Statement: Census Bureau Releases Supplemental Poverty Measure for U.S.

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Frances Deviney /(512) 320-0222 x 106

November 7, 2011

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The Census Bureau released new national-level poverty data today. The Supplemental Poverty Measure (SPM) is a “work in progress” experimental measure intended to provides a more complete picture of what contributes to poverty by attempting to correct for long-argued limitations of the Official Poverty Measure. The Supplemental Poverty Measure differs from the Official Poverty Measure in many ways, such as including a broader range of expenses necessary to make ends meet (e.g., food, shelter, medical expenses, payroll taxes) and accounting for a broader range of resources such as income from tax credits and federal in-kind benefits (e.g., food stamps and housing subsidies).

The 2010 Supplemental Poverty Measure puts poverty at 16 percent compared to 15.2 percent for the Official Measure. Although the rates across ages may not seem that far apart, the Supplemental Poverty Measure adds about three million people to the poverty ranks compared to the official measure. The official poverty measure doesn’t take into account some things that help kids, nor does it take in to account other expenses that significantly impact seniors. When adjusting for these factors, the new measure shows poverty among the elderly to be more of a problem, primarily due to expenses such as rising out-of-pocket medical costs. In contrast, Supplemental Poverty Measure’s rate for children is lower, largely due to the success of nutrition, EITC, and child care subsidy programs that protect children from poverty.