20 Cities With the Widest Gap Between the Rich and Poor

July 8, 2015 by Sam Stebbins

ThinkstockPhotos-112706537The nation’s wealthiest residents have controlled a disproportionately large share of all income for many decades. In 2001, however, that proportion became a majority share. Since 2007, the shares of income controlled by the wealthiest and poorest 20% of households have steadily diverged. In other words, income inequality has been on the rise.

Based on the Gini coefficient, a measure that captures the level of income distribution in a given area, 24/7 Wall St. reviewed the 20 metropolitan areas with the most uneven income distribution, or the highest Gini coefficients. A Gini coefficient of 1 means all income belongs to a single individual, while a coefficient of 0 reflects a perfectly even distribution. The Bridgeport-Stamford-Norwalk, Connecticut, metro area leads the nation with the worst income distribution.

Click here to see the 20 cities with the worst income inequality. 

According to Josh Bivens, an economist at the Economic Policy Institute, a low or high Gini coefficient can manifest in a variety of ways. The simplest explanation for high levels of income inequality in a given area is high concentrations of extremely high or low incomes. However, the Gini coefficient does not just take into account top and bottom earners. “It is about the whole distribution across the entire run of households or people in an economy,” Bivens said.

With only a few exceptions, the metro areas with the widest gaps between rich and poor residents tend to have lower median household incomes. The majority of the 20 metro areas with the highest Gini coefficients have median household incomes more than $10,000 below the national median of $52,250.Average incomes, however, tell a different story. Because of the uneven income distribution, the average income is much higher in most of these metro areas.

In Bridgeport, Connecticut, which has the highest Gini coefficient of any metro area, the average household income of $137,853 is more than $55,000 higher than the median income, a greater difference than in any other metro area.

Just as very high incomes push the Gini coefficient higher and contribute to high income inequality, so do extremely low incomes. In fact, the poverty rate in 16 of the 20 cities with the highest income inequality exceeds the national rate of 15.8%.

Comparing how much of an area’s income is controlled by the wealthiest 20% and the poorest 20% of households is another way to look at income inequality. In Gainesville, Florida, the lowest-earning 20% of households bring in just 1.9% of the area’s total annual income. The metro area’s most affluent 20% of homes, meanwhile, earn 54% of Gainesville’s total income. This means that one segment of the population earns roughly 29 times more than the same number of households in another.

Inequality in U.S. cities does not always take the same form. In Bridgeport and in Naples, Florida, the lowest-earning 20% of households account for a very small share of income. However, the extremely high incomes earned by the region’s wealthiest citizens primarily accounts for the small share, rather than extreme poverty among the area’s poorest residents. The wealthiest 5% of households in Bridgeport and Naples earn at least $250,000 per year, which is roughly $50,000 more than the minimum earned by the extremely wealthy across the country. Meanwhile, the poverty rates in these metro areas are well below the national figure.

In the other places with high income inequality, the high Gini coefficient is less the result of the presence of very wealthy households and more due to the presence of extreme poverty in the area. In high inequality cities such as Gainesville, Florida and Brownsville, Texas, the lower income limit of the top 5% of earners is well below the national figure. Poverty rates in those cities, on the other hand, are among the highest in the country. Brownsville has the second highest poverty rate in the country with 32.5% of residents living below the poverty line.

To identify the cities with the widest gap between the rich and the poor, 24/7 Wall St. reviewed Gini coefficients for each of the 381 metropolitan statistical areas (MSA) from the 2013 U.S. Census Bureau’s American Community Survey (ACS). The shares of aggregate household income controlled by each quintile as well as the wealthiest 5% of households, median home value, homeownership rates, median household income, mean household income, poverty rates, and the percentage of people receiving food stamps also come from the ACS. Cost of living, also known as Regional Price Parity (RPP), comes from the Bureau of Economic Analysis (BEA) and is as of 2012, the most recent period available. Annual unemployment rates are for 2014 from the Bureau of Labor Statistics (BLS).

These are the cities with the widest gaps between the rich and poor.

20. Durham-Chapel Hill, NC
> Gini coefficient:
0.499
> Median household income: $53,492
> Poverty rate: 16.9%
> Pct. earning more than $200,000: 7.0%

Income in the Durham-Chapel Hill metro area is less-evenly distributed than income in all but 19 of the other U.S. metro areas reviewed. As is the case across the nation, the wealthiest 20% of area households earn more than half — 53.5% to be exact — of all the income earned in Durham. In contrast, the poorest 20% of households earn just 3% of all the income earned. The wealthiest 5% of households have incomes of at least $230,068, one of the highest incomes for that percentile in the nation. While Durham’s median household income of $53,492 is higher than the national median, the poverty rate of nearly 17% is higher than the national poverty rate of 15.8%.

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19. Johnson City, TN
> Gini coefficient:
0.503
> Median household income: $37,423
> Poverty rate: 19.3%
> Pct. earning more than $200,000: 1.9%

While the wealthiest people in the Johnson City metro area account for the vast majority of income, even the city’s highest-earning households are not especially affluent. The median household income of $37,423 is well below the national median of $52,250. And even the incomes among the wealthiest 5% of households, who earn at least $140,986 annually, are substantially lower than the average income for wealthy households in other areas. Still, the top 20% of households earn nearly 54% of Johnson City’s total income. The area’s income inequality is primarily due to the region’s widespread poverty. Nearly one in five area residents lives in poverty, well above the national poverty rate of 15.8%.

18. New Orleans-Metairie, LA
> Gini coefficient:
0.503
> Median household income: $45,981
> Poverty rate: 19.3%
> Pct. earning more than $200,000: 4.6%

New Orleans-Metairie households in the top income quintile earn at least $98,328 annually. While this is lower than the national income figure, it is about 5.7 times higher than the comparable income among the area’s poorest households. As in many metro areas with the widest income gaps, more than one in 10 households earns an income of less than $10,000 annually, well above the national proportion. In addition, more than 19% of people live in poverty, also one of the higher poverty rates nationwide.

17. Brownsville-Harlingen, TX
> Gini coefficient:
0.503
> Median household income: $34,374
> Poverty rate: 32.5%
> Pct. earning more than $200,000: 2.0%

With the exception of a few extremely wealthy individuals, Brownsville residents are very poor compared to most Americans. The metro area’s poverty rate of 32.5% is higher than any metro area except for McAllen-Edinburg-Mission, which is also in Texas. While goods and services in the area cost nearly 15% less than the national average price, more than 29% of Brownsville households rely on food stamps, the third highest share in the country. Still, the area is home to wealthy individuals. Households in the top 5% of the income spectrum earn at least $139,988, or 5.7 times more than the households earning in the bottom 20%.

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16. Santa Maria-Santa Barbara, CA
> Gini coefficient:
0.504
> Median household income: $62,421
> Poverty rate: 16.3%
> Pct. earning more than $200,000: 7.9%

The Santa Maria-Santa Barbara metropolitan area is the only one on the West Coast among the 20 metros with the widest income gap. In the metro area, the top-earning 20% of households account for over half of the area’s total income, with an average household income of at least $128,464. The top 5% of households all have incomes in excess of $250,000. However, although the area has some extremely affluent residents, even the typical household is relatively well off. The metropolitan area’s median household income of $62,421 is roughly $10,000 above the national median and is among the highest such figures in the country.

15. Staunton-Waynesboro, VA
> Gini coefficient:
0.504
> Median household income: $49,767
> Poverty rate: 11.4%
> Pct. earning more than $200,000: 3.6%

Making a minimum of about $167,700 annually, the highest earning 5% of households in Staunton control nearly 30% of the total income in the area. The lowest earning 20% of households make 3.1% of the area’s wealth, the same (income proportion) as the bottom earning 20% of U.S. households. However, the wealthiest households in the Staunton area control 54% of area income, slightly higher than the corresponding national figure of 51.4%. While Staunton has a higher relative number of high earners, it also has a lower than average poverty rate. Only 11.4% of area residents live in poverty compared to the 15.8% nationwide. Furthermore, only 8.9% of Staunton residents receive food stamp benefits, one of the lowest rates in the nation.

14. Athens-Clarke County, GA
> Gini coefficient:
0.505
> Median household income: $38,227
> Poverty rate: 28.6%
> Pct. earning more than $200,000: 2.6%

The Athens metropolitan area is one of the poorest urban areas in the country. Nearly 30% of the area’s roughly 200,000 residents live below the poverty line, the sixth highest poverty rate in the country. At least a fifth of households earn less than $15,000 per year. Even the wealthiest residents of the Georgia city are relatively less wealthy than the top earners in other metro areas. The wealthiest 5% of homes earn at least $158,606. Across the United States, the top 5% of earners have incomes of at least $200,000 on average. The poorest 20% of households still earned less than one-sixth of the income the top 20% of households earned.

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13. Port St. Lucie, FL
> Gini coefficient:
0.506
> Median household income: $45,322
> Poverty rate: 17.2%
> Pct. earning more than $200,000: 4.2%

The typical household in Port St. Lucie earns $45,322. The average income, however, is nearly $20,000 higher. The reason for that difference is the Florida community’s extremely high income inequality. One-twentieth of the region’s households account for over one-quarter of all the region’s income. The poorest 20% of households account for just 2.9% of Port St. Lucie’s total income. Unlike many of the extremely poor metropolitan areas with high income inequality, the region has a high homeownership rate. More than 70% of homes in the metro area are occupied by their owners.

12. Texarkana, TX-AR
> Gini coefficient:
0.507
> Median household income: $40,382
> Poverty rate: 21.4%
> Pct. earning more than $200,000: 2.7%

In Texarkana, the lowest earning 20% of households bring in just 2.9% of the city’s total income. At the other end of the income spectrum, the wealthiest 20% take home over 53% of the city’s total income. While income inequality is high in Texarkana, the city is disproportionately poor. The cost of living in the region is among the lowest in the nation, and at 21.4%, the poverty rate is significantly higher than the 15.8% national poverty rate. Additionally, the percentage of Texarkana households making more than $200,000 annually is nearly half the 5% portion of households across the entire country.

11. Monroe, LA
> Gini coefficient:
0.508
> Median household income: $37,536
> Poverty rate: 25.3%
> Pct. earning more than $200,000: 3.6%

The highest earning 20% of Monroe’s households earned 52.8% of the area’s total income. The income of the top 20% was more than seven times the income of the bottom earning 20% of households. Not only is there a wide income gap between the wealthy and poor, but Monroe is also home to some of the lowest incomes in the United States. The lowest earning 20% of households take home less than $12,121 a year, significantly less than the corresponding national figure of $21,433. Furthermore, over one-quarter of Monroe’s residents live in poverty — about 10 percentage points higher than the national poverty rate of 15.8%.

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10. Bloomington, IN
> Gini coefficient:
0.509
> Median household income: $42,085
> Poverty rate: 22.7%
> Pct. earning more than $200,000: 3.6%

Before taxes and transfers, income in Bloomington is distributed less evenly than in all but nine other metropolitan areas. Income inequality does not necessarily contribute to a higher level of poverty, but like most cities with the widest income gaps, Bloomington has a high poverty rate with nearly 23% of its residents living in poverty. This is well above the national poverty rate of 15.8%. Despite the sizable income gap, the area’s wealthiest residents are not especially wealthy compared to the wealthiest Americans. The wealthiest 20% of households report incomes of at least $90,484, versus the comparable national figure of $106,101. In contrast, Bloomington’s poorest 20% of households have incomes no greater than $14,175 compared to the national figure of $21,433.

9. Greenville, NC
> Gini coefficient:
0.510
> Median household income: $40,639
> Poverty rate: 25.6%
> Pct. earning more than $200,000: 3.1%

As in a handful of other cities with the widest income gaps, Greenville’s poverty rate of 25.6% is among the higher rates nationwide. Low incomes may be less financially burdensome in the area than in many other regions because the cost of goods and services is more than 10% less on average than their cost across the nation. As in most areas with the most uneven income distribution, households in the top 5% of the income spectrum account for nearly 26% of all income generated in Greenville.

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8. Miami-Fort Lauderdale-West Palm Beach, FL
> Gini coefficient:
0.512
> Median household income: $46,946
> Poverty rate: 17.7%
> Pct. earning more than $200,000: 5.1%

The Miami area has a high concentration of professional and scientific jobs, which tend to have higher salaries. This may explain why some Miami residents have extremely high incomes. More than 5% of the Miami metro area households earn at least $200,000 annually, while 8.7% earn less than $10,000. The wealthiest 20% of households earn 54.5% of all income generated in the area, one of the highest such shares. The poorest 20% of households, on the other hand, account for less than 3% of the area’s entire income. Goods and services cost 5% more than the average cost across the nation, and the high prices are likely more burdensome for the area’s lower-income residents. However, the region, with its easy access to beaches along Florida’s southeastern shore, is still a very desirable place to live. The metro’s population grew 4.4% from July 2010 through July 2013, twice the national population growth rate.

7. New York-Newark-Jersey City, NY-NJ-PA
> Gini coefficient:
0.512
> Median household income: $65,786
> Poverty rate: 14.6%
> Pct. earning more than $200,000: 10.0%

The New York-Newark-Jersey City metro area’s median income of $65,786 is one of the few among areas with uneven income distribution to exceed the national median income of $52,250. Because of the extremely wealthy households the area’s average income is $35,697 higher than the median income at $101,482. The difference, which is the second largest compared to other metros, is the result of high income inequality. One in 10 households earns at least $200,000, twice the national share. While the metro’s poverty rate of 14.6% is slightly lower than the national rate, area residents are more likely to rely on food stamps than most Americans. This could be due in part to goods and services costing about 22.2% more than the national average price level, the second highest cost of living nationwide.

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6. College Station-Bryan, TX
> Gini coefficient:
0.512
> Median household income: $39,657
> Poverty rate: 28.4%
> Pct. earning more than $200,000: 3.0%

The College Station-Bryan metro area is one of three Texas metros with the most unevenly distributed income. The wealthiest 20% of households earn at least $89,292. While this is lower than the comparable national income figure, it is also 6.4 times the highest income among the area’s poorest 20% of households — a larger disparity than in all but one other metro area. Like most metros with the highest income inequality, the College Station metro area’s poverty rate of 28.4% is well above the national poverty rate of 15.8%.

5. Jackson, TN
> Gini coefficient:
0.513
> Median household income: $38,663
> Poverty rate: 20.9%
> Pct. earning more than $200,000: 3.1%

With one of the lowest median household incomes in the country, over half of all of Jackson’s households earn less than $38,663 annually. Of these households, 6.25% earn less than $10,000, one of the highest such proportions of all metro areas in the United States. While 20% of households in Jackson earn a minimum of $81,290 annually, only 3.1% of households make over $200,000. Jackson’s high Gini coefficient is driven largely by a small share of households with extraordinarily high incomes.

4. Gainesville, FL
> Gini coefficient:
0.517
> Median household income: $38,658
> Poverty rate: 26.8%
> Pct. earning more than $200,000: 3.5%

Few American cities have income distribution as skewed as Gainesville, Florida. The wealthiest 20% of households control 54% of the region’s annual income. On the other end of the income spectrum, the poorest 20% of households generate just 1.9% of the region’s total income, the smallest share by the bottom fifth of earners among metros reviewed. This means that the richest fifth of households earns about 29 times more in aggregate than the poorest fifth of Gainesville households. Nearly 15% of the region’s households earn less than $10,000 per year, well above the national share of households in extreme poverty.

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3. Grants Pass, OR
> Gini coefficient:
0.518
> Median household income: $38,298
> Poverty rate: 17.0%
> Pct. earning more than $200,000: 2.7%

With only 83,306 residents, Grants Pass has the smallest population of the 20 cities with the highest income inequality. Workforce mobility can help reduce income inequality. But without it, uneven income distribution is difficult to overcome, as finding higher-paying jobs is more difficult in a weak job market, particularly for lower-income residents. At just over 11%, Grants Pass has the highest unemployment rate among the 20 cities with the highest income inequality. In Grants Pass, nearly 30% of all income goes to just 5% of area households, the highest such share in the nation. On the other end of the income spectrum, the lowest earning 20% of households take home just 3.2% of all income generated in the city. While the average cost of living was lower than the national price level, 24.3% of the city’s population still received food stamp benefits, among the highest percentages and perhaps a further illustration of uneven income distribution.

2. Naples-Immokalee-Marco Island, FL
> Gini coefficient:
0.531
> Median household income: $54,406
> Poverty rate: 12.8%
> Pct. earning more than $200,000: 9.2%

The Naples metropolitan area is home to not only some of the highest concentrations of wealth in the country, but also to the second highest income inequality. Stretching down the southernmost portion of Florida’s Gulf Coast before the Everglades, much of the area is a resort community. The top 5% of earners in the region take home at a minimum of a quarter million dollars annually and control nearly 30% of all income generated in the area. Households with earnings in the top 20% of incomes make over 18 times more than the poorest 20% of households. Unlike most areas with high income inequality, Naples has a relatively low 12.8% poverty rate, 3 percentage points lower than the national poverty rate.

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1. Bridgeport-Stamford-Norwalk, CT
> Gini coefficient:
0.551
> Median household income: $82,084
> Poverty rate: 9.6%
> Pct. earning more than $200,000: 18.2%

Income is less evenly distributed in Bridgeport-Stamford-Norwalk than in any other metro area. Households in the bottom 20% of the income spectrum earned at most $30,493 annually, which was actually one of the highest such figures nationwide. Taken together, those incomes are a fraction of the incomes among the wealthiest households, however, accounting for just 2.3% of income generated in the area. At the same time, the 20% of households with the highest incomes earn nearly 59% of all income generated, the highest such percentage nationwide. Many of these earnings likely come from the 18.2% of area households reporting incomes of at least $200,000, also the highest share in the country. As was the case in a few other cities on this list, relatively high proportions of the area’s workforce was employed by traditionally high-paying industries. The finance, insurance, and real estate, as well as the professional, scientific and management industries accounted for 11.5% and 17% of the workforce respectively — each some of the highest percentages nationwide.

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