Wisconsin Poverty

Wisconsin Poverty Project

The Wisconsin Poverty Project came into being in late 2008, when a group of researchers at the Institute for Research on Poverty (IRP) sought to gain a more accurate and timely assessment of poverty throughout the state at a time when the worst recession in the postwar era was gripping the nation.

The project team is led by IRP Director Timothy Smeeding and includes IRP Visiting Scholar and Urban Institute Senior Fellow Julia Isaacs, and IRP Programmer Katherine Thornton; Public Policy Consultant Joanna Marks and IRP Postdoctoral Fellow Yiyoon Chung have worked on the project as well.

The researchers’ efforts, which are in line with broader efforts, including federal development of the Supplemental Poverty Measure, sought to inform policy with up-to-date and place-specific data that go beyond the official statistics for Wisconsin. The project, which each year produces a Wisconsin Poverty Report, joins many other endeavors by University of Wisconsin System faculty and staff to improve the lives of people throughout the state in the spirit of the Wisconsin Idea.

Simply put, the Wisconsin Poverty Project model reflects IRP’s commitment to informing public policy with research findings and, consistent with this idea, one of our primary goals in developing the Wisconsin Poverty Measure is to serve as a model for other states and localities seeking to craft their own more meaningful measures of poverty.

Wisconsin Poverty Measure

The Wisconsin Poverty Measure (WPM) was developed by a group of IRP researchers in order to provide a more accurate and timely assessment of which people and families are poor, and of the influence of public policies on poverty, than is provided by the official, national poverty measure.

In keeping with the Wisconsin Idea, the WPM serves IRP’s partners in government by revealing the effects of public policies on poverty, including the impact of temporary antipoverty policies during the recession. The measure also serves as a model for other states seeking a more meaningful measure to assess poverty and policies in ways that reflect the characteristics and policy interests of their own state. The Wisconsin Poverty Project researchers provide explicit and straightforward guidelines that other states and localities can use to develop their own measures.

Researchers and policymakers have long criticized the current official poverty measure for not accurately accounting for the contemporary needs and resources of American families, and have consequently called for improved measures. Critics assert that the official measure ignores noncash benefits and tax credits, uses an outdated (and substantially lower) poverty threshold based on a pattern of consumption in the 1960s, omits work-related expenses such as child care and health care costs, and fails to adjust for geographic differences in the cost of living.

After a National Academy of Sciences (NAS) panel offered an alternative method for measuring poverty that addresses many of these concerns, a number of scholars have developed alternative poverty measures based on the NAS method; the federal government has also recently implemented the Supplemental Poverty Measure (SPM).[1]

The WPM is one of the first comprehensive statewide implementations of the NAS-based alternative poverty measure and, as such, the study makes unique contributions to our understanding of the effects of policy on poverty. Furthermore, IRP researchers are committed to refining the methods as Census Bureau analysts and other poverty researchers produce new findings about the federal SPM and as we learn more from other poverty measurement research.

Wisconsin Poverty Reports

2013

Wisconsin Poverty Report: Is the Safety Net Still Protecting Families from Poverty in 2011?
Timothy M. Smeeding, Julia B. Isaacs, and Katherine A. Thornton, June 2013

On June 18, 2013, IRP released the fifth annual Wisconsin Poverty Report, which reveals mixed news. On the up side, the social safety net is still working in Wisconsin (but not quite as well as it worked in 2010). Tax-related provisions and near-cash benefits provided a buffer against poverty for many working families in 2011, a finding from the Wisconsin Poverty Measure, which was developed by IRP researchers.

On the down side, more Wisconsin children were poor in 2011, due to parents' declined earned incomes and reductions in the safety net. The Wisconsin child poverty rate rose from 10.8 percent in 2010 to 12.2 percent in 2011, a significant increase.

The official measure considers only pre-tax cash income as a resource, failing to capture the effects of government efforts to stimulate the economy and ease economic adversity caused by the recession through temporary increases in safety net programs and other policies.

The WPM, which was developed by IRP social scientists in conjunction with IRP data programmer analysts, uses state and local administrative data to paint a more locally meaningful picture of poverty and to provide policymakers with a yardstick for progress or regress in the effort to protect Wisconsin families from economic downturns. In determining poverty status, the WPM considers cash resources, but also tax credits and noncash benefits, and costs such as child care and health care that reduce available resources.

Largely owing to the recession and to our weak economic recovery through the end of 2011, the poverty rate based on earnings alone rose from 21.3 to 25.2 percent from 2008 to 2011. Hence the labor market had not recovered enough to begin to bring the poverty rate down in our state.

Using the WPM, researchers found that although the safety net's impact lessened in 2011 due to policy changes at the state and federal levels and the still weak economy, state poverty rates were nonetheless lower than those reported by the U.S. Census Bureau in the official poverty statistics, rising by only 0.4 percentage points from 2010 to 2011.

2012

Wisconsin Poverty Report: How the Safety Net Protected Families from Poverty in 2010, Yiyoon Chung, Julia B. Isaacs, Timothy M. Smeeding, and Katherine A. Thornton, April 2012

Wisconsin Poverty Report: Policy Context, Methodology, and Results for 2010, Yiyoon Chung, Julia B. Isaacs, Timothy M. Smeeding, and Katherine A. Thornton, May 2012

On April 25, 2012, IRP released the fourth annual Wisconsin Poverty Report: How the Safety Net Protected Families from Poverty in 2010. The report reveals good news for struggling families in Wisconsin that counters official statistics released in fall 2011. Temporary increases in safety net programs and tax credits for working families provided an effective buffer against poverty during the recession and its aftermath.

In 2010, the most recent year for which data are available, Wisconsin had a 13% official overall poverty rate. The Wisconsin Poverty Measure, which uses a more modern and complete accounting of resources and expenses, found a significantly lower poverty rate of 10.3% statewide.

The story for Wisconsin's children in 2010 is even more dramatic, with official statistics finding an 18.6% child poverty rate and the Wisconsin Poverty Project study revealing a 10.8% child poverty rate, when child and earned income tax credits and increased food assistance are counted (the official measure, devised in the 1960s, counts only pre-tax cash income and so misses the effects of some important government programs that provide a safety net during economic downturns).

While the overall and child poverty rates were lower under the new measure than under the official measure, elderly poverty rates actually were higher under the new approach, from the official rate of 7.6% to the study rate of 9.8%. Researchers attribute the higher rate to seniors' out-of-pocket medical costs that are counted under the new measure but left out of the official one.

Related Publications

Media Coverage

2011

Wisconsin Poverty Report: Were Antipoverty Policies Effective in 2009? Joanna Y. Marks, Julia B. Isaacs, Timothy M. Smeeding, and Katherine A. Thornton, May 2011

Wisconsin Poverty Report: Methodology and Results for 2009, Julia B. Isaacs, Joanna Y. Marks, Timothy M. Smeeding, Katherine A. Thornton, May 2011

Wisconsin Poverty Report: Technical Appendix, Julia B. Isaacs, Joanna Y. Marks, Timothy M. Smeeding, Katherine A. Thornton

On May 4, 2011, IRP released the third Wisconsin Poverty Report: Were Antipoverty Programs Effective in 2009? Using their new Wisconsin Poverty Measure, which takes a broader view of needs and resources than the official poverty measure, researchers examined need in 2009 and changes in economic security from 2008 to 2009. 

“Our findings are dramatic: Despite the reduction in employment and earnings in 2009, our Wisconsin Poverty Measure reveals that antipoverty programs kept child poverty steady in our state between 2008 and 2009. Expanded tax credits and food assistance benefits, which we include but the official measure does not, offset a drop in family earnings and cash income in 2009 and kept scores of Wisconsin children out of poverty,” says Tim Smeeding, lead Wisconsin Poverty Project researcher, director of IRP, and La Follette School of Public Affairs faculty member.

Related Publications

Faces of Poverty in Wisconsin, Julia Isaacs. PowerPoint presentation presented at the Rehabilitation for Wisconsin, 2011 Wisconsin Economic Summit from Poverty to Financial Security, October 26, 2011. Video of the keynote address by Julia Isaacs.

The New Demography of Poverty: The Wisconsin Poverty Measure and Effects of Federal and State Policies in Wisconsin, Julia B. Isaacs, Joanna Young Marks, Katherine A. Thornton, and Timothy M. Smeeding. Paper prepared for presentation at the 2011 Annual Meeting of the Population Association of America Washington, DC, March 31, 2011.

The “Wisconsin Idea” and Antipoverty Innovation, Timothy M. Smeeding and Joanna Y. Marks, Pathways: A Magazine on Poverty, Inequality, and Social Policy, Stanford Center for the Study of Poverty and Inequality, Summer 2011.

Media Coverage

2010

Wisconsin Poverty Report: New Measure, Broader View, Joanna Young Marks, Julia B. Isaacs, and Timothy M. Smeeding, September 2010

Wisconsin Poverty Report: Methodology and Results for 2008, Julia B. Isaacs, Joanna Young Marks, Timothy M. Smeeding, and Katherine Thornton, September 2010

Wisconsin Poverty Report: Technical Appendix, Julia B. Isaacs, Joanna Young Marks, Timothy M. Smeeding, and Katherine Thornton, September 2010

The second Wisconsin Poverty Report, which IRP released September 2, 2010, is based on findings under a new, Wisconsin-specific measure devised by IRP. The report shows that the rate of poverty in Wisconsin worsened in 2008, with more than 11 percent of the state’s population living in need, including one in seven children and one in 10 elderly residents.

“IRP created the Wisconsin Poverty Measure with the knowledge that poverty can’t be reduced unless researchers and policymakers have an accurate view of both the resources and expenses of individuals and families, as well as a measure that takes into account the way in which public policies affect low-income families, as job supports and as sources of income security and stability,” says Tim Smeeding, director of IRP and La Follette School of Public Affairs faculty member.

Related Publications

The effects of the 2009 ARRA on poverty in Wisconsin, Timothy M. Smeeding, Julia B. Isaacs, Joanna Y. Marks, and Katherine Thornton, Fast Focus 7-2010.

Media Coverage

2009

The First Wisconsin Poverty Report, Julia B. Isaacs and Timothy M. Smeeding, April 2009
Full report available in PDF format | PowerPoint Presentation in PDF format

The Institute for Research on Poverty recently released the first-ever Wisconsin Poverty Report, which shows that one in seven Wisconsin children and 10.8% of the state’s population lived in poverty in 2007 (before the economic recession took hold). Presented at the statewide “Building Bridges to Family Economic Success” summit held May 4-5, 2009, in Milwaukee, the report finds that poverty in Wisconsin is rapidly growing with the recession, as reflected in increasing food assistance program enrollment.

IRP Director Tim Smeeding notes, “We see the Wisconsin Poverty Report as a key starting point for the state’s antipoverty plan. The report can be used to target areas of greatest need within our state and subsequent studies could be used to monitor the antipoverty effectiveness of programs and policies.”

Media Coverage

Wisconsin Antipoverty Summit:
“Building Bridges to Family Economic Success”

IRP Director Tim Smeeding accepted an invitation in January 2009 from Reggie Bicha, Secretary of the Wisconsin Department of Children and Families, to serve on the planning council for the May 4 and 5, 2009, antipoverty summit, “Building Bridges to Family Economic Success.”

The summit, initiated by Governor Doyle and led by the Department of Children and Families, brought together a diverse set of people and organizations concerned about poverty in the state, including the Institute for Research on Poverty, policymakers and agency executives, tribal representatives, service providers, nonprofit organizations, foundations, and advocates. Participants examined poverty and antipoverty policies and programs in Wisconsin and set an agenda to improve the well-being of children and families across the state.

The Wisconsin Idea in Action: IRP and Wisconsin's Antipoverty Initiative

[Full Report | Executive Summary | Presentation]

In the spirit of the Wisconsin Idea, Institute for Research on Poverty researchers have been collaborating with policymakers and practitioners at the local, state, and national levels to tackle some of the toughest social problems since the Institute's founding in 1966.

Tim Smeeding, IRP Researcher Jennifer Noyes, and Jane Penner-Hoppe from the Wisconsin Department of Children and Families - all of whom are working on Wisconsin's antipoverty initiative - co-authored a paper, "Setting Priorities and Fighting Poverty in Wisconsin," which describes Wisconsin's process for designing and implementing its antipoverty initiative. Noyes presented the report at the Emory University conference on "Reducing Poverty: Assessing Recent State Policy Innovations and Strategies" held at Emory University, November 19-20, 2009.

As part of IRP's longstanding relationship with state government to identify and address issues associated with family well-being and economic security in the spirit of the Wisconsin Idea, IRP recently has focused on working in a partnership with the State to set priorities and fight poverty within Wisconsin borders. The paper "Setting Priorities and Fighting Poverty in Wisconsin" summarizes three aspects of the Wisconsin Idea in action as it relates to poverty in Wisconsin:

  1. the planning and initial implementation of a statewide effort sponsored by the governor and facilitated by the Department of Children and Families to identify long-term strategies for increasing economic security;
  2. the identification and provision of key information needed to implement these strategies, including working conferences that draw on national expertise; and
  3. the compilation and analysis of information about poverty trends in Wisconsin through the creation of the Wisconsin Poverty Report

IRP Affiliate Stimulus Commentaries:
American Recovery and Reinvestment Act ("Stimulus Bill")

The “Spotlight on Poverty and Opportunity” Web site features a special series of commentaries written by IRP affiliates that examines how the American Recovery and Reinvestment Act affects low-income Americans.

The commentaries draw from an IRP seminar held on March 5, 2009, in response to the need to know how the stimulus bill provisions change the social policy playing field. IRP Director Timothy Smeeding opened the series with the piece “First Steps toward a Strong Antipoverty Policy: New Attention to a Growing Problem.” Professor Daniel R. Meyer continued the series with an analysis of the bill’s tax and transfer programs and how they will affect those in need. Professor Andrew Reschovsky then added an examination of whether the stimulus bill will protect public education from spending cuts from the perspective of Wisconsin. Professor Pamela Herd provided an installment that examines stimulus spending on health. Professor Sara Goldrick-Rab’s installment will consider President Obama’s education policy and suggest that a greater emphasis on community colleges to improve educational attainment in the U.S.

[1] In November 2011, the Census Bureau released the first results from the new SPM in Kathleen Short, “The Research Supplemental Poverty Measure 2010: Consumer Income,” U.S. Census Bureau, Current Population Reports P60-241. Washington, DC: U.S. Government Printing Office. Available online at http://www.census.gov/prod/2011pubs/p60-241.pdf.