Another Way to Calculate Poverty

In Poverty In America, I discussed America’s poverty rate and how it’s calculated. Those calculations result in the Federal Poverty Level (FPL). In 2017, the FPL is as follows.

  • $12,060 for an individual
  • $16,240 for a family of two
  • $20,420 for a family of three
  • $24,600 for a family of four

If you’re a single person living alone, and your income is $12,061, you aren’t considered living in poverty. If you’re a couple and your income is $16,241, you aren’t considered living in poverty. If you’re a family of four and your income is $24,601, you aren’t considered living in poverty.

The United States is a member of a 35-nation membership organization called the Organization for Economic Cooperation and Development (OECD). The OECD uses a definition of poverty that’s based on each country’s median income. The median income is the dividing line between the 50 percent with the highest incomes and the 50 percent with the lowest incomes. According to the OECD, a person is living in poverty if their household income is below 50 percent of their country’s median income.

The Census Bureau reported the median income in the United States for 2015 as $56,516. Fifty percent of that is $28,258.

If the united States used the OECD method for calculating poverty, everyone with a household income less than $28,258 would be living in poverty. Remember, America’s official poverty rate for a family of four is $24,600. That number isn’t counting everyone who earns between $24,600 and $28,258.

For 2013, it was reported that 45.3 million Americans were living in poverty. If the OECD number is used, the total jumps to over 70.6 million.

I’ve used the FPL from 2017 and the median income for 2015 because that’s the data that has been published.

Advertisements

I'd love to hear from you.