Quality of Life - Poverty Rate

What is this measure? The U.S. Census Bureau's American Community Survey (ACS) estimates the number of people living below the poverty line. Poverty thresholds are defined annually for the nation. Poverty is defined as an economic state in which a person or household cannot provide for their most basic needs. Generally speaking, lower poverty rates correlate to stronger economic conditions in a region.

Why do we track this? Nationally, poverty rates are linked to labor market opportunities, as a good job provides a path away from poverty. Persistent poverty is linked to reduced health and educational outcomes for children, which may reduce a child's access to opportunities to exit poverty. Poverty rates can serve as a proxy for understanding the proportion of the population that can access programs that provide assistance to low-income individuals. What are some limitations of this data source? The poverty threshold used for the poverty rate calculation is determined nationally and doesn’t take local cost of living into account. Thus the poverty rate may not accurately represent the number of people living in impoverished conditions in places where the cost of living is particularly high or especially low. Low or reducing poverty rates may be linked to conditions and programs that reduce poverty, or could indicate increased presence of other factors that increase displacement of poor households to other communities. The official Census formula was developed in the 1960s and is closely related to the cost of food. Because of these factors, there are disparities between the published poverty rate and the number of families experience poverty-associated conditions such as food insecurity, reduced access to routine health care, stress and housing insecurity. Conditions that impact a small portion of residents may not be spread evenly throughout communities.

How else can this be measured? Certain public programs use a percentage of median income to estimate eligibility for programs that provide assistance to low-income households. 30% of median income is typically considered "very low income", while 80% of median income is considered "moderate income", with a spectrum of lower income levels between both points. Other organizations have also attempted to develop measures that account for other cost of living factors and the impacts on net income that come from non-cash resources such as tax credits and non-cash benefits (such as food assistance or housing vouchers).

Why did we use this source? The Census poverty rate is the most commonly used, cited, and requested poverty rate statistic. Census ACS data is available for counties and municipalities, as well as at the state and national level. Estimates are updated annually.