Federal Housing Subsidies and other Assistance Programs Reduce Poverty
Oct 13, 2015
The U.S. Census Bureau released the 2014 Supplemental Poverty Measure (SPM) in September. The SPM indicates that federal housing subsidies lower poverty by 0.9 percentage points and lifts approximately 2.8 million people out of poverty.
The SPM was developed to address shortcomings of the official poverty measure, which excludes non-cash government benefits from income. The SPM takes into account benefits like housing subsidies, the Supplemental Nutrition Assistance Program (SNAP), and the Earned Income Tax Credit (EITC) when calculating income. The SPM also deducts certain necessary expenses from income, such as taxes, out-of-pocket medical costs, work-related expenses, and child care.
The SPM shows that housing subsidies such as public housing and vouchers reduce poverty by 1.2 percentage points for children under 18 and seniors 65 years and older, and by 0.7 percentage points for adults 18 to 64 years of age. The following table provides poverty rates by age, using the SPM, and the poverty rate if a specific benefit is eliminated:
|
Under 18 Years of Age |
18 to 64 Years of Age |
65+ Years of Age |
|
|
SPM Poverty Rate |
16.7% |
15.0% |
14.4% |
|
SPM Poverty Rate without: |
|||
|
Social Security |
18.9% |
19.1% |
50.0% |
|
Refundable tax credits |
23.8% |
17.2% |
14.6% |
|
SNAP |
19.5% |
16.2% |
15.1% |
|
Unemployment insurance |
17.1% |
15.3% |
14.5% |
|
SSI |
17.6% |
16.3% |
15.8% |
|
Housing subsidies |
17.9% |
15.7% |
15.6% |
|
School lunch |
17.8% |
15.3% |
14.4% |
|
TANF |
17.2% |
15.2% |
14.5% |
|
WIC |
17.0% |
15.1% |
14.4% |
|
LIHEAP |
16.8% |
15.0% |
14.5% |
Source: Short, Kathleen (2015). The Supplemental Poverty Measure: 2014. United States Census, U.S. Department of Commerce.
The Supplemental Poverty Measure: 2014 is available at http://1.usa.gov/1MbOyKR.