. Part of this shift is due to a large increase in the percentage of sheltered homeless families in suburban and rural areas, from 26.9 percent to 38.3 percent, while the number in cities decreased. Reports on the state level indicate a similar trend. For instance, in Connecticut, while there was an overall decrease of 12 percent for homeless families, there was a 33 percent increase in homeless families and children in rural and suburban areas during the same reporting period.
The impact of the economic and foreclosure crisis can also be seen in data that show a higher rate of movement from stable housing to homelessness. AHAR shows that the share of homeless families that indicated they had been in the place they stayed prior to shelter entry for at least a year rose from 18 percent to 23 percent.
The NAEHCY report (2008) examined recent increases in student homelessness as reported by school districts across the county. The report was based on a survey conducted in the fourth quarter of 2008. A link to the Web-based survey was sent to state education coordinators who either forwarded the survey to their local school districts or provided NAEHCY with email addresses to contact LEAs directly. At the time of the survey there were 14,598 school districts nationwide, of which 1,716 completed the survey. Schools from urban, suburban, and rural areas across the country participated. While the report is not statistically representative of all school districts in terms of geography, demography, or size, it does provide insight into the impact of the economic and foreclosure crisis on enrollment of homeless children in schools.
Of the school districts that participated in the NAEHCY survey, 330 (19 percent) reported that during the first few months of the 2008–09 school year they had enrolled the same number or more homeless students as in the entire 2007–08 school year. Three months into the 2008–09 school year, 847 (49 percent) of the responding school districts reported homeless student caseloads had increased 50 percent or more over the entire previous year.
The NAEHCY survey also asked school districts to report on their perceived reasons for increases in homelessness. By far the most common reason reported was the “economic downturn (e.g., job loss, high cost of living).” Second, and more specific, was the foreclosure crisis, and third, other housing-related factors. Notably, the fourth most cited reason was “increasing incidences of domestic violence, substance abuse or other factors negatively influencing mental or physical health.” And fifth, 149 school districts listed “high medical expenses, with inadequate or no health insurance” as a reason for increased homelessness among students.
No doubt some children who are now homeless and have been over the past several years are those whose families became homeless (under either HUD or ED definitions) as a result of the current recession and foreclosure crisis, which began in early 2007. From 2000 to 2006, the number of foreclosures in the United States ranged from 500,000 to 1 million per year. By the summer of 2007, the annualized rate of foreclosures hit 1.5 million and increased to 3 million by the beginning of 2009 (Zandi, 2009).
Many of these children have experienced precipitous changes in economic circumstances rather than ongoing poverty, so they may have different characteristics from children studied in the past. Although children who became homeless as a result of the economic crisis have not been studied as a group, there is research on the impact of parental job loss and economic hardship on children. Family, human, or social capital may also offer some protection to these children. The U.S. Conference of Mayors 2009 Hunger & Homelessness Survey reports that three quarters of participating cities reported an increase in family homelessness, which the report attributed to the recession and the lack of affordable housing. The U.S. Conference of Mayors also reported the largest increase in requests for food assistance observed in the last 18 years.