The Division of Price and Index Number Research (DPINR), U.S. Bureau of Labor Statistics (BLS), published the 2022 Research Supplemental Poverty Measure (SPM) thresholds on September 7th, 2023. These thresholds incorporate the changes approved by the ITWG SPM on September 30, 2020. The changes are described on the main DPINR SPM webpage. SPM thresholds are used by the Census Bureau in combination with SPM resources to produce SPM poverty statistics. The SPM is meant to provide a complementary perspective for examining poverty and is not designed to replace the official poverty measure. Both SPM and official poverty statistics are produced by the Census Bureau.
As seen in Chart 1, the 2022 SPM thresholds for consumer units with two adults and two children are $34,235 for owners with mortgages, $28,909 for owners without mortgages, and $34,518 for renters, as compared to the official poverty threshold of $29,678 (for two adults two children). The thresholds for owners with mortgages and renters are not significantly different. In contrast, the thresholds for owners with mortgages are statistically significantly different from those for owners without mortgages (at the 0.1 percent level). Thresholds for owners without are also statistically significantly different than those for renters at the same level.
Chart 2 includes the 2022 SPM thresholds along with those from 2021 for comparison. As shown in Chart 2, the 2022 SPM thresholds are higher than those for 2021. When compared in threshold year dollars, the thresholds for 2022 are statistically significantly different than those for 2021 at the 0.1 percent level for owners with mortgages, owners without mortgages, and renters. Although it is typical for the thresholds to significantly increase from year-to-year, the between 9.74 percent increase for renters and 10.05 percent increase for owners without mortgages is unusually large.
The SPM is a work in progress and is expected to incorporate improvements over time, like those introduced with the production of the 2019 (revised) and 2020 thresholds, published in September 2021. The 2022 SPM thresholds are derived using the same methodology and computer code as for the 2021 SPM thresholds with a few exceptions related to the production of imputed in-kind benefits. These changes were approved by the ITWG in March 2023. The first three changes listed below were made such that the production of the thresholds would be consistent with the methods used by the Census Bureau to produce SPM resources. The last two changes are unique to the thresholds and not relevant to the production of SPM resources. The fourth change was implemented to ensure WIC benefits were not double counted, and the fifth changes accounts for cases where a consumer unit may have moved during the three month reference period.
Analysis of the change (PDF) provides an explanation as to why the 2022 SPM threshold increased so much more than in previous years. Three factors are identified as contributors to the change: prices, updating the data used to produce the thresholds, and improvements to the methodology to impute in-kind benefits. The impact of improving the in-kind benefits imputation methodology and updating the data account for between 2.54 percentage points for renters and 2.85 percentage points for owners with mortgages. In contrast, inflation account for 7.21 percentage points of the increase. The overwhelming contribution of inflation to the increase in the thresholds is not a surprise given the year-over-year inflation rate for 2022 was considerably higher compared to previous years.
Last Modified Date: September 7, 2023