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New Poverty Measures to be Developed

The Commerce Department yesterday outlined plans for a new methodology for measuring the poverty rate [“Census Bureau to Develop Supplemental Poverty Measure”].  The new measure will not replace the existing poverty-rate calculation, but serve as a supplement:  “the supplemental measure will not be the measure used to estimate eligibility for government programs. Instead, it will be an additional macroeconomic statistic, providing further understanding of economic conditions and trends.”

As reported in a previous article on the Arkansas Economist, intensive research on new measures of poverty has been underway for many years.  The new measure will incorporate many of the changes that have been recommended by researchers, including the adjustment of poverty measures for differences in the cost of living across geographic areas. 

Final details about the new measure are still being worked out — it will not be available until the fall of 2011 (when the poverty statistics for 2010 are released). 

To see how differences in cost-of-living affect Arkansas’ rankings in the poverty statistics, see my previous post on the topic:  “The Poverty Rate and the Cost of Living.”