Detailed Findings

The Supplemental Poverty Rate is higher than the official poverty rate in 19 states. Among those states, the differences range from as little 0.1 percentage points in Arizona to 5.6 percentage points in California.

In many of these states, high housing costs — housing costs are not factored in the official poverty rate — likely explain the higher SPM. In nine of the 10 states where the SPM exceeds the official poverty rate the most, the median home value is higher than the value of the typical American home of $217,600. In those same nine states, the average cost of goods and services is higher than it is nationwide.

When it comes to measuring poverty, the importance of accounting for cost of living is difficult to understate. In California, for example, factors such as these drive the poverty rate up from 13.4%, lower than 15 other states, to 19.0%, the highest SPM in the country. In New Jersey, the poverty rate goes from 9.7%, one of the lowest in the country, to an SPM of 15.1%, one of the 10 highest.

On the other hand, accounting for cost of living and housing costs can also lead to an SPM below the official poverty rate in less expensive states. In all 10 states where the SPM is the lowest compared to the official poverty rate, median home values and overall costs of living are lower than the national averages.

While the SPM is more comprehensive than the official poverty rate as a tool for determining how widespread financial hardship is, it also reveals the official poverty rate’s efficacy as a means of alleviating financial hardship.

The government uses the poverty line to determine who should receive subsidies like SNAP benefits — and though it is one of many factors, high SNAP recipiency rates are common in places where SPMs fall below the official poverty rate. This suggests that the official poverty rate works — at least to a degree — in alleviating some financial stress.

For example, in New Mexico, where the 15.2% SPM is 3.5 percentage points below the official poverty rate, 17.4% of households receive SNAP benefits — the highest recipiency rate in the country. Similarly, in West Virginia, 16.8% of households receive SNAP benefits, the second highest recipiency rate among states. West Virginia’s SPM is 2.3 percentage points below its official poverty rate of 16.6%. Meanwhile, relatively few states where SPMs are higher than the official poverty rates have higher than average SNAP recipiency rates.

Methodology

To identify the states where poverty is worse and better than you think, 24/7 Wall St. reviewed states where the supplemental poverty rate (SPM) is highest compared to the official poverty rate. We also reviewed states where the SPM is lower than the official rate. These data are three-year averages through 2017 from the U.S. Census Bureau’s Current Population Survey. Median household income and SNAP recipiency rates are from the U.S. Census Bureau’s American Community Survey for 2017. 2016 Regional price parities, or costs of living, came from the Bureau of Economic Analysis.