Special Report

The States with the Widest Gap Between Rich and Poor

10. Mississippi
> Gini Coefficient: 0.468
> Median Income: $36,851 (the lowest)
> Households Earning $200,000+: 2.1% (2nd lowest)

> Population Living Below Poverty Line: 20.8% (highest)

Mississippi has the 10th-worst income inequality in the U.S. This is an improvement from sixth-worst in 2009. The state has traditionally been one of the poorest in the country. In 2010, Mississippi had the lowest median income at $36,851. It also had the highest poverty rate, with more than 20.8% of households living below the poverty line. Just 81.6% of residents 25 and older have a high school diploma, one of the lowest percentages in the country. While the state has the second-lowest percentage of households in the highest income bracket, which helps lowering its income inequality, it has a nation high 7.7% of households earning less than $10,000 each year.

9. Georgia
> Gini Coefficient: 0.468
> Median Income: $46,430 (21st lowest)
> Households Earning $200,000+: 4.2% (19th highest)
> Population Living Below Poverty Line: 16% (tied for 10th highest)

Though income remained stratified, prosperity in Georgia increased as a whole between 2009 and 2010. During that time, median income rose by $3,090, and the percentage of households earning more than $200,000 rose from 3.43% to 4.2%. In many other regards, Georgia’s economic improvements have been marginal. The percentage of the population below the poverty line fell only slightly, from 16.5% to 16%. Further, the unemployment rate remained high through 2010, at 10.2%, while 20.6% of households earned less than $25,000, the 11th-highest percentage among all 50 states.

8. Texas
> Gini Coefficient: 0.469
> Median Income: $48,615 (24th highest)
> Households Earning $200,000+: 4.8% (16th highest)
> Population Living Below Poverty Line: 15.7% (12th highest)

Texas has the eighth-worst income inequality in the U.S. — an improvement from third worst in 2009. Median income in the state increased from $47,475 in 2009 — when it was the 22nd lowest — while the poverty rate fell from 17.2%, which was the eighth highest in the country at the time. Just 81% of Texans 25 and older have a high school diploma, the second-lowest percentage in the country. Texas is among the five most populous states in the country, a factor that correlates highly with income inequality. According to a recent article in the Texas Tribune, part of the state’s high income inequality can be attributed in part to its Mexican border communities.

7. California
> Gini Coefficient: 0.471
> Median Income: $57,708 (9th highest)
> Households Earning $200,000+: 7.2% (7th highest)
> Population Living Below Poverty Line: 13.8% (23rd highest)

In 2010, California had the seventh-highest proportion, among all states, of households earning at least $200,000 annually. Simultaneously, 397,626 households earned less than $10,000 annually, more than any other state. Though only the 21st highest proportion among states, the sheer number of impoverished families represents a major problem for California. Similarly, while the proportion of households living below the poverty line of 13.8% is not remarkably high compared to other states, California households have the highest average household size of any states on this list. Fixing California’s problematic income gap likely will require an improvement in the state’s unemployment rate, which stood at 12.4% in 2010, the second-worst rate in the nation.

6. Alabama
> Gini Coefficient: 0.472
> Median Income: $40,474 (5th lowest)
> Households Earning $200,000+: 2.9% (tied for 11th lowest)
> Population Living Below Poverty Line: 18.1% (tied for 2nd highest)

Alabama has the sixth-worst income inequality in the nation. Median income in 2010 has increased from $39,980 in 2009, when it was the third lowest in the country. However, the poverty rate also has increased from 2009’s level of 17.5% to become the second highest in the country, at 18.1%. Some 14.3% of the state’s residents rely on food stamps, the eleventh-highest percentage in the country.