These 5 Big Cities Have Virtually No Poverty

October 31, 2018 by Grant Suneson

As set by the U.S. Department of Health & Human Services, the poverty threshold in America is an income of $12,140 for an individual and $25,100 for a family of four. Though the U.S. poverty rate is declining, more than one in eight Americans still live below the poverty line, representing over 43 million people.

In every major metro area in the country, more than 5% of residents live below the poverty line. These households are not evenly distributed across the country. Some areas have struggled with long term economic hardship, and in many of these, more than 20% of residents live in poverty. Other metropolitan areas have benefited from favorable economic conditions, and poverty rates in these cities fall well below the national average.

In five particularly prosperous cities, fewer than 7% of residents are impoverished. 24/7 Wall St. reviewed each major U.S. metropolitan area to determine the cities with the lowest poverty rates.

An area’s educational attainment often is a barometer of the area’s wealth. Adults with at least a bachelor’s degree are more likely to work in higher-paying jobs and earn higher salaries than those without a college degree.

Metropolitan areas with low poverty rates tend to also have low unemployment rates. People who are out of work are at much greater risk of living in poverty than those with a steady income.

Each of the five metro areas with extremely low poverty rates have different thriving industries that employ a large share of area workers. South Dakota has a favorable business climate, so many banks and financial institutions are located in Sioux Falls. Napa, California is known for its wine, and thousands of people work in local wineries and vineyards.

The five cities with the lowest share of residents in poverty are not clustered in a single region, but can be found all across the country: on the West Coast, the East Coast, the Midwest, and Alaska.

To determine the cities with the lowest poverty rates, 24/7 Wall St. reviewed the share of all residents living on poverty level income in 382 U.S. metro areas, as provided by the U.S. Census Bureau’s 2017 American Community Survey.

Click here to see 5 big cities with virtually no poverty.

Source: DenisTangneyJr / Getty Images

5. Appleton, WI
> Poverty rate: 6.9%
> 2017 unemployment: 3.0%
> Median household income: $65,990
> Bachelor’s degree attainment: 29.9%

Appleton, Wisconsin, is one of just five major metropolitan areas where less than 7.0% of the population lives in poverty. A high share of residents are able to find jobs and earn a living for themselves or their families, as the area’s annual unemployment rate is just 3.0% — one of the lowest in the nation and well below the 4.4% national unemployment rate for 2017.

There are several large companies that employ a high share of Appleton’s labor force. As of 2016, 14.8% of area workers were employed by St. Elizabeth’s Hospital and its parent company Affinity Health Systems. Thousands more work in fields such as welding, manufacturing, insurance, and aircraft maintenance. Not only are Appleton residents among the least likely to live in poverty, they are also among the least likely to enter poverty as the result of an unexpected health crisis. Just 3.6% of Appleton residents have no health insurance. Nationwide, 8.7% of Americans lack health insurance coverage.

Source: Thinkstock

4. Sioux Falls, SD
> Poverty rate: 6.8%
> 2017 unemployment: 2.8%
> Median household income: $64,882
> Bachelor’s degree attainment: 32.2%

As a result of a favorable business climate, South Dakota is an ideal location for banks and other financial institutions. Some 10.6% of Sioux Falls area workers are employed in the finance and insurance field — one of the highest shares of any metro area in the country. Wells Fargo and Citi are two of the largest employers in the state’s largest metro area.

The area’s largest employers, however, are in the biomedical sector. More than 8,000 Sioux Falls employees work for Avera Health, and over 9,500 are employed by Sanford Health. These financial and biomedical professions require a high degree of specialization and tend to pay well. The Sioux Falls area’s median household income of $64,882 a year is more than $4,500 higher than the national median.

Source: Susan Viera / Getty Images

3. Barnstable Town, MA
> Poverty rate: 6.8%
> 2017 unemployment: 4.4%
> Median household income: $71,235
> Bachelor’s degree attainment: 44.6%

Areas with a high level of education tend to be more affluent than areas with lower levels of education. In the Barnstable Town metro area, 44.6% of adult residents have at least a bachelor’s degree. Nationwide, just 32.0% of American adults have finished college with a four-year degree. The Barnstable Town area’s median household income of $71,235 a year is over $10,000 higher than the U.S. median household income of $60,336.

The Barnstable Town metro area encompasses all of Cape Cod, the famously affluent beach area of Massachusetts. Unlike the other cities with the lowest poverty rates in the country, the area’s poverty rate actually increased from 2016 to 2017. The area’s 2017 poverty rate of 6.8% is 0.3 percentage points higher than it was the year before.

Source: Thinkstock

2. Fairbanks, AK
> Poverty rate: 6.0%
> 2017 unemployment: 6.3%
> Median household income: $76,747
> Bachelor’s degree attainment: 29.6%

The Fairbanks, Alaska, metro area has the second lowest poverty rate in the country as well as the lowest incidence of extreme poverty. Just 2.8% of Fairbanks area households live on less than $10,000 annually. No other area has an extreme poverty rate below 3.0%. In 2016, Fairbanks’ poverty rate was nearly 10%. The 3.9 percentage point decline is one of the greatest in the country.

This low level of poverty is somewhat surprising given the area’s 6.3% unemployment rate, which is well above the U.S. unemployment rate of 4.4%. Alaska functions somewhat differently than the lower 48 states. Its residents are paid an annual dividend via the Alaska Permanent Fund, which takes revenue from oil companies and gives it to residents to defray some of the state’s high cost of living.

Source: KarenWibbs / Getty Images

1. Napa, CA
> Poverty rate: 5.6%
> 2017 unemployment: 3.7%
> Median household income: $86,562
> Bachelor’s degree attainment: 36.2%

Napa, California, has the lowest share of residents living in poverty of any major metropolitan area in the country, at 5.6%. The Northern California area’s median household income of $86,562 a year is one of the highest in the country and more than $26,000 higher than the national median household income. The Napa area also has the lowest share of people who use government assistance to buy food. Just 3.3% of Napa area residents used SNAP benefits in the past 12 months.

Many Americans typically associate Napa with the surrounding Napa Valley and the area’s wineries. There are nearly 500 wineries in the area contributing more than $9 billion to the local economy, according to the Napa Valley Vintners. Along with the wine industry and other associated tourism jobs, the Napa Valley school district, local government, and medical and nursing jobs account for a large share of the area’s employment.