Health & Human Services

4 Takeaways from the Census Report on Poverty

If not for government assistance, millions more would be impoverished, according to the latest data.
by | October 28, 2014

About 2.9 million more Americans would be counted as poor if the federal government took a comprehensive snapshot of people's income and expenses. That's one of the key takeaways from a new report by the U.S. Census Bureau on the supplemental poverty measure (SPM). The measure is an attempt by Census researchers to improve its count of people living in poverty while keeping in place the official measure established in the 1960s and used for an array of federal safety net programs.

The official federal poverty measure for 2013 counted slightly more than 45 million people as poor, roughly 14.6 percent of the population. The SPM shows that the poverty rate was actually higher -- 15.5 percent -- when researchers factored in some types of nondiscretionary spending, such as out-of-pocket medical costs, that aren't included in the official measure. Even more people would have been considered as living in poverty, the data shows, if not for tax credits and noncash benefits offered by the government.

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The bureau's latest accounting of poverty in America offers four insights:

More people would be poor tomorrow if not for safety net programs.

Florida Sen. Marco Rubio and Wisconsin Rep. Paul Ryan both used this year, the 50th anniversary of the federal "War on Poverty," to call for an overhaul of government safety net programs. They argued that the war has failed and that the programs need to be more efficient and effective.

Reasonable people can debate whether any of the myriad programs work as well as they should, but the Census report does show that millions of Americans would fall below the poverty line if several of the major assistance programs ended tomorrow. For example, the poverty rate would be 2.9 percentage points higher -- 9 million more people below the poverty line -- if not for refundable tax credits, such as the Child Care Tax Credit and the Earned Income Tax Credit.

The chart below draws from data in the Census report showing how much higher the SPM poverty rate would be in the absence of specific public assistance programs. In every case, the denominator is the total number of Americans, roughly 313 million. The Census analysis does not take the additional step of trying to estimate the long-term ramifications of ending specific programs, which might still mean more people living in poverty, but also could result in other outcomes, such as people taking undesireable jobs or shifting to other types of assistance. The percent estimates are reported at the 90 percent confidence level.*

  Percent Estimate

Margin of Error

Social Security 24.1 0.4
Refundable Tax Credits 18.4 0.4
Supplemental Nutrition Assistance Program (SNAP) 17.1 0.3
Unemployment Insurance 16.2 0.3
Supplemental Security Insurance (SSI) 16.8 0.3
Housing Subsidies 16.5 0.3
Child Support Received 16.0 0.3
School Lunch 16.0 0.3
Temporary Assistance for Needy Families (TANF)/General Assistance 15.8 0.3
Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 15.7 0.3
Low-Income Home Energy Assistance Program (LIHEAP) 15.6 0.3
Workers' Compensation 15.6 0.3

Some places are poorer than others.

The 15.5 percent figure is the average SPM calculated for all people across the country, but the poverty rate is higher in the urban core of a metro area (20.1 percent). The neighborhoods outside the urban core -- the suburbs -- had a lower poverty rate (13.4 percent). However, the suburbs also had slightly more people in poverty in absolute numbers (21.9 million vs. 20.5 million in cities). Researchers at the Brookings Institution have recorded persuasive evidence that poverty is growing faster in the suburbs than in central cities. While poverty remains a top priority for most big-city mayors, it's becoming a more important issue for suburban governments as well.

Some groups of people are poorer than others.

The Census data shows that poverty is concentrated in certain pockets of society. The poverty rates for blacks and Hispanics, for example, are well above the national average. Renters, as a group, are poorer than homeowners. Households with a single mother are poorer than ones with married couples.

  Poverty Rate Margin of Error
Single Adult Female Householder 28.5 0.9
Renter 27.1 0.7
Foreign-Born Noncitizen 29.2 1.3
Black 24.7 1.2
Hispanic 26.0 1.0

The poor haven't recovered from the recession.

The latest Census report does indicate that the poverty rate declined by half a percentage point between 2012 and 2013. However, the official poverty rate is still several percentage points higher than in 2007, when the last economic recession took place. Researchers at the Brookings Institution predict a slow economic recovery, with the SPM not returning to its pre-recession level until 2020.

*This story has been updated with additional information to clarify what is being shown in the chart on SPM rates and public assistance programs. 

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