Housing Costs and Poverty in New Hampshire

By Jason Sorens | September 10, 2019

The United States Census Bureau just released new poverty figures for the United States (PDF). While the U.S. federal government uses an "official poverty measure" for the purpose of distributing federal funds, social scientists have long known that this measure is flawed for a number of reasons, including a poor measure of inflation, ignoring in-kind benefits and refundable tax credits that the working poor receive, and a failure to adjust for differences in cost of living between different places. The Census Bureau therefore created an alternative "supplemental poverty measure" that resolves some of these problems, particularly the last two.

The release of the new data is an occasion for reflection about what housing costs mean for poverty in New Hampshire. According to the official poverty rate, only 6.4 percent of New Hampshire households are in poverty, by far the lowest rate in the country. But New Hampshire is one of about 20 states that have a much higher poverty rate when taking the cost of housing into effect (see map).

Map of states with changes in poverty rates between official and supplementary measures
Source: Census Bureau

In fact, New Hampshire has an 8.2 percent poverty rate according to the more accurate supplementary measure (SPM), only good for sixth lowest in the U.S. (Iowa is lowest, California is highest).

Why the difference? Housing costs. According to the Census Bureau,

"Higher SPM rates by state may occur for many reasons. Geographic adjustments for housing costs and/or different mixes of housing tenure may result in higher SPM thresholds." (p. 8)

One reason why California has the highest SPM poverty rate in the country likely has to do with its well-publicized housing affordability problem. Like California, New Hampshire may need to wrestle with the ethical implications of driving families into poverty due to its relatively unaffordable housing.