A new way to measure poverty shows the US falling behind Europe

I’m as frustrated as anybody else with how the economy is going in the US. But we should be skeptical about a new metric with an intuitive name that seems to confirm exactly what we all suspect but is sort of complex to interpret/measure, right?

In particular it seems weird that only we had a massive change during COVID.

Also seems a little odd that Germany was always better than the US, even in the 90’s when things were pretty good here.

Putting it together, we need to have COVID all the time here, so we can match the economic development of Germany immediately post-reunification.

The new measure:

> As of 2025, the time needed to earn $1 is 63 minutes in the US.

Confused, I clicked one of the links and tried to understand. Found this:

> The time to get $1 refers to a day of life for anyone at any age and in any circumstance, not just the hours worked by someone with a job.

Clicking another link took me to the abstract at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4785458 but that didn't answer any questions either.

I can't find anything really of substance in this, other than someone trying to redefine a lot of terms in confusing ways

$1 every 63 minutes would be $8343/year. I cannot think of any way to reconcile that with the US average household income or any other related figure.

Average != median. This measure seems to be so high because there are so many low paid workers in the US due to low minimum wage.

Median workers in the US have some of the highest hourly wages at PPP in the rich world and they have been increasing, but they are pretty similar to those in Germany. The big difference in annual pay at PPP is down to hours worked.

For 2022 average annual hours worked per worker in the US is 1790 while in Germany it is 1340 [1]. Meanwhile average hourly wages at PPP in US are $34.9 vs $34.6 in Germany [2]

[1] https://ourworldindata.org/grapher/annual-working-hours-per-...

[2] https://ourworldindata.org/grapher/average-hourly-earnings

> The $1 is measured in international dollars. This means it buys the same amount of goods and services in any country as a US dollar does in the United States. It is often used alongside purchasing power parity (PPP) data. The “time” refers to a day of life for anyone, at any age and in any circumstance — not just the hours worked by someone with a job.

So IIUC this "average poverty" (measured in time per international dollar) includes people living off social welfare? Otherwise, if it only included the working population, wouldn't we have

  average poverty ≝ (average yearly income* of the working population / 1yr)⁻¹

*) Adjusted for purchasing power, i.e. measured in international dollars.

Is the measure they are using inflation adjusted over time? If not this shows an enormous loss in purchasing capacity over time for the average person, which is certainly how its felt over the past decades as inflation has outrun wages for most people.

This metric makes a lot of intuitive sense and reflects the consumer sentiment I hear from neighbors. "Working more for less" isn't a new complaint, but something that measures that is interesting.

I would be very interested to find out how those stats are related to things like, GINI or old pre-GDP economic measures of raw production.

I would guess this is because places like Germany having incredibly low annual working hours.[1] The bottom of the list is populated by all European countries.

[1]https://en.wikipedia.org/wiki/List_of_countries_by_average_a...

it feels counterintuitive to me that US "average poverty" dropped more than 50 percent in covid, while european stayed absolutely untouched.

Sterck's article from The Conversation referenced in this article: https://theconversation.com/measuring-poverty-on-a-spectrum-...

OK, the idea is interesting, but the numbers seem completely bogus. In what world does it take the average American 63 minutes to earn $1, even one "international" dollar?

I get the "international" part - purchasing power. The number still seems way off, though.

In a time when minimum wage is $7/hr, how is the average American earning $1/hr?

Can anyone make that number make any sense?

This seems like a quite nice way to measure poverty.

I believe this is the paper https://ora.ox.ac.uk/objects/uuid%3A501e8eb8-3ce7-4ac0-9d09-...

This metric rates very high on my private index Compensation, Obscuring, Paltry, Earnings (COPE)

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