P70-63 1

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

Current Population Reports

Household Economic Studies

Dynamics of Economic Well-Being,

Poverty 1993-94:

Trap Door? Revolving Door? Or Both?

C E N S U S B U R E A U P70-63

Issued July 1998

U.S. Department of Commerce Economics and Statistics Administration

By Mary Naifeh

Introduction

The prevalence and persistence of

poverty are central issues in both

“Welfare Reform” and the “War on

Poverty.” Providing both snapshots

and videos of poverty from various

perspectives, data from the 1993

panel of the Survey of Income and

Program Participation (SIPP) picture poverty primarily as a transitory condition for many and a

chronic condition for some. Poverty

rates are like snapshots: they describe the percentage of people

who are poor for a specified period

of time. Poverty spells and transitions, in contrast, are like videos:

they show how long people stay

poor, as well as movements into

and out of poverty. These diverse

statistics provide a richer picture of

poverty than does a single annual

rate. Reflecting diverse viewpoints,

“War on Poverty” proponents may

emphasize how many individuals

experience any episode of poverty

and the duration of the episodes,

but “Welfare Reform” advocates

may focus primarily on people who

are chronically poor. Both groups

are likely to examine transitions

into and out of poverty.

This report uses data from the

1993 SIPP panel to examine

poverty from October 1992

through December 1995.1

 SIPP

allows us to examine both the

static and dynamic aspects of poverty, thereby providing a richer picture than the one drawn by the

Current Population Survey (CPS),

the survey currently used for official poverty rates. The CPS provides only a single static snapshot

of poverty for the population.

SIPP’s longitudinal data provide

not only several static pictures but

also several dynamic measures of

movement into and out of poverty

and poverty spells or duration. In

addition, SIPP can also distinguish

between short-term and long-term

poverty. Unlike the CPS’ annual

data, the SIPP uses monthly data

to measure poverty; hence, the

SIPP allows one to measure poverty on a monthly basis as well as

for longer periods of time.

The picture of poverty drawn by

statistics depends partly on the

type of statistics used. In this report we describe poverty using

seven different measures:

1. Average monthly poverty rate:

Measures poverty for each person in each month of a calendar

year, computes the total, and

averages it for the year.

2. Episodic poverty rate: Percent

poor for two consecutive

months or more in a given year

or panel.

3. Chronically poor: Percent poor

for all of 1993 and 1994–a

2-year period.2

4. Annual rate: Percent poor in a

given year based on total income for the year and poverty

thresholds that reflect changes

in household composition during

the year.3

5. Poverty spells: Number of

months in poverty for those who

are not poor the first interview

month, but become poor at

some point in the panel.

6. Entry rate: Percent of people

who were not poor during 1993

but were poor in 1994 using the

annual rate given above.

7. Exit rate: Percent of people

who were poor during 1993 but

were not poor in 1994 using the

annual rate given above.

The first four statistics give snapshots for different periods of time;

Exits

Entries

Poor 24 months

Average monthly

poverty rate

Annual poverty rate

Poor 2 or more months

Figure 1a.

Selected Poverty Rates: 

1993 and 1994

Figure 1b.

Number Entering and Exiting Poverty: 

1993-94

Numbers in millions

Percent

1994

1993

1993-94

6.9

7.6

21.4

22.3

12.6

12.9

15.4

15.7

5.3
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U.S. Census Bureau, the Official StatisticsTM July 8, 1998

the last three provide videos. The

first text box lists the name and

gives a brief description of each of

these measures. For comparison

purposes, it also lists the annual

rate used with CPS data for the official measure of poverty. The annual rate, listed above as number

4, is an analogous–but not identical–measure.

We begin with highlights from this

report. Next, to illustrate the complexity of poverty, we use each of

these measures to describe poverty in the U.S. population as a

whole. We then describe subpopulation differences within static and

dynamic measures. Finally, we

summarize these results and point

out divergent patterns in population subgroups.

Using several types of poverty statistics challenges some common

perceptions. Within a given demographic characteristic, some

groups have high poverty statistics

on every measure; other demographic groups are more likely to

be relatively poorer on some measures, but not on others. This lack

of uniformity across poverty statistics paints a more complex picture

of poverty.

Highlights 4

• About 40 (+1.5) million people

were poor in 1994, reflecting an

average monthly poverty rate of

15.4 (+ 0.5) percent. Although

the average monthly poverty

rate for 19935

 was statistically

similar at 15.7 (+ 0.5) percent,

the overlap of specific individuals is limited. Only one-third of

those who were poor in an average month of 1994 were poor

for all of 1993 and 1994 (5.3

+ 0.4 percent).

• The proportion of people who

were poor at some point in time

during 1994 (21.4 + 0.6 percent) was four times greater

than the proportion who were

poor every month of both 1993

and 1994 (5.3 + 0.4 percent).

• Hispanics6

 had the highest entry rate into poverty (7.4 + 1.7

percent) and the highest episodic poverty rate for the 36

months of the 1993 SIPP

panel (53.9 + 2.6 percent) of

any racial or ethnic group;

Blacks had the lowest exit rate

(17.7 + 2.7 percent), and the

longest median poverty spell

(6.8 months).

• The picture of poverty for the

three age groups we examine

here is complex. Children had

the highest average monthly

poverty rate (24.5 + 1.1 percent), episodic poverty rate

(32.4 + 1.4 percent), chronic

poverty rate (9.4 + 0.9 percent), and entry rate (4.4 + 0.7

percent) of any age group.

Retirement-age adults had the

lowest average monthly poverty rate (10.2 + 1.1 percent),

episodic poverty rate (13.5

+ 1.4 percent), and entry rate

(2.0 + 0.7 percent) of any age

group. But children’s median

poverty spell (5.3 months) and

exit rate (20.1 + 2.7 percent)

were statistically similar to

those of adults 65 and over

(6.7 months and 14.9 + 5.2

percent).

• No matter which poverty measure is used, people in families

with a female householder are

more likely to be poor than

those in married-couple families

or unrelated individuals.

• People in central cities typically were at higher risk of

How Do We Measure Poverty?

Average monthly poverty Average percent of people poor

in a given calendar year per month in 1993, 1994. Measures

poverty for each person in each month and

averages it over a calendar year.

Episodic poverty Percent of people who were poor in 2 or

more consecutive months of time period.

Chronic or long-term poor Poor every month of 1993 and 1994

(measured monthly).

Annual rate Percent of people who are poor in a

calendar year. Sum of income over the

year divided by the sum of poverty

thresholds which can change from

month to month if family composition

changes.

Spells Number of months in poverty of people

who were not poor the first interview month.

Computed only for those who were poor at

some time during the panel. Minimum spell

length is 2 months. Individuals can have

more than one spell.

Entries Not poor in 1993; poor in 1994. Uses

annual rates.

Exits Poor in 1993; not poor in 1994. Uses

annual rates.

Annual poverty rate in Percent in poverty. Annual income divided

CPS (official rate– by poverty threshold which is based on

listed here for purpose family composition in March. (N.B. CPS

of comparison) only has annual income–not monthly

income–and threshold is based on

composition in March.)
P70-63 3

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

poverty than their suburban or

nonmetropolitan counterparts.

However, the central city exit

rate (19.9 + 2.8 percent) was

similar to the rate for

nonmetropolitan residents

(26.3 + 3.9 percent).

An Overview of the

Poverty Picture

Thirty percent of the U.S.

population were poor for at least

2 months, but only 5 percent

were poor continuously for a

period of 24 months.

The picture of poverty is more

complex than the one reported

with a single poverty rate. The

measures shown in Figure 1 describe poverty for the U.S. population in 1993 and 1994. Measuring poverty month by month and

then averaging over the 12

months of each calendar year,

approximately 40 million people

were poor in 1993 and 1994. The

average monthly poverty rate

was 15.7 percent in 1993 and a

statistically similar 15.4 percent in

1994. Annual poverty rates were

also statistically similar: 12.9

percent in 1993 and 12.6 percent

in 1994.

Although the similarity in these estimates of the number of poor and

poverty rates may suggest to

some that poverty is a chronic condition, the reality is quite different:

The chronic poverty rate was only

one-third of the average monthly

rate of 1994. Specifically, only 5.3

percent were poor for all 24

months of 1993 and 1994, compared with the 15.4 percent average monthly poverty rate of 1994.

In contrast, far more people experienced episodes of poverty. Thirty

(30.3) percent of the population

were poor for at least 2 consecutive months over the 36 months

that they were in the 1993 SIPP

panel. Reflecting shorter time periods, the episodic poverty rates

were a statistically similar 22.3 percent for 1993 and 21.4 percent for

1994. Thus, the proportion of

people who were poor at some

point in time during one of these

calendar years was four times

greater than the proportion who

were poor every month of both calendar years (22.3 and 21.4 percent versus 5.3 percent).

These various static rates tell us

what fraction of the population was

poor, but they do not tell us how

long people were poor. For this we

need a dynamic measure. Poverty

spells measure the duration of

poverty for people who are poor for

some period during the panel.7

Most people who experienced poverty were poor for a few months:

for spells starting after the beginning of the panel, the median spell

lasted 4.5 months.

Additional dynamic detail is provided by measuring exits from and

entrances into poverty. About 7.6

million individuals who were poor in

1993 became non-poor in 1994,

and a statistically similar 6.9 million

individuals who were not poor in

1993 became poor in 1994. These

similar numbers represent an exit

rate of 23.8 percent and an entry

rate of 3.2 percent. The wide disparity in the entry and exit rates,

coupled with total numbers that are

not dramatically different, reflects

Average Monthly Poverty Rate:

What is it? Why is it higher than the annual rate?

Average monthly poverty rate Annual poverty rate

How is it computed? For each person, family income in a For each person, the sum of family

given month is divided by the poverty income over the year is divided by the

threshold for the family composition sum of poverty thresholds which can

in that month. The total number poor change from month to month if family

for each of the 12 months of the year composition changes.

is then divided by 12 to get the

average monthly rate.

How do they differ? Computes poverty for each month. A A person must be poor for the year based

person can be poor in 1 month and on the sum of family income and thresholds

not poor the other 11 months of the in order to contribute one person to the

year. This person will contribute 1/12 annual poverty rate.

to the average monthly poverty rate.

Why is the average Since people can contribute to the This is an all or none measure. Each

monthly poverty rate poverty rate on a monthly basis, the person can contribute a count of 1 or 0

higher than the annual fractional contributions result in a to the number who are poor, the numerator

poverty rate for a given year? higher rate. Twelve people who are of the rate.

poor for only 1 month of the year,

contribute one person to the average

monthly poverty rate but contribute

nothing to the annual poverty rate.
4 P70-63

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

the fact that far more people are

not poor than are poor.8 These

various statistics portray poverty

as a trap door for a few and a revolving door for many.

Expanding on these measures of

poverty, the rest of this report describes the poverty experience of

several demographic groups. The

poverty picture for these subpopulations mirrors that of the whole

population: relatively low rates of

chronic poverty coupled with

higher average monthly poverty

rates and even higher rates of episodes of poverty, modest poverty

spells, and exit rates that exceed

entry rates. Despite the similarity in

pattern, there are some notable

differences among these groups.

We explore differences among

subpopulations categorized by

family type, age, race, and residential location.

Snapshots: Poverty Rates

Figures 2, 3, and 4 show the percent of people who were poor 2 or

more months during 1994, the percent of people who were poor in an

average month of 1994, and the

percent of people who were poor

every month of 1993 and 1994, by

family status, age, race and Hispanic origin, and residential location. The figures show a strong relationship between these

characteristics and poverty status.

However, the relationships are not

always consistent.

People in families with a

female householder have much

higher poverty rates than do

married-couple families or

unrelated individuals

Single-parent families usually

have female householders and

people in this type of family are

far more likely to be poor than either unrelated individuals or

people in married-coupled families. In 1994, people in families

with a female householder had a

higher average monthly poverty Nonmetropolitan

Suburbs

Central city

Unrelated individual

Female householder

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 4.

Chronic Poverty Rates: 1993-1994

(Poor all 24 months)

Percent

5.3

3.8

14.1

13.5

9.4

3.4

5.4

2.1

17.8

8.2

8.9

2.9

5.8

Nonmetropolitan

Suburbs

Central city

Unrelated individual

Female householder

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 3.

Average Monthly Poverty Rates: 1994

Percent

15.4

12.7

31.2

31.4

24.5

12.3

10.2

8.4

39.8

21.1

21.5

10.0

17.5

Nonmetropolitan

Suburbs

Central city

Unrelated individual

Female householder

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 2.

Episodic Poverty Rates: 1994

(Poor at least 2 months)

Percent

21.4

18.3

40.2

41.8

32.4

18.1

13.5

14.1

48.4

27.0

28.6

14.9

25.4
P70-63 5

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

rate (39.8 percent) than did

people in either married-couple

families (8.4 percent) or unrelated individuals ( 21.1 percent).

However, more dramatic differences are evident for chronic

poverty. Female-householder

families have a chronic poverty

rate (17.8 percent) that is twice

as great as that of unrelated individuals (8.2 percent)9

 and eight

times as great as that of marriedcouple families (2.1 percent).

Among the three age groups,

children have the highest

poverty rates and older adults

have the lowest average

monthly and episodic

poverty rates.

Children and older adults are usually viewed as having a high risk

of poverty, but the rates that are

shown here only partially support

this belief. Children have the highest poverty rates among the three

age groups, but older adults often

have the lowest rates. In 1994,

32.4 percent of children were

poor for at least 2 months, compared with 18.1 percent of adults

18 to 64 and 13.5 percent of

adults 65 or older. Chronic poverty was also more prevalent

among children than among

adults: 9.4 percent of children

were poor for all 24 months of

1993 and 1994. However, in a

departure from the episodic poverty pattern–in which older adults

have the lowest incidence of poverty among the age groups–

adults 65 or older were more

likely to be chronically poor than

were younger adults (5.4 and 3.4

percent respectively). The greater

stability of income among the elderly–compared with younger

adults–probably accounts for this

reversal of relationships of longand short-term poverty between

the two age groups.

Few differences in poverty

rates exist between Blacks

and Hispanics.

For all three measures, Whites

had the lowest poverty rates

among the three race and ethnic

groups, but Blacks and Hispanics

often had statistically similar

rates. The average monthly poverty rate in 1994 was 31.2 percent for Blacks and 31.4 percent

for Hispanics. The chronic poverty rate was 14.1 percent for

Blacks and 13.5 percent for Hispanics. The 1994 episodic poverty rate was 40.2 percent for

Blacks and 41.8 percent for Hispanics. Only the episodic poverty

rates for 1993 and for the entire

panel were statistically different

and even then not by much: the

panel episodic poverty rate was

50.5 percent for Blacks and 53.9

percent for Hispanics.

More than 24 months

21 to 24 months

17 to 20 months

13 to 16 months

9 to 12 months

5 to 8 months

2 to 4 months

Figure 5.

Duration of Poverty Spells: 1993-1994

(Excludes spells underway during the first interview month.)

Percent

47.3

19.4

8.7

5.3

3.7

2.8

12.9

Central cities have the highest

poverty rates of any locale;

their suburbs have the

lowest rates.

Since poverty generally is associated primarily with inner cities and

secondarily with nonmetropolitan

areas, it is not surprising that poverty rates differ by residential location. In 1994, the average monthly

poverty rate was 21.5 percent in

central cities, 17.5 percent outside

of metropolitan areas, and 10.0

percent for those who lived outside

the central city but within metropolitan areas–areas that we will

call “suburbs” in this report. Similarly, chronic poverty rates were

8.9 percent (central city), 5.8 percent (nonmetropolitan), and 2.9

percent (suburbs), respectively.

Videos: Poverty Spells

and Transitions

Providing dynamic measures of

poverty, Figures 5, 6, 7, and 8

show measures of poverty spells

and transitions. Figure 5 shows the

distribution of poverty spells. That

is, for those who were not poor

during the first interview month but

became poor at some point during

the survey, it shows how long they

remained poor.10 It is important to

note that this is an analysis of

spells, while other statistics in this

report are analyses of individuals.

People can have more than one

spell. Figure 6 shows median

spells of poverty for various demographic groups. Figures 7 and 8

give the rates of exit from and entry into poverty, respectively.

One-half of all spells lasted for

4.5 months or less.

For poverty spells that began after

the first interview, just over onehalf (52.8 percent) lasted more

than 4 months, one-third (33.4 percent) lasted more than 8 months,

and one-quarter lasted more than

a year. Overall, the median poverty

spell was 4.5 months. For the various demographic subgroups,

those with the highest poverty
6 P70-63

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

rates tended to have the lowest

exit rates and the highest entry

rates into poverty. They also

tended to have the longest poverty

spells. However, this was not always the case. Divergence from

the common pattern adds depth to

our picture of poverty.

Individuals living with a female

householder have the highest

entry rate into poverty of any

family type.

Tabulations of poverty spells by

family type exhibit the now-familiar

pattern. Among the three family

types, people living with female

householders had the longest median poverty spell (7.2 months),

and those in married-couple

households had the shortest median spell (3.9 months). Unrelated

individuals had median poverty

spells of 4.5 months, which is statistically similar to that of marriedcouple families. People living in

other family types11 had a lower

exit rate from poverty (18.3 percent) and higher entry rate into

poverty (6.5 percent) than did

people living in married-couple

households (27.8 and 1.9 percent,

respectively). They also had a

higher entry rate than unrelated individuals (4.6 percent). However,

the exit rates of other family types

(18.3 percent) and unrelated individuals (19.6 percent) were statistically similar.

Children had the highest entry

rate into poverty and, along

with older adults, had a low

exit rate.

Age groups deviated from the

typical pattern. Mirroring the average monthly poverty rate, children had the highest entry rates

and older adults had the lowest

of any age group. Among those

who were not poor in 1993, 4.4

percent of children, 3.0 percent

of adults 18 to 64, and 2.0 percent of adults 65 or older became poor in 1994. In contrast,

however, children and retirement-age adults had statistically

Nonmetropolitan

Suburbs

Central city

Unrelated individual

Female householder

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 6.

Median Poverty Spells: 1993-1994

Months

4.5

4.2

6.8

5.0

5.3

4.0

6.7

3.9

7.2

4.5

5.4

4.1

4.2

Nonmetropolitan

Suburbs

Central city

Unrelated individual

Other family type

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 7.

Entry Rates: 1993-1994

Percent

3.2

2.9

5.3

7.4

4.4

3.0

2.0

1.9

6.5

4.6

4.3

2.5

3.4

Nonmetropolitan

Suburbs

Central city

Unrelated individual

Other family type

Married-couple families

65 years and over

18 to 64 years

0 to 17 years

Hispanic

Black

White

All

Figure 8.

Exit Rates: 1993-1994

Percent

23.8

27.4

17.7

23.6

20.1

28.8

14.9

27.8

18.3

19.6

19.9

27.5

26.3
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U.S. Census Bureau, the Official StatisticsTM July 8, 1998

similar exit rates and median

spells. The 20.1 percent exit rate

of people less than 18 years old is

not statistically different from the

14.9 percent exit rate of older

adults. Younger adults, with an exit

rate of 28.8 percent, were more

likely to escape poverty than either

children or older adults. Although

the median poverty spell of older

adults (6.7 months) appears to be

the longest of any age group, it is

not statistically different from either

of the younger age groups. However, the median poverty spell for

children (5.3 months) was longer

than that of adults aged 18 to 64

(4.0 months).

Blacks had a lower entry rate

into poverty than Hispanics,

but they also had a lower

exit rate.

Among the race/ethnicity subpopulations, the dynamic measures

paint a distinctly different picture

for Blacks and Hispanics. Blacks

had a lower entry rate (5.3 percent

for Blacks versus 7.4 percent for

Hispanics), but they also had a

longer median poverty spell (6.8

months) and a lower exit rate (17.7

percent) than did Hispanics (5.0

months and 23.6 percent, respectively). Of the three groups, Whites

had the lowest entry rate (2.9 percent), but their ostensibly shorter

median spell (4.2 months) and

higher exit rate (27.4 percent) were

not statistically different from those

of Hispanics.

Like central city residents,

nonmetropolitan residents

had a high entry rate into

poverty, but like suburban

residents, nonmetropolitan

residents also had a high exit

rate from poverty.

As might be expected, people living in central cities had the longest

median spell (5.4 months versus

4.1 and 4.2 months for suburban

and nonmetropolitan residents, respectively) and they had the lowest exit rate (19.9 percent versus

27.5 percent and 26.3 percent).

Residents of central cities also had

a higher entry rate (4.3 percent)

than suburban residents (2.5 percent). What is surprising is the lack

of differentiation of nonmetropolitan residents. Their median

spell (4.2 months) and exit rate

(26.3 percent) were statistically

similar to those of residents in suburban areas; their entry rate (3.4

percent) was statistically similar to

the entry rate of residents of central cities.

Summary

Poverty measures show a

consistent pattern for family

type and residential location,

but not for age and race.

The picture of poverty is generally

consistent across all measures for

type of family and residential location but different for age and race/

ethnicity groups. For type of family,

poverty statistics generally show

that people living with female

householders were most likely to

be poor and people living with

married couples were least likely

to be poor. Similarly, people living

in the central city of a metropolitan

area were most likely to be poor,

and their metropolitan neighbors,

who lived outside of the central

city, were least likely to be poor regardless of the measure used.12

Poverty statistics for race/ethnicity

and age groups were not uniform

within each of their demographic

categories but some similarity is

evident between them. The divergent patterns increase our understanding of poverty.

Hispanics had a higher episodic

poverty rate for the panel and a

higher entry rate into poverty in

1994 than did Blacks. Blacks, on

the other hand, had a longer median spell, and lower exit rate from

poverty than did Hispanics. Whites

had statistics consistent with lower

poverty. This combination of statistics suggests that Hispanics faced

a high risk of poverty but poverty

was more likely to be transitory,

while Blacks faced a slightly lower

risk of poverty but poverty was

more likely to be persistent.

For the three age groups, the differences were more complex than

they were for the race/ethnicity

groups. Older adults had the lowest average monthly poverty rate,

episodic poverty rate, and entry

rate of any age group, but they

also had a low exit rate from poverty. The chronic poverty rate of

those 65 or older was intermediate: higher than that of younger

adults, but lower than that of children. Poverty statistics for children

typically indicated the greatest likelihood of poverty except for median

spell and exit rates, which, although they indicate greater poverty for children, were not statistically different from those of older

adults.13 Children had the greatest

risk of becoming poor, being poor,

and remaining poor for 2 calendar

years. Elderly people, in contrast,

had the lowest risk of becoming

poor and being poor, but, once

they became poor, were as likely

as children to remain poor. These

statistics suggest that elderly

people are likely to be divided into

two disproportionate groups: a

small one which experiences persistent poverty, and a larger one

which eludes poverty.

These statistics show that poverty

may seem to be a relatively simple

picture, but, in fact, it is complex.

Furthermore, the complex picture

of poverty requires dynamic measures to bring it into focus.
8 P70-63

U.S. Census Bureau, the Official StatisticsTM July 8, 1998

1

The longitudinal estimates presented

here are based on people who either were

interviewed in all waves of the reference period, or for whom imputed information exists.

Efforts were made during the life of the panel

to ensure that the sample remained representative of the noninstitutional population of

the United States. People who moved were

followed to their new address. A “missing

wave imputation” procedure was used for

people who missed an interview but had

completed interviews before and after the

missing wave. If the people included in the

estimates have different experiences of poverty than do the people who did not respond

initially, left the sample, or missed two or

more consecutive waves, these longitudinal

estimates may be biased. 2

These data do not capture long-term

poverty that endures for more than 2 years.

This may bias the results and show a “rosier”

picture than is actually the case. 3

This measure computes a sum of family

income over the entire year and a sum of

poverty thresholds based on family composition in each month of the year. It differs from

the CPS measure which obtains annual income and uses family composition in March

of the following year (i.e., the interview

month) to determine the threshold. Annual

poverty rates are reported only for the total

population.

4

The figures in parentheses signify the

90-percent confidence intervals of the estimates. 5

Statistics for 1993 in this report tend to

be different from statistics for 1993 previously published for SIPP from the 1992

panel. This situation occurs for two reasons:

1) Poor people are more likely than non-poor

people to attrit over the life of the panel and

1993 is the second calendar year of the 1992

panel but only the first year of the 1993

panel. 2) The 1992 panel sample is different

than the 1993 panel sample and sampling

variations will result in a different point estimate, even of the same concept. 6

People of Hispanic origin may be of any

race. The information on the Hispanic population shown in this report was collected in

the 50 states and the District of Columbia,

and therefore, does not include residents of

Puerto Rico. 7

People can have more than one poverty

spell. Spells are separated by 2 or more

months of not being poor. 8

Since the number of people who are not

poor is much larger than the number who are

poor, the base or denominator for entries into

poverty is larger than the one for exits. As a

result, even if the number of people who entered poverty were the same as the number

who exited, entry rates would be much

smaller than exit rates.

 Similarly, the number of people represented by a lower rate may be much larger

than the number of people represented by a

higher rate if the bases are different. For example, the 1994 average monthly poverty

rate of 12.7 percent for Whites represents

27.5 million people, but the 31.2 percent rate

for Blacks represents 10.3 million, a much

smaller number. 9

The average monthly poverty rate of

people in married-couple families is statistically similar to the chronic rate of unrelated

individuals. 10The spells of people who were poor at

the first interview month are excluded because their starting point is unknown. Approximately 7 percent of all spells began in

or before the first interview month. 11Exits and entries into poverty are reported for people whose family status was

unchanged throughout the panel. Ninety-five

percent had the same status throughout the

panel. For the family type category, exits and

entries into poverty are reported for “other

family type” rather than “families with a female householder.” Most “other type” families are female-householder families (viz. 85

percent in 1994). 12Recall that nonmetropolitan and central

city residents had similar entry rates, and

nonmetropolitan and suburban residents had

statistically similar exit rates and median

spells. Similarly, median spells for marriedcouple families and unrelated individuals

were not statistically different. 13The median spells and exit rates of children and the elderly appear to indicate less

poverty for children than for older adults.

However, they were not statistically different.