7 Key Trends in Poverty in the United States
The U.S. Census Bureau released their annual poverty report, which details the extent and depth of poverty in the United States. The report reveals important variations in poverty over time and across demographics while also providing insight on the causes and effects of poverty for the nation, economy, and federal budget. Below are seven key trends to help understand poverty in the United States.
1. Two primary measures of poverty exist.
There are two primary measures used by the Census Bureau to produce estimates of poverty — the official poverty measure (OPM) and supplemental poverty measure (SPM). While both estimates measure the resources of a family or individual against a poverty threshold, the measures differ in several ways. For example, the OPM is based on pre-tax cash income, whereas the SPM includes both cash and non-cash resources. Therefore, the SPM includes many federal programs designed to aid low-income families. Each estimate also measures the poverty threshold differently — the threshold under the OPM multiplies the cost of a minimum food diet, whereas the SPM considers expenditures for food, clothing, shelter, and utilities. The OPM is used by the federal government to determine eligibility for several programs that aid low-income households, whereas the SPM is often used to assess the effects of government transfers and anti-poverty programs.
2. The poverty rate has varied in the past few years.
In the decade before COVID (2010-2019), poverty gradually fell as measured by both the OPM and SPM. Since the pandemic, however, those two measures have diverged. The OPM rose moderately in the years following the pandemic, from 10.5 percent in 2019 to 11.5 percent in 2020, and has remained elevated since — reaching 11.1 percent in 2023. The SPM, which captures the effects of federal programs like unemployment insurance and stimulus payments, sharply declined during the pandemic, dropping from 11.7 percent in 2019 to 7.8 percent in 2021, as federal relief programs were enhanced or enacted. However, the SPM rose in 2022, jumping to 12.4 percent as much of that aid expired. It continued to rise in 2023 to 12.9 percent and remained at that level in 2024, partially due to an increase in the amount of resources a family or individual needs in order to be considered above the poverty line.
3. Deep poverty affects millions of Americans.
The income-to-poverty ratio helps to better understand how many people live near poverty, as well as the depths of poverty, in the United States. Of the 13 percent of Americans (44 million people) living in poverty in 2024, 33 percent of those people (14 million) lived in deep poverty. Meanwhile, 15 percent of all Americans (51 million) lived just above the poverty line at 100 percent to 149 percent of the poverty threshold.
4. Poverty is not experienced equally.
While poverty rates for Black, Hispanic, and American Indian and Native Alaskan Americans are lower today than they were over a decade ago, the share of such individuals in poverty remains well above the average compared to other groups. The increased SPM for Black Americans is statistically significant compared to last year, increasing from 18.5 percent in 2023 to 20.7 percent in 2024. The poverty rates for other groups did not change significantly from 2023 to 2024.
5. The poverty rate among children declined in 2024.
The SPM among children was at its lowest recorded level in 2021 largely due to COVID-19 relief that increased resources for families with children, such as the stimulus payments and the enhanced child tax credits. The expiration of that aid contributed to the spike in the SPM among children, which climbed from 5.2 percent in 2021 to 13.7 percent in 2023; it declined marginally in 2024 to 13.4 percent. Meanwhile, the official poverty rate for children under 18 — which does not account for that federal relief in its calculation — was relatively stable during the pandemic and decreased a whole percentage point from 2023 to 2024.
6. Poverty is unequally distributed by region.
Poverty also varies depending on geographic region. Maine had the lowest SPM at 6.7 percent while California and Louisiana had the highest poverty rates of 17.7 percent. When categorized by geographic region, the Midwest and the Northeast had the lowest percentage of people living in poverty (9.8 percent) whereas the West and South had higher rates of people living in poverty (11.0 percent and 12.4 percent, respectively). See how income also varies across region.
7. Social Security moved 29 million individuals out of poverty in 2024.
Social Security was the most effective anti-poverty program in 2024, lifting approximately 29 million people out of poverty. Refundable tax credits, which include the earned income tax credit and refundable portion of the child tax credit, were the second-most effective anti-poverty program, shifting 6.8 million people away from poverty. However, medical expenses and payments associated with the Federal Insurance Contribution Act — a payroll tax — brought 7.5 million and 4.5 million people into poverty, respectively.
Conclusion
Poverty remains a significant structural challenge in America. As the United States continues to face global challenges, understanding the nature of poverty will be essential to identify the most efficient use of federal dollars for anti-poverty programs and initiatives that will help raise up more Americans out of poverty and, in turn, support broadly shared economic growth for the future.
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