Measuring Poverty

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The federal poverty guideline, sometimes referred to loosely as the “federal poverty level”, is used to determine eligibility for many federal programs. There are only two variables which are used to determine whether a person or a family is in poverty – the number of members in their household and their total household income. For more on how how the U.S. Census Bureau measures poverty, check out their nifty infographic.

Below are the poverty thresholds for the 48 contiguous states and D.C. for the year 2013:

Total Family Size Total Household Income
1 $11,490
2 $15,510
3 $19,530
4 $23,550
5 $27,570
6 $31,590
7 $35,610

You mean to say that a family of 4 that lives on $25,000 isn’t considered poor? Well, you could accurately say that the federal government does not consider them to be below the poverty guidelines. Many programs extend their eligibility to 133% of the poverty line, so that family of four could be eligible for some benefits.

According to the Census Bureau, noncash benefits like food stamps or housing subsidies do not count. Additionally, the rate is the same for the entire contiguous United States and is adjusted for inflation each year.

Researching Poverty in Your City, County, or State

If you would like to find more information about your city, county, or state, use the Census Bureau’s American Community Survey database. There you will find innumerable measures of poverty (and lots of other information, too). If you need additional assistance, email us!

You may notice that the poverty rate is sometimes given using 5-year estimates, 3-year estimates, or 1-year estimates. The 5-year estimates are calculated by collecting data over the course of a five-year period and averaging the results. These results are more reliable (especially for smaller populations) but obviously take longer to collect than the 1-year measures. The Census Bureau uses 5-year rates in their North Carolina Quick Facts Page.

If you’re still stumped on when to use 5-year estimates and what the differences are between 5-year estimates and 1-year estimates, the Census Bureau’s American Community Survey Handbook contains a longer explanation.

The Supplemental Poverty Measure

So which state is the “poorest”? The “richest”? These questions aren’t as simple as they seem. Many people use the federal poverty level numbers to compare one state to another, but that measure does not take cost of living (which varies greatly by region) into account.

While the federal poverty guidelines are still widely used to determine eligibility for many federal programs, the Census has been also using the Supplemental Poverty Measure since 2010. Check out the history of measuring poverty infographic from the U.S. Census Bureau.

The Supplemental Poverty Rate is a recently developed tool and is helpful in comparing the level of unmet basic needs between geographic regions (though it is NOT used to determine eligibility for any federal programs, the Official Poverty Rate still does that job).

Case in point: California’s Official Poverty Rate (3-year average for 2010-2012) is around 16.5, a little better than N.C.’s 16.8 (We rank as the state with the 13th-highest official poverty rate).

California’s SPM is a whopping 23.5 for the same time period (“poorest” in the country!), because fundamental expenses eat up more of people’s income in California than in North Carolina. North Carolina’s SPM rank is 18th (including DC) for 2012. A ranking of 18th in SPM is nothing to celebrate, but perhaps is a better measure of the difficulty with which North Carolinians provide for their basic needs.

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