The wealth gap in America continues to fuel debate across the country. Recent studies have shown that the top 10% of Americans have 10 times the wealth of the bottom 50%. As well as the economic gap between citizens, there is a big difference between rich and poor American states. Here are the 25 poorest states in the USA.
Mississippi
Mississippi is consistently ranked among the poorest states in America and currently sits at the bottom of the list.
West Virginia
The second state on our list faces extreme economic struggles due to the demise of the state’s coal industry, leading to a lot of unemployment among its workforce.
New Mexico
In 2023, New Mexico reportedly had the third-highest poverty rate in the country for the third year in a row. In particular, the state ranks among the most economically deprived for people aged 65 and older.
Louisiana
Louisiana’s poverty problems have only been made worse by the state’s exposure to natural disasters like Hurricane Katrina, which impoverished communities have still not recovered from.
Arkansas
Like many of the states on this list, Arkansas’ economy is heavily reliant on industries like agriculture, which tend to offer low wages and are an obstacle to growth and opportunities.
Alabama
A shocking statement was made by a UN official in 2017. He said that the poverty he witnessed in Alabama at that time was more than anything he’d ever seen in the developed world. While the statistics show that things have marginally improved since then, Alabama is still one of the poorest places in America.
Kentucky
Despite the opulent wealth on display every year at the Kentucky Derby, the reality of life for many in the state is much less glamorous. Studies have suggested that issues such as substance use, addiction, and a mental health crisis are among the reasons for Kentucky’s economic turmoil.
South Carolina
South Carolina’s economy has suffered for years due to citizens struggling to find work. This reached its peak after the 2008 crash, with unemployment levels hitting as high as 12.1% in late 2009. Although that number then started to fall, unemployment has been on the rise again since 2019.
Oklahoma
The Oklahoma Policy Institute reported a few years ago that the state leads the nation in food insecurity, meaning more Oklahomans can’t afford food than any other state. This, along with several other health issues, limits the earning potential of workers and damages the economy.
Montana
A relatively unique problem that Montana faces in terms of its economy is the sheer lack of people, and therefore workers. The state has one of the lowest population densities in the USA. There is also a sizable economic gap when comparing Montana’s cities and rural areas, with the latter seeing little to no growth as an increasing number of residents move away.
Missouri
Between 2007 and 2012, Missouri’s poverty rate increased by almost 3%. Although the rate started to decline in the following years, issues such as education, health, housing, and energy continue to pose problems.
North Carolina
North Carolina has seen its poverty rate make some slight progress in recent years. But the state’s economy continues to struggle in other ways. The median household income in 2018 was $53,000 a year. Adjusting for inflation, this means that the typical North Carolina household brought in the same amount of money as it did in 2007.
Idaho
A somewhat surprising addition to the list, Idaho scores well in several economic indexes, such as its economic outlook, in which it ranks second in the country. However, Idaho experiences comparatively low per capita income, which leads to a higher poverty rate. This has resulted in other problems in areas like education, where Idaho was ranked 39th across all states in 2019.
Arizona
In 2021, CNBC reported that Arizona was ranked as the number 1 worst place to live in America. This was put down to a lack of public funding, particularly in health. Despite its natural beauty, Arizona scored poorly across all metrics imposed in the study.
Georgia
Like some other states on this list, Georgia’s poverty is particularly noticeable in its rural areas. Less than a quarter of the population lives in these areas, and reports suggest this proportion is shrinking all the time.
Indiana
Indiana has ranked particularly poorly in healthcare studies due to high costs. The state’s poverty levels have worsened as traditional industries such as steel have faded away in Indiana cities such as Gary, which has seen its poverty rate skyrocket to 150% higher than the US average.
Michigan
Like Indiana, Michigan used to be a thriving hub of industry, particularly in Detroit, the spiritual home of America’s car industry. But the decline of manufacturing, as well as issues like inflation, environmental contamination, and the impact of COVID-19 have forced Michigan to its knees.
Ohio
The year 2023 saw poverty levels in Ohio rise for the first time in over a decade. This was put down to three main factors: the COVID-19 pandemic, a shortage of mental health care, and problems with public transport.
Pennsylvania
The pandemic affected every state, but some struggled more than others to recover. In 2021, Pennsylvania reportedly lagged behind most states in this respect and experienced one of the largest economic contractions in the country.
South Dakota
The desperate economic situation in several counties in South Dakota has been put down to several factors, including the state’s isolated location and the particular plight faced in informal subregions populated by Native American groups.
Tennessee
Tennessee has recently faced criticism for being among the lowest-ranking states for helping families and children living in poverty. Poverty also affects Tennesseans’ ability to look after their health, with 23% of low-income women lacking any health insurance.
Utah
At first glance, Utah appears to be doing pretty well financially. The state’s economic outlook has topped rankings in America for 15 years in a row. But this doesn’t paint the full picture: underspending in education and a serious housing shortage have contributed to unforeseen economic problems.
North Dakota
Between 2018 and 2020, nearly a third (30%) of North Dakotans fell into the categories of poor or low-income. The effects of low income snowballed thanks to other problems in the state, such as high energy costs, with low-income citizens spending 6 times as much of their salaries on energy costs than the average household.
Wisconsin
Like many states, Wisconsin’s poverty levels are not spread equally across demographics. For example, 64% of Black households fell below the ALICE Threshold for Financial Survival in 2021. Age was also a determining factor, with more than half of households headed by someone under 25 falling below the same threshold.
Wyoming
Despite its proud history as “The Equality State,” Wyoming now seems less equal than ever. The state has become a haven for the ultra-rich looking for a scenic getaway, while locals have struggled to make ends meet. One of the biggest industries in the state, energy, saw 1 in 5 jobs disappear in the wake of the COVID-19 pandemic.
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