New Metric Gauges How Much SNAP Benefits Support Lowest-Income Households

Researchers at USDA, Economic Research Service, the World Bank, and Georgetown University examined SNAP’s effectiveness at improving the well-being of the poorest U.S. households by raising their income levels. To accomplish this, the researchers developed a measure—the income floor— to represent the income level of the poorest household in a society. It may seem straightforward to use the lowest value of household income reported in a nationally representative survey as the measure of the income floor. However, there are pitfalls to using the minimum reported income level in household survey data to represent the income floor in a population. For example, households may not be able to accurately report their earnings, especially if they have jobs that are sporadic or informal. Therefore, rather than being based on the income level of a single household, the income floor is calculated as a weighted average of the incomes of all households living below the poverty line. To best estimate the lowest household income level, the weighted average gives increasingly more weight to households as their incomes approach the lowest reported income in the data.