June 14, 2021
Examining Poverty in the United States
In the American Rescue Plan enacted earlier this year, Congress temporarily extended the child tax credit. Congress is considering whether to make this expansion permanent — a decision that requires an understanding of the different official metrics of poverty as well as the various factors associated with poverty for both children and adults. In a new analysis, AAF’s Director of Human Welfare Policy Tara O’Neill Hayes and Madeline VanHorn outline the federal government’s poverty statistics, with a particular focus on those factors most likely to contribute to child poverty.
Their central points:
- Both the Official Poverty Measure (OPM) and the Supplemental Poverty Measure (SPM) indicate that poverty in the United States has been declining for most of the past decade;
- Under both the OPM and SPM, employment and educational attainment are the two best indicators for whether someone is likely to be impoverished, followed by whether the household is headed by an unmarried female; and
- Children are the only age group and one of the only groups among all the characteristics considered to have a lower poverty rate under the SPM compared with the OPM, largely because of the tax credits and benefits available to households with children which are counted as income by the SPM.
Measuring Poverty in the United States: Comparing Measurement Methods.