Housing Subsidies Lift 2.9 Million Out of Poverty

The U.S. Census Bureau released two annual reports on income and poverty on September 12. Income and Poverty in the United State: 2017 shows that median household income was $61,400, a 1.8% increase from 2016. The poverty rate was 12.3% in 2017, down from 12.7% in 2016. The Supplemental Poverty Measure: 2017 shows that housing subsidies lifted 2.9 million people out of poverty.

Although household incomes at the 50th, 90th, and 95th percentiles increased by 1.8%, 2.8%, and 3% respectively, there was not a statistically significant change in income for the lowest income households at the 10th percentile. Income gains also varied by race and ethnicity. The real median incomes of non-Hispanic White and Hispanic-origin households increased 2.6% and 3.7% respectively, while the real median incomes of Black and Asian households were not statistically different from 2016.

While the poverty rate decreased between 2016 and 2017, significant racial and ethnic disparities persisted. In 2017, the poverty rate was 8.3% for non-Hispanic whites, 18.3% for Hispanics, 10.0% for Asians, and 21.2% for Blacks. In addition, 5.7% of the population was in extreme poverty, with income below 50% of the poverty threshold.

The Census Bureau’s Supplemental Poverty Measure (SPM) addresses the shortcomings of the official poverty measure, which excludes non-cash government benefits from household income. The SPM takes into account non-cash benefits for low income households such as housing subsidies, the Supplemental Nutrition Assistance Program (SNAP), the National School Lunch Program, the Supplementary Nutrition Program for Women, Infants, and Children (WIC), and the Low Income Home Energy Assistance Program (LIHEAP). The SPM also subtracts necessary expenses from household income, such as child care, medical, and work-related expenses. The supplemental poverty rate of 13.9% in 2017 was not statistically different from the 2016 rate, indicating no apparent change in poverty when using a more nuanced measure.

The SPM also shows that housing subsidies lifted 2.9 million people out of poverty. Housing subsidies reduced the supplemental poverty rate by 1.2 percentage points for children under 18, 0.7 percentage points for adults 18-64, and 1.3 percentage points for seniors 65 and older.

Income and Poverty in the United States: 2017 is available at: https://bit.ly/2CNq5im

The Supplemental Poverty Measure:2017 is available at: https://bit.ly/2COfSCp