Is the official US poverty measure still based on a 1960s formula? | Fact brief

The United States’ official poverty measure is still based on a formula developed in the 1960s, although its dollar thresholds are updated annually for inflation.

The measure was developed in the mid-1960s by Mollie Orshansky, a staff economist at the Social Security Administration. Poverty thresholds were derived from the cost of a “minimum food diet,” multiplied by three to account for other expenses.

The thresholds don’t vary geographically but are updated for inflation using the Consumer Price Index. The official measure uses pretax income and does not include capital gains or noncash benefits.

In 2011, the Census Bureau introduced the Supplemental Poverty Measure; unlike the official measure, it accounts for taxes, benefits, medical expenses and geographic housing costs.

Maine’s 2024 official poverty rate was 10.6%, matching the U.S. rate. 

Maine’s 2022-24 average supplemental rate was 6.7%, the nation’s lowest. The comparable U.S. rate was 12.7%.