Any time data are collected there is a time lag before it is publicly released. Sometimes the lag is short—unemployment data are released just a month or two after being collected—and other times the lag is longer—poverty estimates are generally released about 9 months into the next year after they are collected. The Report on Illinois Poverty and this website use the most timely data sources available for the types of geographies and comparisons we make, and at the time they are released, they are the most accurate available (sometimes sources go back and correct errors).
There are a number of sources that provide poverty estimates. These sources each differ slightly in regards to the geographies they have estimates for and the time period they reference. The data source we use for any given purpose is driven, among other things, by whether we need comparable data for all counties in Illinois or not. The American Community Survey, which surveys a sample of the entire population, is the preferred data source for sub-national estimates of poverty. This is the source used for the vast majority of poverty estimates in the Report on Illinois Poverty, including estimates for the Chicago region counties. However, single-year estimates are not available for counties with populations below 65,000. So we must use another source, the Small Area Income and Poverty Estimates program, which uses data collected as part of the ACS and combines it with other data sources, like tax information, food stamp usage, and decennial census data to generate comparable poverty and income estimates for all counties.
To learn more about various sources of poverty estimates, visit: http://www.census.gov/hhes/www/poverty/about/datasources/description.html
The most current poverty estimates reflect the year 2018. Poverty is measured in terms of percentages of the federal poverty level (FPL): 100% FPL is the poverty threshold, 50% FPL is half the poverty threshold, and 200% is twice the poverty threshold. The federal poverty thresholds in 2018 were:
Calculating poverty estimates involves tallying up a family’s annual income and determining if the amount falls below the poverty threshold for the family’s size. If the annual income does fall below the threshold, then the family and every individual in it is considered to be in poverty. Non-relatives, such as housemates, do not count. The official poverty thresholds do not vary geographically and are updated each year for inflation.
Money income used to compute poverty status includes the following (before taxes; noncash benefits and capital gains/losses do not count): earnings, unemployment compensation, workers’ compensation, Social Security, Supplemental Security Income, public assistance, veterans’ payments, survivor benefits, pension or retirement income, interest, dividends, rents, royalties, income from estates and trusts, educational assistance, alimony, child support assistance from outside the household, and other miscellaneous sources.
The poverty measure is outdated and is generally agreed to understate the degree of actual material deprivation. The federal poverty threshold was established in the 1960s using 1955 food costs as its basis. Since then, food costs consume much less of a family’s budget than they did half a century ago and other costs have ballooned, such as health care and housing. The result is a measure that is not in any way an indication of what families need to get by since it is not based on a market basket of all basic needs and its methodology is “frozen.” Instead, it is a measure of severe income deprivation. Many experts agree that it takes an income of around two to three times the poverty line to pay for a family’s most basic expenses.
As a longitudinal measure, the poverty measure has some value. However, there are other pitfalls of the federal poverty measure that have made it decline in usefulness as a true measure of hardship. First, the measure assumes a one-worker family with a stay-at-home mom, which is no longer the norm. So certain costs are left out (i.e., child care). Second, the FPL does not vary based on the cost of living in different places of the country. Finally, the FPL does not include some income (in-kind benefits) and does not capture the impact of work supports, making it difficult to get a true picture of how families are helped by such programs.
The County Well-Being Index, created by the Social IMPACT Research Center, highlights counties that are experiencing particularly negative conditions and trends on four key indicators: poverty, unemployment, teen births, and high school graduation. The counties are evaluated using a point system, with a higher number of points indicating a worse score. A county receives a point if its rate is worse than the state average and/or if it has worsened since the previous year, for a total of 8 possible points.
Counties on the Poverty Watch list have a score of 4 or 5 and need to be monitored by local leadership, while counties on the Poverty Warning list have a score of 6, 7, or 8 and need to initiate corrective action (such as adequately funding education, quality job creation, and human services).
On November 7, 2011, the U.S. Census Bureau released the Research Supplemental Poverty Measure (SPM), developed based on recommendations from the National Academy of Sciences (NAS) Panel on Poverty and Family Assistance. The Supplemental Poverty Measure is an effort to build on the current federal poverty measure—which many experts agree is outdated and underestimates poverty—and take into account the impact of government benefit programs and tax credits to obtain an improved understanding of the economic well-being of American families and of how federal policies affect those living in poverty.
To learn more about the Supplemental Poverty Measure, visit: http://www.census.gov/hhes/povmeas/methodology/supplemental/research.html
Good data should be the backbone of all decision making. Many different audiences use the Report on Illinois Poverty to understand poverty in their communities. Funders use it to make wise investments, services providers use it to gain deeper (or more current) insights into their target populations, legislators use it to influence legislative decisions, and local leaders use it to prioritize poverty-related issues in their planning.
During the 2008 Illinois legislative session, the From Poverty to Opportunity Campaign, coordinated by Heartland Alliance, advocated for the creation of the Commission on the Elimination of Poverty—the country’s first commission on ending poverty consistent with international human rights standards. The Commission is comprised of elected officials, leaders from a variety of social service, business, and other sectors, as well as people experiencing poverty.
To learn more about the Illinois Commission on the Elimination of Poverty, visit: http://www2.illinois.gov/poverty/Pages/default.aspx
The Social IMPACT Research Center is a program of Heartland Alliance, one of the world’s leading anti-poverty organizations. IMPACT does research that helps leaders create change. We collaborate with clients to measure and grow their social impact. Our user-friendly work enables nonprofits, foundations, and governments to advance real-world solutions to poverty. To learn more, visit www.socialimpactresearchcenter.org, follow us on Twitter @HeartlandPolicy
Learn about our Data Services and Subscriptions and submit a request here: https://readi.test/research/services/
