Poverty remains a persistent issue in the United States, with millions of Americans unable to make ends meet each year. According to data from the Census Bureau, nearly 38 million Americans lived in poverty in 2021.
How does the federal government define poverty?
The federal government defines poverty based on family size and income. If a family’s total income is less than the poverty threshold set by the federal government, then that family is considered impoverished. The official poverty measure is adjusted annually to account for inflation.
Let’s use 2021 poverty data from the Department of Health and Human Services (HHS) as an example. Using the official poverty measure, a family of four would be considered in poverty if their annual household income was $26,500 or less before taxes. (For 2020-2021, the median household income for a family of such size was $90,657.)
Since the measure is set at the federal level, it does not take into account the varying costs of living in different parts of the country, which can lead to errors in counting.
What are the different ways of measuring poverty?
Poverty can be measured in two ways: poverty guidelines and poverty thresholds.
The HHS uses poverty guidelines to determine a person’s financial eligibility for federal benefits and programs specific to low-income Americans. These include SNAP (Supplemental Nutrition Assistance Program, also known as food stamps), Medicaid, and income-based plans for paying off federal student loans.
Meanwhile, the Census Bureau sets poverty thresholds for the official poverty measure and the Supplemental Poverty Measure (SPM) to calculate the number of Americans living in poverty each year. This number is then used to evaluate trends and current economic conditions within communities and to make comparisons across demographic groups.
Put simply, poverty guidelines are administrative, whereas poverty thresholds are statistical.
What is the US poverty rate?
The national poverty rate was 11.6% in 2021.
Poverty rates are highest among American Indian or Alaska Native, Black, and Hispanic American populations. In 2021, 24.3% of American Indian or Alaska Native people, 19.5% of Black people, and 17.1% of Hispanic people were classified as living in poverty, followed by 9.3% of Asian Americans and 8.1% of non-Hispanic white Americans.
There are also differences in poverty rates based on education level. Census Bureau data from 2021 showed that 27.2% of people without a high school diploma and 13.2% of people with a high school diploma but no college education were living in poverty. On the other hand, 9.2% of Americans with some college education and only 4.1% of people with a bachelor’s degree or higher were classified as at or below the poverty level.
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Poverty in the United States, 2021
Prior HHS Poverty Guidelines and Federal Register References
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FAQs
Understanding Poverty
What is the definition of poverty in the United States? ›
Poverty is measured in the United States by comparing a person's or family's income to a set poverty threshold or minimum amount of income needed to cover basic needs. People whose income falls under their threshold are considered poor. The U.S. Census Bureau is the government agency in charge of measuring poverty.
How is poverty defined in the US quizlet? ›
In the United States, poverty is measured using the poverty index. The poverty index (or threshold) is a fixed amount that the government has determined as 'adequate' as a set standard of living.
What is the best definition of poverty? ›
poverty, the state of one who lacks a usual or socially acceptable amount of money or material possessions. Poverty is said to exist when people lack the means to satisfy their basic needs. In this context, the identification of poor people first requires a determination of what constitutes basic needs.
What is poverty in one word answer? ›
Poverty is about not having enough money to meet basic needs including food, clothing and shelter. However, poverty is more, much more than just not having enough money. The World Bank Organization describes poverty in this way: “Poverty is hunger. Poverty is lack of shelter.
What is considered U.S. poverty level? ›
Federal Poverty Level (FPL)
| Family size | 2023 income numbers | 2024 income numbers |
|---|
| For individuals | $14,580 | $15,060 |
| For a family of 2 | $19,720 | $20,440 |
| For a family of 3 | $24,860 | $25,820 |
| For a family of 4 | $30,000 | $31,200 |
5 more rowsThe official poverty thresholds do not vary geographically, but they are updated for inflation using Consumer Price Index (CPI-U). The official poverty definition uses money income before taxes and does not include capital gains or noncash benefits (such as public housing, Medicaid, and food stamps).
What is the best way to define poverty? ›
People and families who live in poverty may go without proper housing, clean water, healthy food, and medical attention. Each nation may have its own criteria for determining the poverty line and counting how many of its people live in poverty.
When was the USA's official poverty definition created? ›
As noted below, the thresholds were designated as the Federal Government's official statistical definition of poverty in August 1969.
How does the United States define absolute poverty? ›
Absolute poverty refers to when a person or household does not have the minimum amount of income needed to meet the minimum living requirements needed over an extended period of time. In other words, they cannot meet their basic needs.
Poverty is a state or situation in which a person or a group of people don't have enough money or the basic things they need to live. Poverty means that a person doesn't make enough money from their job to meet their basic needs.
How do they define poverty? ›
Individuals, families and groups in the population can be said to be in poverty when they lack resources to obtain the type of diet, participate in the activities and have the living conditions and amenities which are customary, or at least widely encouraged and approved, in the societies in which they belong.
What term defines poverty? ›
When evaluating poverty in statistics or economics there are two main measures: absolute poverty which compares income against the amount needed to meet basic personal needs, such as food, clothing, and shelter; secondly, relative poverty measures when a person cannot meet a minimum level of living standards, compared ...
What is poverty vs poor? ›
The Oxford dictionary gives the definition of poverty as “the state of being extremely poor” and the definition for poor as “lacking sufficient money to live at a standard considered comfortable or normal in a society”.
What is the best definition of poverty quizlet? ›
state or condition in which a person or community lack the financial resources and essentials to enjoy a minimum standard of life and wellbeing that's acceptable.
What are the poorest of the poor? ›
Women, old people and children are the poorest of the poor in the society. They are systematically denied equal access to the resources available in the family. Hence, they are considered the poorest of the poor.
What qualifies as extreme poverty in the US? ›
The $1.90/day extreme poverty line remains the most widely used metric as it highlights the reality of those in the most severe conditions. Although widely used by most international organizations, it has come under scrutiny due to a variety of factors.
Is it possible for someone to work full time and still be poor? ›
Is it possible for someone to work full time and still be poor? Yes because a poor family is one whose total income is less than the amount required to satisfy the family's minimum cash needs.
What is 400% of the federal poverty level? ›
48 Contiguous States
| Household/ Family Size | 2024 Federal Poverty Level for the 48 Contiguous States (Annual Income) |
|---|
| 100% | 400% |
| 1 | $15,060 | $60,240 |
| 2 | $20,440 | $81,760 |
| 3 | $25,820 | $103,280 |
6 more rowsMar 6, 2024
