HONOLULU — A new federal calculation that takes into account Hawaii’s high cost of living significantly increases the state’s poverty rate.
The new estimate from the U.S. Census Bureau places Hawaii seventh-highest in the nation for poverty. Under the old formula, the state ranked 32nd, according to Thursday’s Honolulu Star-Advertiser.
The new poverty measurement, unlike the official calculation that is currently used, factors in state-to-state differences in costs for such things as housing and food, subtracts work-related expenses and out-of-pocket medical costs from household incomes, and counts subsidies such as food stamps.
The revised calculation, called the “supplemental poverty measure,” will likely become the official way that poverty is evaluated in the U.S.
The new measurement estimates 49.7 million people nationwide lived in poverty last year, about 700,000 more than were included in the current poverty rate.
Using the new measurement, Hawaii’s poverty rate was revised upward by nearly 5 percentage points.
The new calculation based on averages between 2009 and 2011 puts Hawaii’s poverty rate at 17.4 percent — nearly 2 percentage points higher than the national average. It places some 229,000 Hawaii residents below the poverty line. That’s about 64,000 more than are included in the official poverty rate.