How we measure poverty matters: Data to support thriving children and families

Most Americans would agree that every child needs and deserves to have their basic needs met to thrive and reach their full potential. That means growing up in a supportive family, with enough healthy food, a safe home, access to health care, and a stable community.

To ensure we’re meeting children’s needs, we need accurate and detailed information about families’ overall economic health—or lack thereof. We need reliable data to measure poverty—to see the full picture of how income, expenses, and the impact of public programs and policies affect parents’ ability to meet the basic needs of their children.

The official measure of poverty doesn’t capture the full picture

The federal government uses two measures of poverty. The Official Poverty Measure (OPM) is based on whether a family’s income is lower than the government’s poverty threshold, a dollar amount considered the minimum required to meet basic needs, adjusted annually and for the number of people in a household. It does not take into account geographic location, the full cost of living, or basic expenses like child care and housing.

The Supplemental Poverty Measure (SPM) reflects not only income but also today’s living costs and expenses, such as food, housing, utilities, and clothing, as well as the effect of public programs on families’ financial well-being. Poverty is multifaceted, requiring a nuanced understanding of families’ needs and whether they have the resources to effectively address them. The SPM data tells us that while government policies reduce child poverty, they’re still insufficient to fully meet the needs of all children.

Government programs are critical to reducing poverty

Over decades of tracking child well-being, the Annie E. Casey Foundation has identified reliable data as essential to effective action. The SPM’s detailed information allows us to see where programs succeed and where gaps remain to inform our mission to ensure that every child can have a real chance to thrive. In our report, Measuring Access to Opportunity in the United States: A 10-Year Update, we analyzed the role of government programs in reducing poverty and whether incomes have kept pace with rising costs.

In 2024, 13% of U.S. children lived in poverty, according to the SPM, nearly triple the percentage in 2021, when pandemic-era supports including the expanded Child Tax Credit (CTC) reduced child poverty to a historic low of 5%. Crucially, the SPM suggests that 25% of children—almost double the percentage—would live in poverty without existing programs, such as the CTC, Earned Income Tax Credit, Supplemental Nutrition Assistance Program, and housing subsidies. These programs play a vital role in reducing hardship.

But while government policies lift millions of families out of poverty, two key statistics indicate that rising costs are outstripping wages and the support offered by these programs. Among children living in poverty, 61% live in families with at least one working parent. And in 2024, the SPM rate was 12.9%, more than 2 percentage points higher than the official poverty rate of 10.6%. Parents are doing their part to make ends meet and provide for their children. They need wages and benefits that keep up with costs, as well as affordable child care, housing, and health care to ensure that work leads to economic stability.

Data helps tell the story of children’s lives

The data does more than measure poverty statistics—they tell the story of children’s lives and what it will take to improve them. Children in poverty face increased risk of poor health, limited employment prospects, and barriers to educational, financial, and housing opportunities—all of which can prevent them from reaching their potential and undermine their long-term well-being.

While government programs are crucial to reducing poverty, the numbers also reveal their limitations in eradicating it. Collaboration across the public, philanthropic, and business sectors with communities to create access to stable jobs with family-sustaining wages could have greater impact. Opportunities for education and training for parents could help them advance on a career path, increase earnings, and better confront the rising costs of essential goods and services.

Certainly, the private and philanthropic sectors have a role to play, but they’re not a substitute for wages and benefits such as paid leave, health insurance, and retirement plans. Philanthropy can help highlight the evidence for solutions and provide seed capital for innovation, but it can’t duplicate the reach and scale of child- and family-oriented policies and programs.

We need accurate national- and state-level data to measure poverty so policy makers, businesses, philanthropies, and community organizations operate from a shared understanding of how children are doing and where there are gaps. With data, we can develop actionable plans to drive meaningful change. Only then can we ensure that every child in America has what they need not just to survive, but to thrive.

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