How is poor defined in the u.s

In , 20 percent of working-age adults living in poverty reported being disabled, 15 percent reported being caregivers, 13 percent reported being students, and 6 percent reported being early retirees. Only 4 percent of working-age adults were labor force nonparticipants who were not disabled, caregivers, students, or early retirees.

Over the past 30 years, a growing share of working-age adults in poverty have been labor force nonparticipants, rising from 42 percent in to 58 percent in These increases have been driven primarily by larger numbers of those with a disability, as well as by students in poverty, and to a lesser extent by early retirees.

While the number of working-age students living in poverty increased dramatically with the onset of the Great Recession, the other labor force nonparticipant classifications have been steadily increasing over a longer time period.

The number of disabled working-age adults in poverty has increased nearly every year, rising from a In contrast, the increase in students in poverty has been a more recent phenomenon. A worsening labor market during the recession may have lowered the opportunity cost of attending school, encouraging people without jobs to enter degree programs. The American Recovery and Reinvestment Act of increased the generosity of Pell Grants and introduced new postsecondary education tax benefits.

Furthermore, as Sarah Turner documented in a Hamilton Project policy proposal, the Departments of Education and Labor sent a guidance letter to states which informed them that unemployment insurance recipients were eligible for Pell Grants, in turn increasing postsecondary enrollment. But, as shown in figure 5, the number of students who are poor has stayed large during the recovery, possibly reflecting a declining share of students who work while in school.

Some students may have other resources, from parents or loans, to support themselves while in school, while others may face material wants. Not surprisingly, the share of labor force participants living in poverty increased overall during the Great Recession, though the number in poverty who were working full-time decreased as part-time work and unemployment increased.

As the unemployment rate doubled, a much larger share of those in poverty were actively seeking employment rising from 3.

In , at the peak of both unemployment and involuntary part-time work, 2. In , , working-age adults were unemployed and living in poverty and 6. Figure 6 describes the reasons given by adults living in poverty for working part-time in the past week as of March This is a different population than those who worked less than full-time year-round in figures 4 and 5.

In there were 6. In March there were 3 million who reported working part-time in the previous week. Looking at why part-time workers were working part-time is of particular interest because working more hours would help to lift many of these workers out of poverty.

Critically, one in three of these workers was working part-time involuntarily. This is the group most likely to be helped by a strengthening economy. Other groups report an inability to work full-time for a variety of reasons specific to their circumstances.

Almost a quarter of part-time workers living in poverty were working part-time because of caregiving responsibilities. One-fifth of part-time workers living in poverty were working part-time while going to school.

Five percent of part-time workers living in poverty were disabled and 2 percent were early retirees. In the past 20 years, growth in the number of part-time workers has been driven both by cyclical factors and other trends. Among the working-age poor, involuntary part-time work spiked during the Great Recession, growing from approximately , in to 2 million in By , this figure had dropped to , with , of that decline coming between and Those who were working part-time and living in poverty due to caregiving responsibilities were the only group that grew in number from to , from approximately , to , To craft effective policies to combat poverty, it is critical to understand the various challenges faced by people living in poverty, and how these challenges have evolved over time.

The decline in the share of children in poverty is a welcome development, but children still represent a large share of those in poverty, and alternative measures of poverty also show millions of children in poverty.

Looking forward, population aging will likely lead more seniors to slip into poverty, even if the share of seniors who are poor continues to fall. The Census Bureau determines poverty status by using an official poverty measure OPM that compares pre-tax cash income against a threshold that is set at three times the cost of a minimum food diet in and adjusted for family size. The OPM uses calculations of these three elements—income, threshold, and family—to estimate what percentage of the population is poor.

In , the most recent year for which data are available, the OPM national poverty rate was There were Income is defined by the OPM to include, before taxes, the following sources:. Poverty thresholds, the minimum income needed to avoid poverty, are updated annually for inflation using the Consumer Price Index , and adjusted for family size, composition, and age of householder. OPM thresholds do not vary geographically. Poverty thresholds serve different purposes, including tracking poverty over time, comparing poverty across different demographic groups, and as the starting point for determining eligibility for a range of federal assistance programs.

To learn more about using the poverty thresholds, or their administrative counterpoint, the poverty guidelines, for determining program eligibility, see FAQ: What are poverty thresholds and poverty guidelines? They were intended to define and quantify poverty in America and to record changes in the number of persons and families in poverty and their characteristics over time.

Family is defined by the OPM as a group of two people or more one of whom is the householder related by birth, marriage, or adoption who reside together. All such people including related subfamily members are considered as members of one family. In , when the official government poverty series began, poverty was estimated at 22 percent.

Before that time, unofficial estimates by researchers found a poverty rate in of 66 percent; 78 percent in ; 32 percent in ; and 24 percent in Figure 1 shows more recent poverty rates, in , , and , by age, race, and Hispanic origin, using the OPM.

Figure 1. Official U. By that measure, the U. In fact, back in , the poverty line for a family of four was about half of median income in the U. One other approach is based on the idea that poverty is more than just a lack of income and should reflect economic insecurity more broadly, such as not having unemployment or health insurance.

It matters because in order to address a problem, you must have a clear understanding of its scope. By using an extremely conservative measurement such as the federal poverty line, the U.

An inaccurate poverty line inevitably also limits the number of impoverished people who qualify for much-needed federal and state assistance. During the COVID pandemic, millions of people would have fallen into poverty were it not for less conditional coronavirus aid from the federal government, such as the three rounds of economic impact checks and supplemental federal employment insurance. Ultimately, poverty will touch the majority of Americans at some point in their lives.

My own research shows that roughly 6 in 10 Americans will spend at least one of their adult years below the official poverty line. But if the U. Festival of Social Science — Aberdeen, Aberdeenshire. Edition: Available editions United Kingdom. Become an author Sign up as a reader Sign in.