The Commerce Department’s U.S. Census Bureau is preparing to develop a Supplemental Poverty Measure that will use the best new data and methodologies to obtain an improved understanding of the economic well-being of American families and of how federal policies affect those living in poverty. The initiative to create the new statistic is included in the President’s FY2011 budget proposal.
The official poverty measure, which has been in use since the 1960s, largely estimates poverty rates by looking at a family’s or an individual’s cash income. It will remain the definitive statistical measure.
The supplemental measure will be a more complex and refined statistic, including such additional items as tax payments and work expenses in estimating family resources. Unlike the official administrative measure, the supplemental measure will not be the measure used to estimate eligibility for government programs. Instead, it will be an additional macroeconomic statistic, providing further understanding of economic conditions and trends.
