What the New Poverty Numbers Mean for Young Kids

Monday, the Census Bureau released its new Supplemental Poverty Measure (SPM), a second measure of poverty that was created to provide a fuller picture of poverty in the United States. This fuller picture shows more Americans may be living in poverty than was previously thought.

The new measure takes into account changes in families’ and individuals’ spending since the original poverty measures were developed in 1963, and the impact that poverty-reducing programs have on curbing poverty rates.

According to the Supplemental Poverty Measure, 18.2 percent of children were living in poverty in 2010, which is a lower rate than the official estimate of 22.5 percent. For adults and seniors, however, poverty rates were higher under the SPM. The national poverty rate is higher under the supplemental measure too: 16.0 percent, or 49.0 million people, in 2010 as opposed to the official estimate of 15.2 percent, or 46.6 million people:

Children aren’t the only group with a lower poverty rate under the supplemental measure. Renters, individuals living in the Midwest and the South and those only covered by public health insurance are among the groups that have lower poverty rates according to the SPM.

The new poverty measure is essentially trying to better measure the resources of an individual. That includes resources that the individual spends, such as child care expenses, child support, or medical out-of-pocket expenses, that aren’t accounted for in the official poverty measure. It also includes resources a person might gain aside from their income, mostly from programs that are a part of the so-called “social safety net”, including the Supplemental Nutritional Assistance (SNAP, or food stamps), free- and reduced-priced school lunches for kids, housing subsidies and the Earned Income Tax Credit (EITC).

When the Census poverty measure was developed in the 1960’s, most government assistance to those in poverty came in the form of cash. These cash payments (i.e. welfare) are included in a person’s “income” in the Official Census calculations. Today, public assistance is less about cash outlays than about safety net programs and tax credits that provide families with at least some cushion against the effects of poverty. The SPM is an important addition to the Official measure because it accounts for changes in how we distribute government assistance over the last 50 years.

If the Census Supplemental Poverty Measure does what it was created to do—provide a more accurate measure of poverty that takes into account the social safety net provided by government programs—then these numbers are pretty troubling. More people are living in poverty than we previously thought, despite government efforts to provide families with relief during recent recession years. The silver lining is that children seem to be one of the only groups whose poverty is effectively curbed by the existing system, a good sign for those trying to aid children through government assistance.