US Poverty Rate by State

Why Are Some States So Poor and Others So Rich?

Young man studying in apartment with roomates
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U.S. poverty is determined by the federal poverty threshold. The U.S. Census Bureau calculates it each year to report how many Americans live in poverty.

U.S. Poverty

, the 2017 official poverty rate was 12.3%. In other words, 39.7 million Americans lived in poverty. More than half or 56% were women. Sadly, 32% of those living in poverty were children. That's 12.8 million children under age 18.

Another 12%, or 4.7 million, were aged 65 years or older. There were 9% who had a disability.

Two-thirds or 67% were white. Forty-two percent lived in the South, 23% lived in the West, and 19% in the Midwest.

Almost all or 83% were born in the United States. Only 11% were not citizens.

Even those with jobs were not protected from poverty. Six percent of those living in poverty were working full-time with a year-round job. Fourteen percent worked part-time for the whole year. Another 35% only worked during part of the year. 

Despite the success of the War on Poverty, not many of these low-income people receive welfare. TANF is the Temporary Assistance for Needy Families program. In December 2017, it served . That's less than 10% of those living in poverty. Of those, . That's fewer than 20% of the children who needed it. 

U.S. Poverty by State

The as a two-year average. The list below shows the percent of people living in poverty as of 2016 and 2017.

  • Alabama - 15.6
  • Alaska - 13.5
  • Arizona – 14.7
  • Arkansas – 15.4
  • California – 13.2
  • Colorado – 8.1
  • Connecticut – 10.4
  • District of Columbia – 14.9
  • Florida – 13.3
  • Georgia – 14.3
  • Hawaii – 9.8
  • Idaho – 11.4
  • Illinois – 11.5
  • Indiana – 11.6
  • Iowa – 9.4
  • Kansas – 12.9
  • Kentucky – 14.8
  • Louisiana – 20.8
  • Maine – 12.3
  • Maryland – 7.5
  • Massachusetts – 10.1
  • Michigan – 11.9
  • Minnesota – 9.0
  • Mississippi – 19.7
  • Missouri – 12.0
  • Montana – 10.7
  • Nebraska – 10.0
  • Nevada – 11.9
  • New Hampshire – 6.5
  • New Jersey – 9.0
  • New Mexico – 18.2
  • New York – 12.6
  • North Dakota – 11.2
  • Ohio – 13.2
  • Oklahoma – 13.6
  • Oregon – 11.0
  • Pennsylvania – 11.2
  • Rhode Island – 11.8
  • South Carolina – 14.8
  • South Dakota – 12.4
  • Tennessee – 13.2
  • Texas – 13.6
  • Utah – 8.6
  • Vermont – 9.9
  • Virginia – 10.8
  • Washington – 10.4
  • West Virginia – 17.7
  • Wisconsin – 10.1
  • Wyoming – 11.6

Why Some States Have So Much Poverty

Six of the 10 states with the most poverty are in the South. Here are 2017 poverty rates for the 10 poorest states:

  • Louisiana – 20.8
  • Mississippi – 19.7
  • New Mexico – 18.2
  • West Virginia – 17.7
  • Alabama – 15.6
  • Arkansas – 15.4
  • District of Columbia – 14.9
  • Kentucky – 14.8
  • South Carolina – 14.8
  • Arizona – 14.7

It's no surprise that these states also have the lowest income in America. One reason is that the region has long been dependent on agriculture. It had textile and clothing manufacturers that were located near cotton fields. But over time, foreign countries could make the products more cheaply. Their manufacturing costs were low enough to compensate for added transportation expenses. As a result, China and India took these higher-paying jobs. 

The advantage to living in these states is that they are the to live in. The five with the lowest cost of living are Arkansas, Mississippi, Alabama, Kentucky, and West Virginia.

You are confined to rural areas, older areas in some cities, college towns, and states with a low cost of living. These tend to be in areas with a low standard of living.

 reveals the nation's income inequality

Why Some States Have So Little Poverty

States with a high cost of living will have low levels of poverty. The poverty threshold is a national average. People with incomes below that level can't afford to live in these states.

States with low levels of poverty are in the northeast. Six of the 10 richest states are near a major U.S. East Coast city. . As a result, highly-educated people live in those cities. There is a .

Here is a list of the 10 states with the lowest level of poverty:

  • New Hampshire – 6.5
  • Maryland – 7.5
  • Colorado – 8.1
  • Utah – 8.6
  • Minnesota – 9.0
  • New Jersey – 9.0
  • Iowa – 9.4
  • Hawaii – 9.8
  • Vermont – 9.9
  • Nebraska – 10.0

Poverty is low in four of these states because they also have the country’s best economies. They are New Hampshire, Maryland, New Jersey, and Hawaii.

Four states have the fastest growing economies. They are Minnesota, Hawaii, Iowa, and New Hampshire. A growing economy helps reduce poverty.

Three of these states are near a major U.S. East Coast city. They are New Hampshire, Maryland, and New Jersey. . As a result, highly-educated people live in those cities. There is a .

The . It's also the fourth-richest city in the country. States with a high cost of living will have low levels of poverty. The poverty threshold is a national average. People with incomes below that level can't afford to live in these states.

A few states have a universal guaranteed income. That should keep them from having high poverty rates. Alaska has had a guaranteed income program since 1982. The  pays each resident an average of $1,200 a year out of oil revenues. Almost  save it for emergencies.

In 2017, the  declaring that everyone is entitled to basic financial security. It directed the government to develop a solution, which may include a guaranteed income.

In , the seed accelerator Y Combinator will pay 100 families between $1,000 to $2,000 a month. a, is planning a two-year pilot program for fall 2018. It would give $500 a month to 100 local families. It hopes to keep families together, and away from payday lenders, pawn shops, and gangs.

Many argue that the minimum wage should provide a living wage. That's enough to cover food, clothing, and shelter. The common budgeting standard says you should spend no more than 30% of income on housing. federal poverty level The minimum wage is the lowest legal wage companies can pay workers. The U.S. current national minimum wage is $7.25 per hour. For a full-time job, that equates to $15,080 a year. That is more than thefor a single person.

Congress established the minimum wage to stop employers from exploiting desperate workers. In 2016, the  found 2.7% of working Americans earn minimum wage or less. More than half of them are between 16 and 24, and the majority work in the hotel and restaurant business.

In 2018, there are 29 states plus the District of Columbia with rates above the federal level. In those states, you can afford a higher rent. Here's what you could rent if you made the minimum wage in each of those states.