ERS's Legacy of Poverty Area Measurement
Federal initiatives focusing on regional development as a means of poverty area alleviation expanded following the late 1950s with an awareness that poverty remained high for certain places and population groups while the nation as a whole prospered. This concern fueled many 'War on Poverty' era (1964–68) initiatives and subsequent need for spatial information on poverty conditions, which led to the commissioning of poverty area research. The President’s National Advisory Commission on Rural Poverty was established in September 1966 by Executive order to study poverty conditions in rural areas, examine existing policies and programs, and make recommendations for action. As part of that effort, the study of rural poverty areas was tasked to the USDA, Economic Research Service (ERS).
Early ERS Poverty Area Measures
There was no single established method to identify poverty areas in the mid-1960s. However, earlier in the decade, ERS researchers developed poverty area methodologies for identifying the extent and persistence of poverty in rural areas. These methodologies consisted of relative composite indices, which aggregate multiple variables into a single numeral value that can be used to determine an area’s position from the lowest to highest levels of economic well-being in society. For instance, if an area was positioned in the lowest quartile of index scores, it was categorized as a poverty area. Such indices serve to capture the complexity and persistence of poverty by highlighting additional deprivations experienced by area residents. Some additional measures include measures of income, population age structure, housing conditions, employment status, and educational attainment. USDA, ERS built on this work by contributing to the Rural Commission report, The People Left Behind, A Report by the President's National Advisory Commission on Rural Poverty (1967) and research volume, Rural Poverty in the United States (1968). In those publications, rural poverty areas were reported at the county level.
Rural Poverty Data Challenges
ERS researchers continued to use a relative index approach for county-level poverty area measurement until the early 1980s, exploring composite and unidimensional indices of economic well-being. Two factors primarily contributed to the continuation of this approach. The first was the lack of a nationwide poverty measure. An official Federal poverty measure was adopted in 1969, and widespread use of the Official Poverty Measure (OPM) was adopted nearly a decade later after the Office of Management and Budget issued a statistical policy directive in 1978 specifying its use by all executive departments and establishments for statistical purposes. The sole data source available for long-term analysis with substate geography was the Decennial Census. The pre-1960 decades did not include OPM and the county was the lowest geographic unit for nationwide coverage.
ERS’s Persistent Poverty Area Classification
In 1985, ERS published the first formal classification of persistent poverty areas released by a Federal agency, based on the characteristics of current (1979) OMB designated nonmetropolitan counties. For more information from earlier publications, see
- The Diverse Social and Economic Structure of Nonmetropolitan America (Rural Development Research Report No. 49, September 1985).
Adoption of a Revised Classification
In 1994, ERS published a revised version of the 1979 county classification. See
- The Revised ERS County Typology: An Overview (Rural Development Research Report No. 89, December 1994).
This revision reflected the need for consistency with observed changes in the economy and Federal statistical reporting practices. This included a shift in the persistent poverty methodology from a relative measure of well-being (lowest quintile of per capita income) to an absolute measure based on an OPM poverty rate cutoff. Analysis was conducted to determine an appropriate cutoff for rural (nonmetropolitan) poverty areas. Persistent poverty status became defined by a county poverty rate of 20 percent or higher in each of the Decennial Census years 1960, 1970, 1980, and 1990.
Adjusting to Changes in Data Reporting
ERS continued using the 1994 methodology, updating every decade with the release of Decennial Census poverty data, using a sliding three-decade span—baseline plus three evaluation periods. The only alteration of the methodology up until 2022 was in order to accommodate changes in poverty data collection. In 2005, the U.S. Department of Commerce, Bureau of the Census began using the American Community Survey (ACS) to capture income and poverty data on the U.S. population, eliminating similar reporting through the Decennial Census. Substate poverty estimates for the entire United States were reported as 5-year period estimates beginning with the 2005–09 period. The next update to the ERS persistent poverty typology code would need to use 5-year ACS estimates in place of the Decennial Census for the current year. The 5-year period covering 2007–11 was chosen given the mid-period data year is 2009, which is the year that best aligns with Decennial Census income years. The subsequent release of the County Typology Codes (2015 edition) used Decennial Census data for 1980, 1990, 2000 (income years 1979, 1989, and 1999), and ACS 5-year period estimates for 2007–11.
Ushering in a New Era
In the more than five decades since ERS first introduced a persistent poverty county measure, it has been adopted by various Federal agencies for a wide range of programmatic purposes. Yet it has only appeared in Federal legislation within the last 15 years, which were tailored to meet specific policy objectives and explicit program needs, originally outlined in the American Recovery and Reinvestment Act of 2009 (ARRA-2009) and more recently in the Consolidated Appropriations Act of 2021 (CAA-2021). Combined, the Acts contain at least five different definitions of persistent poverty. They generally follow ERS’s methodology, often differing only by the number of time periods used and the data source for the most recent time period. ERS continues to produce its longstanding persistent poverty county product, while also providing data and technical support to stakeholders in need of alternative definitions.
Integrating Spatial Scales and Poverty Concepts
Another feature first appearing in CAA-2021 is the combination of counties and census tracts in poverty area definitions through predominantly using the persistent poverty concept for counties and the high poverty concept for census tracts. This reflects the growing demand for poverty area measurement at the subcounty level, with census tracts—an administratively defined geography—often serving as neighborhood proxies. A limitation of using a single year of data for poverty area measurement is that poverty rates can fluctuate substantially from year-to-year, which means poverty area status can also fluctuate, particularly for areas with poverty rates near 20 percent. Persistent poverty is therefore a more reliable measure of long-term economic difficulty. Measured over multiple decades, it reduces the impact of cyclical macroeconomic changes that can produce intermittent improvements or worsening of poverty rates at the local level. However, examination of multiple years of high poverty data in the shorter run can be useful for identifying emerging areas of concentrated poverty that may diverge from historical patterns. ERS’s Poverty Area Measures data product allows for all of these types of analyses.
Meeting New Challenges
The U.S. Department of Commerce, Bureau of the Census first provided a complete national census tract geography and produced corresponding data with the release of the 1990 Decennial Census. Partly due to the lack of a long-term data series, few program agencies have used persistent poverty indicators at the census-tract level in program design. With the decades of data now available, persistent poverty census tract measures are possible. However, analyzing census tract data over time can require greater methodological complexity than with counties (for more information, see Documentation). ERS designed the Poverty Area Measures data product with the non-technical user in mind. It offers a measure of persistent poverty area status at the tract level that is comparable to ERS’s county-level definition. It also provides high poverty census tract measures for various time periods from 1970 to 2019, which allows the user to tailor high and persistent poverty area measures to the most common alternative definitions used in the Federal Government.