Percentage of People in Poverty, Using the Alternative Poverty Measure, 1967-2012

09/15/2015

Percentage of People in Poverty, Using the Alternative Poverty Measure, 1967-2012


Percentage of People in Poverty, Using the Alternative Poverty Measure, 1967-2012

YearAlternative Poverty MeasureAlternative Poverty Measure without Transfers
196725.6%26.9%
196823.7%25.4%
196922.4%23.9%
197022.1%24.8%
197122.0%26.4%
197220.5%25.4%
197319.2%24.8%
197420.1%26.2%
197519.4%26.8%
197618.9%25.9%
197718.7%25.4%
197818.0%24.4%
197917.7%24.1%
198019.4%25.6%
198120.6%26.7%
198221.7%28.0%
198322.1%28.1%
198421.1%26.4%
198520.7%26.2%
198620.1%25.3%
198719.0%24.3%
198818.9%24.4%
198918.6%24.2%
199019.3%24.7%
199119.4%26.1%
199219.8%26.8%
199320.7%27.7%
199419.5%27.1%
199517.7%25.9%
199617.5%25.6%
199716.6%24.9%
199815.5%23.7%
199914.9%22.9%
200014.4%22.0%
200114.9%22.9%
200215.1%23.7%
200315.3%24.3%
200414.9%24.3%
200514.9%24.0%
200614.6%23.4%
200714.7%23.6%
200814.6%25.3%
200914.7%27.5%
201015.3%28.1%
201115.5%28.4%
201216.0%28.7%

The figure above presents alternative poverty trends, first based on the actual definition of resources (the solid line) and then excluding safety net resources (dotted line). The role of transfers is clearly pronounced during the recent Great Recession. Without taxes and transfers, poverty would have risen from 23.6 percent to 28.7 percent (5.1 percentage points) between 2007 and 2012. Instead, poverty only rose from 14.7 percent to 16.0 percent (1.3 percentage points) during the same period.

In 1967, government policies and programs reduced alternative poverty rates by 1.3 percentage points, from 26.9 percent to 25.6 percent.

By 2012, government policies and programs reduced alternative poverty rates by 12.7 percentage points, from 28.7 percent to 16.0 percent. This amounts to nearly 40 million people lifted out of poverty.

The magnitude of the effects of taxes and transfers on reducing alternative poverty rates increased markedly over the past 50 years with poverty reduction impacts ten times larger in 2012 than in 1967.

 

Note: Transfers include SNAP, housing subsidies, school lunch, LIHEAP, WIC, EITC and stimulus payments, cash welfare, SSI, Social Security, unemployment insurance, worker’s compensation, and veteran’s payments.

Source: Calculations by ASPE based on the Current Population Survey, as augmented by the Columbia Population Research Center, 1968 to 2013 (see Fox et al 2015).