Brief Report: Measuring Poverty in the United States from 1967 to 2024
This report analyzes U.S. poverty trends from 1967 to 2024 using Supplemental and relative poverty measures, finding that while government policies have driven a significant decline in income poverty and reduced demographic gaps, the relative poverty rate has modestly increased despite decades of economic growth.
Original paper licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer
To understand how well a society is doing, economists and policymakers often look at a single, vital number: the poverty rate. This figure represents the percentage of people whose income falls below a specific line, a threshold meant to mark the point where a family cannot afford the basic necessities of life like food, clothing, and shelter. For decades, the United States relied on an "official" way of drawing this line, a method created in the 1960s that adjusted only for rising prices but did not account for how the cost of living or the standard of living had changed for everyone else. Critics argued this old method was too rigid, failing to capture the reality of modern life, such as the cost of childcare or medical bills, or the help families receive from government programs like tax credits and food assistance. In response, experts developed a newer, more flexible tool called the Supplemental Poverty Measure. This updated approach paints a fuller picture by counting not just cash income, but also the value of government aid and subtracting necessary expenses, while also adjusting the poverty line based on what people actually spend on essentials in different parts of the country. Tracking these numbers over time is crucial because it reveals whether the economy is truly lifting people up or if the safety net is merely holding them in place.
A team of researchers from Columbia University and the U.S. Census Bureau recently took a deep dive into this question, extending a long-term study of American poverty all the way from 1967 to 2024. By using historical data to apply the modern Supplemental Poverty Measure to the past, they were able to see how the story of American economic hardship has changed over more than five decades. Their work reveals a tale of two different realities, depending on how you choose to measure them. When they used the modern, comprehensive Supplemental Poverty Measure, they found that poverty in the United States has dropped significantly, falling from 18.5 percent in 1967 to 12.9 percent in 2024. This represents a decline of about one-third, a substantial improvement in the economic well-being of the population. However, the researchers discovered that this progress is almost entirely the result of government policies and programs. If you were to remove the effects of Social Security, tax credits, food assistance, and other government aid from the calculation, the poverty rate would not have fallen at all; in fact, without these interventions, the rate in 2024 would have been slightly higher than it was in 1967. For the entire period studied, the poverty rate without government help never dipped below 20 percent, meaning that despite decades of economic growth, more than one in five Americans would have been poor without the support of public policy.
The researchers also explored what the story looks like if they used a different kind of measurement, one that is common in other wealthy nations. Instead of a fixed line that moves with prices, this "relative" measure defines poverty as having an income below half of the median household income in that year. This approach asks a different question: are people falling further behind the rest of society, even if their basic needs are met? Under this lens, the long-term trend looks quite different. Rather than declining, relative poverty actually increased modestly, rising from 15.1 percent in 1967 to 18.2 percent in 2024. Without government programs, this rise would have been even steeper, climbing to over 26 percent. This suggests that while government policies have successfully kept millions of people above the absolute line of poverty, they have not fully prevented a growing gap between the poorest families and the average American household. The policies act as a buffer, softening the blow of economic shifts, but they have not reversed the underlying trend of increasing inequality.
Beyond the overall numbers, the study offers a detailed look at how these trends have played out for different groups of people. The decline in poverty measured by the modern standard has been driven largely by improvements for older adults and children. The poverty rate for those over 65 dropped by 60 percent, and the rate for children under 18 fell by more than a third. This has led to a situation where the economic hardship faced by the very young and the very old is now much closer to that of working-age adults, a significant equalization compared to the past. When looking at sex, the gap between men and women has narrowed, with women seeing a larger percentage drop in poverty rates than men. The picture is more complex when examining race and ethnicity. While poverty rates have fallen for all groups, significant disparities remain. The poverty rate for Black individuals, for instance, has fallen by more than half since the early 1970s, yet it remains more than double the rate for White individuals in 2024. Similarly, while gaps have narrowed for Hispanic, Asian, and American Indian populations, these groups still experience higher rates of poverty than White Americans.
The researchers acknowledge that their work has limits. Their data comes from household surveys, which means they cannot capture the experiences of people who are incarcerated, homeless, or undocumented, groups that are often the most vulnerable. They also note that income is just one way to measure economic struggle; some experts prefer to look at what people actually buy or whether they can afford specific goods. Despite these limitations, the study provides a clear and rigorous look at how the United States has fared over the last half-century. The findings confirm that government policies have been the primary engine driving the reduction of poverty, lifting millions of families out of destitution. At the same time, the study highlights that the choice of measurement matters deeply. Whether one sees a story of great progress or a story of growing inequality depends on whether the focus is on meeting basic needs or on keeping pace with the rest of society. Both stories are true, and both are essential for understanding the full scope of economic life in America today.
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