Differences Between Poverty Measures May Reflect Differences in Housing Costs or Noncash Benefits Across States
September 14, 2024
The national official poverty rate (11.1%) was lower than the Supplemental Poverty Measure (SPM) (12.9%) in 2023, according to the U.S. Census Bureau’s report, Poverty in the United States: 2023.
However, an analysis of 3-year averages of poverty rates by states shows the SPM rate was lower than the official rate in 32 states.
SPM rates may be higher in some states for several reasons, from differences in housing costs and homeownership rates to higher taxes or medical expenses.
The two poverty measures provide distinct indicators of U.S. economic well-being.
The SPM broadens the official poverty measure by accounting for government programs designed to assist low-income families that are not included in the official poverty measure while also including federal and state taxes and necessary expenses.
The SPM also considers geographic variation in housing costs and housing tenure (whether one rents or owns their home with or without a mortgage) in poverty thresholds, while the official poverty measure does not.
The Current Population Survey Annual Social and Economic Supplement (CPS ASEC) is the official source of national poverty estimates. To create state-level estimates, the Census Bureau recommends using 3-year averages for additional statistical reliability.
Figure 1 details 3-year average poverty rates for each state from 2021 to 2023 for the SPM and the official poverty measure, which for this analysis includes unrelated individuals under 15 (hereafter referred to as the official+ poverty measure).
The national 3-year average official+ poverty rate from 2021 to 2023 was 11.4% compared to the SPM rate of 11.0%, a 0.4 percentage point difference.
In 2021, the national SPM rate was its lowest rate at 7.8% (SPM rates are available going back to 2009) while 2022 and 2023 national poverty rates were 12.4% and 12.9%, respectively.
Meanwhile, the annual official+ poverty rate ranged from 11.1% to 11.6% between 2021 and 2023 (the 2021 and 2022 rates are not statistically different).
Utah was among the states with the lowest official+ poverty rate (6.7%) and Louisiana among the states with the highest (18.9%).
Maine had one of the lowest SPM poverty rates (5.9%) and California had one of the highest (15.4%).
More official and SPM rates by states and by major age categories can be found in today’s release.
Figure 2 maps the differences between the two measures.
SPM rates may be higher in some states for several reasons, from differences in housing costs and homeownership rates to higher taxes or medical expenses.
Seven states had a higher SPM rate than official+ poverty rate: California, Colorado, Florida, Maryland, Massachusetts, New Jersey and New York.
The official+ poverty rate exceeded the SPM rate in 32 states: Alabama, Arizona, Arkansas, Georgia, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, West Virginia, Wisconsin and Wyoming.
Finally, the rates weren’t statistically different in the District of Columbia and 11 states: Alaska, Connecticut, Delaware, Hawaii, Kansas, Nevada, New Hampshire, Utah, Vermont, Virginia and Washington.
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