The Challenge of Poverty in America

9/8/23

The Department of Human Services is charged with determining what constitutes poverty, which it does for three geographic regions: the 48 contiguous states, Alaska, and Hawaii, respectively. The posted poverty guidelines, as they are called, are used to determine eligibility for federal assistance; and cutoffs differ, depending on this geography and family size. For instance, according to the 2023 guidance, you’re officially poor as a single-person household in one of the 48 contiguous states if your income falls below $14,580. For a family of four in that same area, the poverty line is $30,000. Guidelines are adjusted annually, with inflation and unemployment conditions largely being responsible for changes over time.

So, given this guidance, how are we doing on the poverty front? We look to the Bureau of the Census for that information. The latest count shows that in both 2020 and 2021, about 37.9 million people or roughly 11.6 percent of the population in America lived below the poverty line. Recall, however, that Covid-19 had its initial impact on the economy in March of 2020. In the prior year (2019), the Census put the number of people living in poverty at about 34 million. Thus, at least through 2021, despite Covid-relief efforts and an economy in recovery, the number of people living in poverty rose by around 11 percent.