Difference Between the Supplemental and Official Poverty Measures

There has been continued debate about the best way to measure poverty in the United States since the first official U.S. poverty statistics were published in the mid-1960s. The U.S. Census Bureau releases two poverty measures each September. The first, called the official poverty measure, is based on cash resources. The second, the Supplemental Poverty Measure (SPM), includes both cash and noncash benefits and subtracts necessary expenses (such as taxes and medical expenses). The official poverty measure has remained mostly unchanged since it was introduced in the mid-1960s. In contrast, the SPM was designed to improve as new data and methods become available. This blog discusses the development of the SPM and differences between the two measures.

In 2010, an interagency technical working group (ITWG) asked the Census Bureau and the U.S. Bureau of Labor Statistics (BLS) to develop a new measure designed to improve our understanding of the economic well-being of American families and enhance our ability to measure the effect of federal policies on those living in poverty. The result was the SPM, which draws on the recommendations of a 1995 National Academy of Sciences report and research conducted over the following decades. (Refer to the history of poverty measures in the United States infographic for more details.)

In 2016, a new ITWG was formed to review and implement potential SPM methodological improvements. The working group prioritized consistency between threshold and resource definitions, data availability, simplicity in estimation, stability of the measure over time, and ease in explaining the methodology when considering potential improvements to the SPM. In September 2020, this working group voted to implement several improvements. Details regarding these improvements are available at Improvements to the Census Bureau's Supplemental Poverty Measure for 2021.

In 2020, the Census Bureau commissioned the National Academies' Committee on National Statistics to convene a panel to evaluate the SPM and offer recommendations to improve the measure. The expert panel produced a consensus report, "An Updated Measure of Poverty: (Re) Drawing the Line," in April 2023 that outlined key areas for the Census Bureau and BLS to research in the coming years. The Census Bureau will continue to work with BLS and the current ITWG on the SPM to determine the feasibility and timeline of any potential improvements to the SPM in the future.

On September 10, the Census Bureau is set to release the report, Poverty in the United States: 2023. The report will include data for 2022 and 2023, and present estimates of both the official poverty measure and SPM and outlines differences between them. For a detailed comparison of major concepts, refer to the table below and the "How the Census Bureau Measures Poverty " infographic.