Poverty rates spike in 2022
San José, CA – On Tuesday, September 12, the U.S. Census Bureau reported on income, poverty and health insurance coverage in 2022. The report on poverty was dire, with the poverty rate as measured by the Supplemental Poverty Measure, or SPM, jumping almost 60% between 2021 and 2022.
The SPM was developed by the Census Bureau to try to correct some of the shortcomings of the official poverty rate that was developed in the 1960s. The SPM includes the cost of non-food necessities such as housing and childcare, includes a broader range of income sources, and, very importantly, adjusts for local costs of living.
For example, using the official poverty measure, poverty in California is a bit more than the average among states, but using the SPM, which takes into account the high cost of living in California, the state actually has the highest rate of poverty of all states. This is better aligned with the high rate of homelessness here.
Hardest hit by the rise in poverty were children, whose poverty rate more than doubled, with an increase of almost 140%, going from 5.2% in 2021 to 12.4% in 2022. Women and Native Americans also saw very large increases in their rates of poverty, rising 93% and 87%, respectively.
Despite the low and falling unemployment rate in 2022, poverty rose with the end of pandemic-era federal government aid, especially the end of the expanded child tax credit for low-income parents. These cuts are continuing this year, as people will be losing their Medicaid health insurance and the student loan payments and interest resume. Poverty and hardship are likely to keep rising.