Causes of Poverty

  1. Economic vulnerability and human capital

The natural unemployment is a cause of poverty. Some people in the economy have to lose jobs to allow free market economies. People with less valuable human capital are more vulnerable to be poor. People with less human capital are susceptible to experiencing poverty mainly because they are at risk of long periods of unemployment and lower wages. Such circumstances make a person to experience poverty for more extended periods

People who spend most of their time indoors have reduced job opportunities. For instance, is the single mothers who have to pay a lot of time in taking care of their babies. This will reduce the flexibly to land new job opportunities hence being put at a disadvantage of competing in the labor market thus experiencing poverty.

  1. Lack of affordable housing.

The wage earnings and the increased costs of housing leave many families unable to stabilize their economic levels. The high cost of housing can easily make a family to experience poverty. This is due to the high costs incurred in housing facilities.

  1. Drug and substance abuse

The use of drugs induces addiction to the user thus control the user in his entire life. Some addicts pump all their earned money to the purchase of drugs because of the habit. Apart from money spent on the purchase of substance abuse, the drug result in other economic effects such as lower wages and an increased budget for illness. Drugs and substance abuse can easily lead a family into poverty.

  1. Medical expenses

Most of the Americans suffer from tserious illness which is unexpected in their lives. However, these illness require more costs for the longer stays in the hospital. The money used in medical expenses can easily lead a family into poverty.

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