1 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Introducing a Consumption Measure with Examples 

for Poverty and Inequality Analysis: A New 

Measure from the U.S. Bureau of Labor Statistics

Jake Schild

Co-authored with Thesia Garner, Brett Matsumoto, Adam Safir, and Scott Curtin

2023 Society of Government Economist Annual Conference

April 20, 2023

Session 4B: Poverty 3:15 – 4:15 p.m.
2 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Consumption as a Well-being Outcome: 

A Function of Resources and Processes

Available Resources

Income, in-kind 

transfers (private & 

public)

Asset (financial)

Asset (nonfinancial)

Debt (access and 

use)

Time

Processes

Skills (e.g., education, 

financial management, 

efficiency in converting 

inputs to outcomes)

Degree of resource 

allocation (power)

Circumstances (CU 

composition, disability)

Preferences

Outcomes (e.g.,)

1. Consumption

2. Health status

3. Material deprivation

4. Life satisfaction

5. Happiness
3 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Why Produce a Comprehensive Consumption Measure?

 Alternative measure of well-being based on outcomes

 Related academic work: Johnson, Smeeding, and Torrey (2005); Meyer and Sullivan 

(2012); Fisher, Johnson, and Smeeding (2015)

 Supports work and recommendations 

 Interagency Technical Working Group (ITWG) on Evaluating Alternative Measures of Poverty

(2020)

 CNSTAT Panel An Integrated System of U.S. Household Income, Wealth, and Consumption Data 

and Statistics to Inform Policy and Research (present)

 OECD expert groups on distributions of income, consumption, and wealth (micro and macro 

groups)

 Need to go beyond expenditures: Period of COVID-19 and consumption of home 

production

 NOTE: Have presented earlier work on progressions of our measure and used in inequality and poverty at 

various venues during 2022 (e.g., ASSA, APPAM, SGE, OECD, CNSTAT, FESAC, JSM, SEA)
4 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Data and Definition
5 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Data Sources for Current Consumption Measure

 CPS-ASEC (households/members): reported 

receipt of government provided in-kind 

benefits

 School meals (NSLP)

 Women, infants, and children (WIC) 

 LIHEAP (receipt and values)

 USDA: food assistance programs

 Center for Medicare and Medicaid Services 

(CMS) National Health Expenditure (NHE) 

 Medicare

 Medicaid

 National Health Expenditure Tables

For Most Goods and Services: 

U.S. Consumer Expenditure Survey Interview Other In-kind Federal Government Benefits

 Time period: (T)Q2 to (T+1)Q1 to represent T year

 Interviewed up to 4 times, 3-month recall 

 Consumer unit (CU)

 Out-of-pocket spending for most goods and 

services

 Rental equivalence for owned shelter

 Rent paid & characteristics to impute market rents 

when in-kind rental assistance

 Stock of cars and trucks to produce flow of services

 Medical Expenditure Panel Survey (MEPS-IC) from 

the Agency for Healthcare Research and Quality

 U.S. Department of Education Statistics

College Room and Board

In-kind Employer Health Insurance Benefits
6 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Consumption Definitions for Inequality and Poverty Analysis

Economic Well-being at 

Consumer Unit Level

Consumption

Without 

Health 

Insurance

with Health 

Insurance

with Health 

Insurance 

Capped

HI_Cap=

min(HI, 0.5*consumption with HI)

NOTE: None of these measures include “Education”
7 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving From Expenditures to Consumption

Quarterly Means for 2020

Category Total 

Expenditures

Total 

Expenditures, 

excluding gifts

Consumption 

without health 

insurance

Consumption 

with health 

insurance

Consumption 

with health 

insurance capped

Quarterly Expenditures or 

Consumption $14,555 $14,386 $12,158 $16,767 $16,675

Percent that is imputed - - 11.31% 31.87% 29.86%

Shelter $3,133 $3,114 $5,014 $5,014 $5,014

Utilities $1,049 $1,044 $1,047 $1,047 $1,047

Household Operations $362 $357 $309 $309 $309

Household Furnishings $493 $480 $408 $408 $408

Transportation $2,430 $2,404 $2,046 $2,046 $2,046

Health $1,227 $1,225 - $4,609 $4,517

Investments $2,440 $2,379 - - -

Other $3,423 $3,382 $3,333 $3,333 $3,333
8 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving from Expenditures to Consumption with Health 

Insurance: Nominal Quarterly Means

NOTE: Population weighted (FINLW21); consumption does not include education.

Measure 2019 2020 2021 (preliminary)

CE Defined Total 

Expenditures $14,717 $14,555 $16,196 

CE Defined Total 

Expenditures NOT Including 

Gifts Given Outside

$14,509 $14,386 $15,955 

Consumption without Health $12,395 $12,158 $13,562 

Consumption with Heath 

Insurance $16,792 $16,767 $18,062 

Consumption with Health 

Insurance Capped $16,716 $16,675 $18,004 
9 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Poverty and Inequality Analysis
10 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Poverty Rates for Total Population Based on Relative Thresholds

NOTE: Thresholds based on quarterly adult equivalized values; population weighted (FINLWT21*Cusize); consumption with health insurance not capped and capped at 50% of total; measures do not include education

11.2% 10.9%

15.0%

20.5%

28.2%

10.8% 10.6%

13.6%

19.2%

27.9%

11.1% 10.9%

14.4%

19.6%

28.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

Consumption with Health Ins

Capped

Consumption with Health Ins Consumption without Health

Ins

Total Expenditures Pre Tax Income

2019 2020 2021 (preliminary)
11 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Poverty Rates for Total Population Based on Relative Thresholds 

that Result in Same Consumption Poverty Rate for 2019

NOTE: Thresholds based on quarterly adult equivalized values; population weighted (FINLWT21*Cusize); consumption with health insurance not capped and capped at 50% of total; measures do not include education

11.2% 11.1% 11.2% 11.2% 11.2% 11.0% 11.2% 11.2%

9.9% 10.7% 9.8% 10.2%

8.9% 9.3%

11.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

Consumption with Health Ins

Capped

Consumption with Health Ins Consumption without Health

Ins

Total Expenditures Pre Tax Income

2019 2020 2021 (preliminary)
12 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Inequality: Lorenz Curves for

of Equivalized Consumption, Expenditures, and Income: 2020

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1

cummulative share of equivalized value of each measure

cumulative share of population based on ranking from lowest to highest value of each measure

Perfect Equality

Consumption with Health Ins Capped

Consumption without Health Insurance

Total Expenditures

Pre Tax Income

Example: 50% of the population accounts for 

30% of Consumption without Health

NOTE: Based on quarterly adult equivalized values; population weighted (FINLW21*Cusize); 

consumption with health only includes health insurance; 

Consumption measures do not include education
13 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Inequality: Gini Coefficients

of Equivalized Consumption, Expenditures, and Income

0.000 0.050 0.100 0.150 0.200 0.250 0.300 0.350 0.400 0.450 0.500

Consumption with Health Insurance Capped

Consumption with Health Insurance Not Capped

Consumption without Health Insurance

Total Expenditures

Pre Tax Income

2019 2020 2021 preliminary

NOTE: Based on quarterly adult equivalized values; population weighted (FINLW21*Cusize); 

consumption with health only includes health insurance; 

Consumption measures do not include education
14 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Next Steps

 Release

 Publish article in Monthly Labor Review (published yesterday)

 Publish table of means by commodity group (without home production) for 

2019 and 2020 on CE webpage (summer)

 To be determined: release microdata file with consumption components

 Progress will be posted on https://www.bls.gov/cex/consumption-home.htm

 Continue research - data improvements

 Add value of home production for own consumption

 Improve Imputations

 Refine the health insurance measure and research on capping

 Evaluate options to include education
15 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Contact

Jake Schild

Office of Prices and Living Conditions

Bureau of Labor Statistics

Washington, DC 20212

Schild.Jake@BLS.gov
16 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving From Expenditures to Consumption

Quarterly Means for 2020

Category Total 

Expenditures

Total 

Expenditures, 

excluding gifts

Consumption 

without health 

insurance

Consumption 

with health 

insurance

Consumption 

with health 

insurance capped

Shelter $3,133 $3,114 $5,014 $5,014 $5,014

Owned Dwelling $1,849 $1,849 $3,518 $3,518 $3,518

Rented Dwelling $1,100 $1,089 $1,188 $1,188 $1,188

Other lodging $184 $176 $308 $308 $308

Household Operations $362 $357 $309 $309 $309

Child Daycare Expenses $48 $48 - - -

Other Out-of-Pocket $313 $309 $309 $309 $309

Household Furnishings $493 $480 $408 $408 $408

Major Kitchen Appliances $72 $72 - - -

Other Out-of-Pocket $422 $408 $408 $408 $408
17 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving From Expenditures to Consumption

Quarterly Means for 2020

Category Total 

Expenditures

Total 

Expenditures, 

excluding gifts

Consumption 

without health 

insurance

Consumption 

with health 

insurance

Consumption 

with health 

insurance capped

Transportation $2,430 $2,404 $2,046 $2,046 $2,046

Vehicle Purchase

(net outlay) $1,208 $1,188 - - -

Depreciation and 

Opportunity Cost - - $829 $829 $829

Gas, Other Fuels, and Oil $386 $384 $384 $384 $384

Other vehicle expenses $782 $782 $782 $782 $782

Public and

Other Transportation $54 $51 $51 $51 $51
18 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving From Expenditures to Consumption

Quarterly Means for 2020

Category Total 

Expenditures

Total 

Expenditures, 

excluding gifts

Consumption 

without health 

insurance

Consumption 

with health 

insurance

Consumption 

with health 

insurance capped

Health $1,227 $1,225 - $4,609 $4,517

Health Insurance $918 $917 - $4,609 $4,517

Medical Services $217 $215 - - -

Prescription Drugs $65 $65 - - -

Medical Supplies $29 $28 - - -
19 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Moving From Expenditures to Consumption

Quarterly Means for 2020

Category Total 

Expenditures

Total 

Expenditures, 

excluding gifts

Consumption 

without health 

insurance

Consumption 

with health 

insurance

Consumption 

with health 

insurance capped

Other $3,423 $3,382 $3,333 $3,333 $3,333

Food $2,139 $2,136 $2,142 $2,142 $2,142

Alcohol $112 $112 $112 $112

Apparel $251 $237 $237 $237 $237

Entertainment $626 $615 $560 $560 $560

Motorized Recreational

Vehicles (net outlays) $55 $55 - - -

Other Out-of-Pocket $571 $560 $560 $560 $560

Personal Care Products $68 $67 $67 $67 $67

Reading $16 $15 $15 $15 $15

Tobacco and 

Smoking Supplies $76 $76 $76 $76 $76

Miscellaneous $135 $124 $124 $124 $124
20 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Relative Thresholds Based on Quarterly Values

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000

Consumption no health

Total expenditures no gifts

Total expenditures

Consumption with health insurance capped

Consumption with health insurance

Pre-tax income

2019 2020 2021 preliminary

NOTE: Based on quarterly adult equivalized values; population weighted (FINLW21*Cusize); 

consumption with health only includes health insurance; 

Consumption measures do not include education
21 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Thresholds Based on Anchoring Poverty Rate to Consumption 

with H Ins Capped 2019 & Relative Thresholds

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000

Consumption no health

Total expenditures

Consumption with health insurance capped

Consumption with health insurance

Pre-tax income

2019 anch 2019 2020 2021 preliminary
22 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Appendix – Table Data from previous Charts

(Not included in original presentation)
23 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 10 Table: Poverty Rates for Total 

Population Based on Relative Thresholds

Year Consumption 

with Health 

Ins Capped

Consumption 

with Health 

Ins

Consumption 

Without 

Health Ins

Total 

Expenditures

Pre Tax

Income

2019 11.2% 10.9% 15.0% 20.5% 28.2%

2020 10.8% 10.6% 13.6% 19.2% 27.9%

2021 11.1% 10.9% 14.4% 19.6% 28.0%
24 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 11 Table: Poverty Rates for Total 

Population Based on Relative Thresholds that 

Result in Same Consumption Poverty Rate for 

Year Consumption 2019

with Health 

Ins Capped

Consumption 

with Health 

Ins

Consumption 

Without 

Health Ins

Total 

Expenditures

Pre Tax

Income

2019 11.2% 11.2% 11.2% 11.2% 11.2%

2020 11.1% 11.2% 11.0% 9.9% 10.7%

2021 9.8% 10.2% 8.9% 9.3% 11.6%
25 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 12 Table: Cumulative Shares of Equivalized Values

Cumulative share of population based on 

ranking from lowest to highest value of 

each measure

Perfect 

Equality

Consumption 

With health 

ins Capped

Consumption 

without 

health 

insurance

Total 

Expenditures

Pre Tax

Income

0.1 0.1 0.04233 0.03883 0.02890 0.01058

0.2 0.2 0.10206 0.09194 0.07171 0.03935

0.3 0.3 0.17167 0.15488 0.12428 0.07994

0.4 0.4 0.24978 0.22743 0.18624 0.13269

0.5 0.5 0.33621 0.30896 0.25858 0.19901

0.6 0.6 0.43144 0.40042 0.34296 0.28101

0.7 0.7 0.53666 0.50441 0.44167 0.38140

0.8 0.8 0.65546 0.62439 0.56001 0.50740

0.9 0.9 0.79458 0.76918 0.71162 0.67548

1.0 1.0 1.0 1.0 1.0 1.0
26 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 13 Table: Gini Coefficients

of Equivalized Consumption, Expenditures, and 

Income

Year Pre Tax

Income

Total 

Expenditures

Consumption 

without 

Health 

Insurance

Consumption 

with Health 

Insurance 

Not Capped

Consumption 

with Health 

Insurance 

Capped

2019 0.464 0.372 0.295 0.247 0.250

2020 0.449 0.364 0.282 0.239 0.241

2021 0.455 0.376 0.289 0.245 0.247
27 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 20 Table: Relative Thresholds Based on 

Quarterly Values

Year Pre-tax 

income

Consumption 

with health 

insurance

Consumption 

with health 

insurance 

capped

Total 

expenditures

Total 

expenditures 

no gifts

Consumption 

no health

2019 $5,518 $5,485 $5,433 $4,183 $4,155 $3,813

2020 $5,692 $5,489 $5,446 $4,124 $4,106 $3,763

2021 $5,919 $5,962 $5,938 $4,579 $4,550 $4,238
28 — U.S. BUREAU OF LABOR STATISTICS • bls.gov

Slide 21 Table: Thresholds Based on Anchoring 

Poverty Rate to Consumption with H Ins 

Capped 2019 & Relative Thresholds

Year Pre-tax 

income

Consumption 

with health 

insurance

Consumption 

with health 

insurance 

capped

Total 

expenditures

Consumption 

no health

2019 

Anchoring

$2,883 $5,525 $5,433 $3,290 $3,505

2019 $5,518 $5,485 $5,433 $4,183 $3,813

2020 $5,692 $5,489 $5,446 $4,124 $3,763

2021 $5,919 $5,962 $5,938 $4,579 $4,238