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25 Facts of Life the Federal Poverty Rate Completely Ignores

24/7 Wall St. Logo By Michael B. Sauter of 24/7 Wall St. | Slide 1 of 26: According to the official federal rate, 13.1% of Americans live in poverty. This measure, however, was developed in 1963 and is considered today a crude and controversial representation of economic insecurity in the United States. 
The official poverty rate is based on pre-tax income thresholds derived from the cost of a minimum food diet and the number of individuals who depend on that income. But the measure fails to include different kinds of basic sources of wealth and expenses, and it does not consider regional differences in costs, which can be extreme from one part of the country to another. 
It also fails to count millions and millions of Americans at all, including those living in prisons, in military barracks, and more. It does not even count the poorest demographic in the country — the nation’s homeless population. These are the states with the most unsheltered homeless people. 
The Census Bureau also releases another measure of poverty, the supplemental poverty measure, which includes some of the components left out by the official measure -- but not everything. Based on the differences between the official poverty rate and the supplemental poverty rate, these are the 15 states where poverty is worse than you might think.
24/7 Wall St. reviewed U.S. Census Bureau documentation to list 25 groups, expenses, sources of income, and more that the official poverty rate does not measure.

Editor's note: This holiday season, Microsoft News is focusing on the issue of poverty and its effects around all of us. A closer look at income inequality reveals that in today’s world of unaffordable housing, crippling college debt, climate change and other forms of marginalization, traditional stereotypes and assumptions about who lives in poverty no longer apply. As part of this project, we are proud to support the work of Feeding America to address the immediate needs of people who are struggling, as well as the root causes. Please consider making a donation today

According to the official federal rate, 13.1% of Americans live in poverty. This measure, however, was developed in 1963 and is considered today a crude and controversial representation of economic insecurity in the United States. 

The official poverty rate is based on pre-tax income thresholds derived from the cost of a minimum food diet and the number of individuals who depend on that income. But the measure fails to include different kinds of basic sources of wealth and expenses, and it does not consider regional differences in costs, which can be extreme from one part of the country to another. 

It also fails to count millions and millions of Americans at all, including those living in prisons, in military barracks, and more. It does not even count the poorest demographic in the country — the nation’s homeless population. These are the states with the most unsheltered homeless people

The Census Bureau also releases another measure of poverty, the supplemental poverty measure, which includes some of the components left out by the official measure – but not everything. Based on the differences between the official poverty rate and the supplemental poverty rate,these are the 15 states where poverty is worse than you might think.

24/7 Wall St. reviewed U.S. Census Bureau documentation to list 25 groups, expenses, sources of income, and more that the official poverty rate does not measure.

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