States With the Widest Gap Between Rich and Poor

Print Email

4. California
> Gini coefficient:
0.489
> Median household income: $61,933 (9th highest)
> Households earning $200,000+: 8.1% (5th highest)
> Poverty rate: 16.4% (17th highest)

California, home of Hollywood mansions and the impoverished Central Valley, is sharply divided along income lines. The state’s median home value of $412,700 is the second highest in the country, and roughly one in 10 California homes are worth more than $1 million, the highest such proportion nationwide. The Fresno, Modesto, and Bakersfield-Delano metro areas make up the Central Valley — one of the nation’s largest sources of food and among the poorest areas in the country.

While the state’s poverty rate of 16.4% is only slightly higher than the national poverty rate of 15.5%, the level of poverty in California may be higher when living costs and other factors are taken into account. Using the supplemental poverty measure, which factors in government benefits and certain living expenses, California’s poverty rate is closer to 25%, or one of the highest in the country. Many Californians on the low end of the income spectrum are likely among those who did not complete high school. Just over 82% of adults have a high school diploma, the lowest percentage in the country.

ALSO READ: America’s Most and Least Educated States: A Survey of All 50

3. Louisiana
> Gini coefficient:
0.490
> Median household income: $44,555 (7th lowest)
> Households earning $200,000+: 3.6% (25th lowest)
> Poverty rate: 19.8% (3rd highest)

Nearly one in five Louisiana residents live in poverty, the third highest proportion. The high rate is at least partially attributable to Louisiana’s poor income distribution, which is third worst nationwide. While 3.9% of U.S. workers earn the minimum wage or less, 6.3% in Louisiana workers earn so little, also the third highest proportion. The prevalence of minimum wage jobs is likely because of the prevalence of low-paying retail trade jobs — the sector employs 12.3% of workers statewide, the 10th highest share compared to other states.

2. Connecticut
> Gini coefficient:
0.500
> Median household income: $70,048 (4th highest)
> Households earning $200,000+: 10.0% (2nd highest)
> Poverty rate: 10.8% (3rd lowest)

Connecticut trailed only New York in income inequality. The wealthiest 5% of Connecticut residents earned more than one-quarter of all income earned in the state, the largest share of income earned by the top 5% after only New York. The share of total income held by Connecticut households in each of the bottom four quintiles are all nearly the lowest compared to other states.

Even with the disparities in income, Connecticut residents are relatively well off. A typical household in the state earns more than $70,048 annually, nearly the highest median household income nationwide. Only 10.8% of people live in poverty, and 6.0% of households have incomes less than $10,000, each among the lower rates compared to other states.

ALSO READ: 10 Cities Where You Don’t Want to Get Sick

1. New York
> Gini coefficient:
0.511
> Median household income: $58,878 (16th highest)
> Households earning $200,000+: 7.6% (7th highest)
> Poverty rate: 15.9% (19th highest)

Income is distributed less evenly in New York than in any other state. The percentages of households earning less than $10,000 and more than $200,000 annually, at 8.1% and 7.6% respectively, are each well above the national shares, one of only two states where this was the case. New York was also one of only two states where more than one-quarter of all income belongs to the wealthiest 5% of residents. Nearly 54% of all income is earned by the wealthiest 20% of income earners, while the poorest 20% earn just 2.6% — the highest and lowest percentages of income earned by the two income groups, respectively.

Massive wealth gaps in New York City, which is home to 43% of New York residents, likely accounts for the state’s nation-leading Gini coefficient. The city is both the largest and most unequal in the United States.