Poverty in 2021 Corrected for Unemployment Insurance Underreporting

8 Pages Posted: 25 Sep 2022

See all articles by Jeff Larrimore

Jeff Larrimore

Board of Governors of the Federal Reserve System

Date Written: September 13, 2022

Abstract

The 2021 CPS-ASEC underreports unemployment insurance benefits by approximately $220 billion. Using newly available summary data on unemployment insurance benefits in IRS tax records from Larrimore, Mortenson, and Splinter (2022), I estimate the effects of this underreporting on income and poverty statistics. If the CPS-ASEC had properly captured unemployment insurance benefits, the official poverty rate for income-year 2021 would have been 1.5 percentage points lower. Additionally, the supplemental poverty rate would have been 1.2 percentage points lower than that originally reported by the Census Bureau.

Keywords: Unemployment insurance, Covid-19, CPS-ASEC, poverty

JEL Classification: D31, J65, I30

Suggested Citation

Larrimore, Jeff, Poverty in 2021 Corrected for Unemployment Insurance Underreporting (September 13, 2022). Available at SSRN: https://ssrn.com/abstract=4217956 or http://dx.doi.org/10.2139/ssrn.4217956

Jeff Larrimore (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

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