Study: Poverty line misses many kids who need help

November 17, 2025 - Brandon Drain

Families just above today’s federal poverty line look similar to those below it on relative measures, yet they often miss benefits tied to better learning outcomes, the study finds. 

Studies show that early childhood poverty is associated with poor academic performance, lower cognitive development, and poorer health than their more affluent peers. 

Childhood poverty is also an intergenerational problem. 

When children raised in poverty become parents, the socioeconomic challenges they face deepen, “contributing to a broader income-achievement gap across generations,” said Kyunghee Lee, associate professor at MSU’s School of Social Work. 

“Without access to adequate financial resources, these parents frequently lack the means to invest in enriching educational and extracurricular opportunities for their children, which are key predictors of academic success,” said Lee. 

In 2021, an estimated 37.9 million Americans lived in poverty, with 16.9% of those Americans being children under the age of 18.  

Yet, the way we currently define absolute poverty in the U.S. could give rise to children in need falling through the cracks.  

“The U.S. Census Bureau’s absolute poverty threshold, established in 1966, serves as the basis for assessing poverty levels, but it does not reflect contemporary living costs,” said Lee. “For example, in 2021, the absolute poverty threshold for a family of four was $27,479.” 

However, in today’s economy, essential expenses have expanded to include housing, transportation, and technology. In comparison, the relative poverty threshold for a similar family, defined as half of the median income ($70,784), was $30,392, said Lee. 

Using national longitudinal data on children ages 5–12, Lee found that children living just above the absolute poverty line but below the relative poverty threshold show similar academic outcomes to those above the relative poverty line.  

“This suggests that raising the poverty threshold to align with relative poverty measures could grant more families access to essential support services, ultimately improving academic achievement,” she said. 

The current system provides lower thresholds for households with children and fails to account for the age of children, disadvantaging older children who require more resources.  

“This failure to adapt the poverty definition to family structure and child age risks undermining developmental progress, which could have long-term negative effects on learning outcomes,” said Lee. 

To effectively reduce income achievement disparity, Lee suggests it is essential for children to escape poverty as soon as possible.  

“Addressing income disparities must be coupled with expanded early interventions (Head Start), enhanced family support, and a comprehensive ecological understanding of the broader context—such as racial disparities, family size, and maternal education,” said Lee. “By integrating these factors, we can create a more equitable foundation that enables all children, particularly those from low-income backgrounds, to achieve their full potential and close the achievement gap between the poor and their more affluent peers.”