FINANCE
What income is considered below the poverty threshold in the US?
Record low unemployment and pandemic-related assistance led to decreases in poverty across the US... how does the US Census Bureau calculate the poverty rate?
Defining poverty can be a complex and politically charged task that can incorporate many metrics and variables depending on the organization conducting the analysis. In 2022, the US Census Bureau found no significant changes in the national poverty rate from 2021, with around 37.9 million people or 11.5 percent of the population living in poverty.
US Poverty Rate: 2021 to 2022
| 2021 | 2022 | |||||
| Single Householders |
Female householder | 23% | 23% | |||
| Male householder | 12% | 11.5% | ||||
| Married-couple | 4.8% | 5% | ||||
| Families with related children | With children unde 18 | 9.5% | 14.8% | |||
| With children under 6 | 15% | 15.9% | ||||
| Unrelated Individuals | Female | 17.8% |
22%
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| Male | 21.7% | 18.1% | ||||
| Source: US Census Bureau | ||||||
Child poverty is on the rise
Though the overall poverty rate did not change substantially from 2021 to 2022, the figures for child poverty rose rapidly after the payments for the expanded Child Tax Credit (CTC) ended. Under the American Resuce Plan, twenty-four million additional families could claim the CTC, which was increased in value and sent as monthly payments from July to December 2021. The poverty rate for households with children rose from under ten percent to nearly sixteen percent in a single year. Most scholars have reported that more children have fallen in (or back) into poverty this year as inflation has further cut into the purchasing power of households.
States with the highest poverty rate 2020-2022 [Three year average]
- New Mexico: 18.2%
- Mississippi: 17.%
- Louisiana: 16.9%
- Arkansas: 15.9%
- Kentucky: 15.8%
- Oklahoma: 15.8%
- West Virginia: 15.6%
- Alabama: 14.8%
- District of Columbia: 14.7%
- Texas: 13.7%
Source: US Census Bureau
How is poverty measured in the United States?
Different governments and organizations have their own criteria to measure the percentage of the population affected by poverty. In the United States, the US Census Bureau calculates the annual poverty rate by examining the family income against the poverty threshold. Income data is collected monthly through the Survey of Income and Program Participation (SIPP). The poverty threshold represents the total income needed for a family to remain out of poverty, factoring in the household size.
A look at the 2022 poverty threshold
These thresholds are calculated on a national level and vary according to age and household size.
- For a single individual under sixty-five, the threshold is set at $15,225, which is slightly lower than the threshold set for those over sixty-five, which is $14,036.
- For households with two individuals under sixty-five, the threshold increased to $19,597 (and $20,172 if one child is living in the home) and $17,689 for those over sixty-five (or $20,095 if one child is living in the home).
- For a family of four, with two adults and two children, the poverty threshold was $29,678.
The other thresholds can be found in the 2022 Poverty Report published by the US Census Bureau.
Comparing the incomes of the survey group with the poverty thresholds allows the Census Bureau to calculate the poverty rate.