How to read the poverty numbers

The latest poverty numbers are here: “Social Weather Report: 48% of Filipino families feel Poor, up from 45% in June; 27% feel Borderline, and 25% feel Not Poor” (www.sws.org.ph, 10/31/23). I advise reliance on the full original report, not on how it gets condensed in the mass media. The media are channels to inform the public of the issuance of a new report, for those interested in the details.

The Social Weather Station numbers (SWS) are THE current numbers. The latest official poverty figure—namely, 13.2 percent of families—refers to 2021, two years ago (“Poverty seen from above,” 8/20/22). It turns out small because the official poverty line is very stingy (“The lowering of the poverty line,” 2/12/11). The official number has already been overtaken by seven SWS quarterly poverty reports, four in 2022 and three in 2023. The final SWS quarterly report for 2023 is set for next January.

The title of the SWS report reveals a 3-point rise in the percentage of the Self-Rated Poor (SRP) between the Second Quarter (fielded on 6/28/23-7/1/23) and the Third Quarter (fielded on 9/28/23-10/1/23) this year. This unfavorable finding is statistically significant, or beyond normal sampling error.

Poverty alert in Mindanao! In the last quarter, SRP in Mindanao zoomed from 54 percent to 71 percent. This is far more than the error margin of plus/minus 6 points. The slight increases in Metro Manila and the Visayas, and the slight decrease in Balance Luzon were not significant.

Seeing poverty through the eyes of the people. The SWS interviewer addresses the poverty question to the household head, by showing a card containing the word MAHIRAP (POOR) and the words HINDI MAHIRAP (NOT POOR), separated by a line, and then asking, “Saan po ninyo ilalagay ang inyong pamilya sa kard na ito? (Where would you place your family on this card?)”.

The interviewer is trained not to speak out the words on the card, and not to mention the line. Ever since 1983, when first used, 40 years and 141 surveys ago, there has always been a substantial number pointing to the line. This has been recorded accordingly (“40 years of poverty surveying,” 1/7/23). This is evidence that, as understood by Filipinos, the distinction between the concepts Mahirap and Hindi Mahirap is a broad gulph, and not the fine line used by official statistics.

I think social scientists should recognize this gulph as a sign of the extensive inequality in our society. Philippine society is not binary. Most likely there is also much inequality within the Poor, within the Borderline, and within the Not Poor.

The people’s needs are reasonable. The SWS report includes what the Self-Rated Poor say they need for a monthly home budget in order not to feel mahirap, and what they lack in terms of those budgets; these are their poverty thresholds and poverty gaps respectively. In Metro Manila, the poor have a median threshold of P20,000 and a median gap of P10,000. The median thresholds are P13,500 in Balance Luzon, P15,000 in the Visayas, and P15,000 in Mindanao. The median gaps are P6,000 in Visayas, and P5,000 in Balance Luzon and Mindanao.

What has happened to poverty? The very long time series of data on the Poor, the Borderline, and the Not Poor allows analysis across quarters, years, regimes, or any special subperiods. The latest 48 percent Poor is the same as the 2022 average, and above the 2021 average of 46. In late 2020, the Poor were 48 percent; a full 2020 average was surely very much more. We are not yet back at the 2019 average of 45, which is my pre-COVID benchmark.

“The SRP surveys are the only source of consistently-measured poverty statistics that go back to the FEM regime. They show that poverty exploded in 1983-85, then fell raggedly under CCA, FVR, and JEE, and regained the 1983 base only midway under GMA two decades later. Poverty fell some more under BSA3; then it went flat under RRD (discounting the probable catastrophe in 2020),” (see “Watch poverty, not economic growth,” 5/21/22).

The Not Poor have also been rising. On the other hand, the body of the SWS report states that the Not Poor percentage rose from 22 to 25; that 3-point change is likewise statistically significant. By necessity, the Borderline percentage fell from 33 to 27, by 6 points; once two of the three components are known, the third component follows by arithmetic.

From 2022Q4 to 2023Q1, the Not Poor were constant at 19 percent. But they rose to 22 in Q2 and then to 25 in Q3. The latest 25 is better than the 2022 average of 21, the 2021 average of 20, and even the pre-COVID 2019 average of 24. But remember: evaluating the change in the Not Poor is distinct from evaluating the change in poverty.

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