Crystal D. Swann
March 8, 2010

The federal government announced that it would follow New York City’s lead and begin producing an experimental measurement of poverty next year, as a first step towards recalculating how poverty is measured in the U.S. In it’s announcement, Administration officials stated that the secondary/companion measurement would take into consideration factors such as food stamps and taxes credits, as well as variations in living costs across metropolitan areas including housing, utility and medical costs.

New York City Mayor Michael Bloomberg, following the recommendations set forth by a National Academy of Sciences’ report, announced in 2008 that New York City would use the Academy’s recommended poverty formula to measure his city’s effectiveness at combating poverty. It was Bloomberg’s hope that the federal government would follow suit and two years later they have.

Many poverty advocates have argued that the current measure of poverty in the U.S., based on a 50 year old formula, was outdated and did not accurate represent the most up-to-date economic framework. New York City is the first city to take on the task of applying the new formula to its policy work. In the analysis conducted by the city, officials found that the impact of public housing and rent subsidies appears to be a more-important determinant to whether a working family is successful in moving out of poverty.

Last year, The U.S. Conference of Mayors issued “Mayors National/Metro Agenda on Poverty” that called on Congress and the Administration to recalculate how poverty is measured in U.S. and to adopt the National Academy of Science’s recommendations. The federal government will release the new supplemental poverty rates next year; however, the original definition will remain the official statistical measure for eligibility and distribution of federal assistance – for now.