Why must we insist on always looking at the negative? When we saw there was a really high number of searches for ‘poorest states’, we thought – well, we have to give people what they want. So here you go.
Being poor in America isn’t fun, that’s for sure. With people all around us humble bragging on Facebook, and the negative stigma that comes with taking a handout, not having a lot of money is the pits.
America is by far the richest country in the world, when you measure total wealth across the board. When you measure average income per resident by country, Americans are the 6th wealthiest. Switzerland is Mr. Moneybags around these parts. The poorest place in earth? Believe it or not, but there are 5 countries in Africa where folks make less than $1,000 annually.
Still feel poor now?
Here in the us the average poverty rate for a state is 13%, down a full one percentage point over th last several years. Most of us are fairly comfortable. However, today, we’re going to look at the poorest states in America and put some perspective on income levels. Then we’ll try to give these states a little motivation and help them feel a bit better about their situation.
What’s the poorest state in America for 2020? It turns out Mississippi is the poorest state in the country. Mississippi is having a rough week since we also just named it one of the worst states in America for 2020.
The purpose of this study is to use science to determine which of our great American states are the absolute worst. While unbiased, this research does take into account factors that almost all Americans would agree are undesirable. We get it – knowing the extremes helps put things into perspective; if we know where the poorest and richest places are, we can understand our lives easier. It’s a psychological thing.
At the end of the day, we ended up with this list of the poorest states in the US.
Read on below to see how we crunched the numbers and how your state ranked. Or check out more on the poorest cities to live in America.
For more reading, check out:
The 10 Poorest States In America For 2020
We’re in Mississippi, the nation’s first poorest state. In Mississippi, 20.8% of people live in poverty, meaning nearly 1 in 4 families earns less than about $25,000 annually. That’s the same poverty rate as the African nation of Namibia. That’s poor. Factors that contribute to the very poor atmosphere here are a 8.22% unemployment rate, and up until a couple years ago, 1 in 4 Mississippians wasn’t finishing high school. Hard to get ahead when you don’t study.
When you google mississippi, the first auto suggest is why is mississippi so poor. SO why is Mississippi so poor? For many of the reasons we’ve already talked about before. It’s just worse here than anywhere else. Poor education and limited job opportunities are a big factor. High incarceration rates and a history of racial segregation has held back a large percentage of the population. For many Mississippians, it’s a generational problem. And for quite a few of them, a government safety net of welfare and unemployment makes being poor a lifetime goal.
There are limitless opportunities in Mississippi, as there are in the other states on this list. Being poor is not a life sentence. While these states have large populations that have been poor for ages, it doesn’t have to be so.
In New Mexico, 20% of residents live in poverty, and families bring in about $46,000 a year. That’s about $10,000 less than the national average. 1 in 3 kids lives in poverty here, which is one big reason New Mexico ranked last in the nation for places to raise a family.
Native American reservations and illegal immigrants pad the poverty numbers here, too.
When you look at the nation’s most federally dependent states, New Mexico is at the top. That means New Mexico can’t collect enough from income taxes, and must rely on federal subsidies to help pay for schools, roads, health care and welfare programs.
And we just talked about Louisiana – they receive the MOST assistance from the US government to make up THEIR state budget.
Apparently, things are getting worse in New Mexico, not better. More young working age adults are leaving the state than coming into it, which means more and more federal assistance will be needed down the road.
There’s hope though ,It’s not like there aren’t success stories coming out of New Mexico… Microsoft was founded in Albuquerque and Jeff Bezos grew up in Albuquerque.
We’re heading back to the south where we will remain for most of the rest of our unwealthy excursion. The next stop takes us to Louisiana. Too bad we don’t have enough money to buy booze – they look like they’re having so much fun.
Here, more than 19% of residents live in poverty, and families command a yearly paycheck of around $46,000. That’s not enough for many people here to climb the success ladder.
Other statistics that are eye-opening? Louisiana is last in the nation for income gap by gender. Louisianans are 3rd worst for food insecurity and 3rd worst for education scores. The last statistic makes it tough to entice job growth, since the state doesn’t have the educated population to support it.
Corporate subsidies aren’t helping things in Louisiana. Look at this graph that depicts how much taxpayer money goes from public to private coffers in the Pelican State.
Louisiana’s abundant natural resources is a blessing and a curse. While the state enjoys the windfalls that come with oil and natural gas extraction, many of its residents have become dependent on the energy sector for a paycheck. And It won’t last forever.
There’s a sense of fatalism in Louisiana, too. Poor people just remain…poor here. It is what it is they say. All we can do is pray they say. There’s little urgency here to seek change.
Even though you’re poor, there’s still plenty to do on a budget. Like…actually no all of these things suck. Being broke means you can’t do fun stuff. Never mind.
The poverty rate is 18% in West Virginia, and families bring in about $44k a year – both very low numbers. However, a couple bright spots keep West Virginians from ranking as even poorer. The unemployment rate isn’t so bad here, so that’s good. And the cost of living is so low here that low salaries mean more families can get by and remain out of poverty.
However, when Walmart is your state’s biggest employer, that’s indicative of a struggling worker base.
West Virginia is in a tough spot. It’s a beautiful state, but all those rolling hills means it’s hard to build big cities and industry. And prescription meds and booze have taken a toll on a large part of the population – West Virginia ranks first in the nation for overdoses.
Migration studies have shown that 60% more people moved out of West Virginia than moved in. And, West Virginia is the only state where death rates exceed birth rates.
Lots of people in Alabama are bro to the oke. Families here bring in about $46,000 as a household annually – earning about $1,000 less than the average household each month. And about 1 in 5 residents lives in poverty here.
Why is Alabama so poor? Like other states we’ve talked about so far, one side will say unregulated capitalism has created severe poverty here. Other sides will say Alabamans aren’t working hard enough – and can control their own financial fate.
We’re not going to take sides on this, but the poverty is alarming nonetheless. In many Alabama counties, it looks third world, where poverty rates reach 40%.
Alabama’s generational poverty is having an impact on the long term well being of its residents. Many of these poorest counties are also the fattest counties in the state, proof that cheap food is bad for us.
The United Nations usually does research on poverty across the world, but recently, visited parts of America to see how bad poverty is here. Their first stop? Alabama. Their report was quite compelling, and discussed conditions similar to what we see abroad.
You know who isn’t poor in Alabama? Their head coach. He made $11 million last year – more than any other public figure in the state. I guess you get what you pay for – Alabama has been winning national titles left and right lately.
Kentucky residents earn the 5th lowest salaries in the nation – at $46k a year. And 1 in 5 Kentucky peeps lives in poverty. If there is a bright side here, at least the unemployment rate is about average. So there are opportunities here to get ahead here.
Just about every state has its haves and have nots. Here in Kentucky, the Bluegrass area that consists of Louisville, Lexington and Cincinnati suburbs are all doing just fine. Several large companies make their headquarters here.
But the rest of Kentucky is pretty broke. The coal mines of eastern and western Kentucky are in decline, as is the tobacco industry. Small towns outside of Kentucky’s urban areas are fading from importance – and 2 in 3 people in Kentucky lives in these boonies.
There’s ways you can get out of the poorhouse, Kentucky guy. People make like $50 a week giving blood, but you have to donate good blood. I don’t know if there’s more meth or mountain dew running through a Kentucky man’s veins.
If you’re living in Section 8 or Section 1, keep your head up, Kentucky. After all, This guy was poor and he ended up saving a whole kingdom. And HE was broke as hell, but he wound up being the star on a kid’s television show.
Yeah I’m proud to be a coal miner’s daughter.
We’ve arrived in South Carolina, the 7th poorest state in America. We’ll grab something off the dollar menu cause that’s all we can afford tonight.
South Carolina peeps are straight strugglin. They have a poverty rate of 16.9%, households bringing in less than $50,000 annually, and 90% of working adults here live paycheck to paycheck.
In America, 75% of full-time workers live paycheck to paycheck. That’s a real big difference.
Many of the problems in SC stem from a lack of good genes. No that’s mean. The real issue here in South Carolina is complex. For instance, Rural South Carolina communities that rely heavily on agriculture are so broke that locals have dubbed the area the Corridor of Shame.
As we’ll see as we continue to move through this list, most of our poorest states are in the south. There are many theories as to why the south is so poor, but many economists agree that going back to Civil War days, the northern states invested in infrastructure and technology, while the south remained committed to farming. As a result, education fell behind, as did the southern economy.
But if you ask people in places like South Carolina if they ‘think’ they’re poor, many will likely tell you ‘no.’ On paper, they don’t have a lot, but a simple life with God, friends and family nearby is all they need.
Next on our list of poorest states in America is #8 ranked Arkansas. Here in Arkansas, a lot of bank accounts are empty. The Natural State has an 17.6% poverty rate, and families bring in about $45,726 a year. We should note, here in Arkansas, smaller paychecks can be stretched much further than in other states, but it’s still tough times here.
Arkansas used to be pretty much the poorest place in the country, but they’re not as poor as before. Back in the 1940s, nearly half of all Arkies lived in poverty. So that’s good – economically, slowly, things are improving here. Of course not everyone grows up poor here. The Clintons are from Arkansas, and they’re certainly not broke. Sam Walton is totally loaded, too. He’s from Arkansas, and is the founder of Walmart.
Tennessee is an interesting state. It ranks as the ninth poorest in the nation, but has varying levels of wealth across the state. Nashville and Germantown are all filled with wealthy, successful people, but also have some high levels of income inequality. The rest of the state population is pretty poor and way underemployed relative to the rest of the country.
You could drive three hours and see completely different pockets of success in Tennessee. The poverty level sits at 16.1%, while unemployment measures 5.91% — the 23rd worst in the country. People here work very, very hard, but due to the lack of thriving new technology, and a relatively poor education system, it remains one of the poorer states in the nation.
On the brighter side, Tennessee is starting to get its crime rates under control and has some of the more up and coming cities in the country.
Here in my home state, the poverty rate is a full 16%, which is 3% higher than the national average. Folks bring in about $50,000 annually – good for the 11th lowest amount in the US. For perspective, people in the richest state, Maryland, earn about $25,000 more each year than in North Carolina.
Now, I live here, and I know where the rich and poor pockets are located. Much of the wealth is in the Charlotte area, in the Raleigh-Durham-Chapel Hill region (called the Triangle), and along the coast. There are large areas in the Tar Heel State where folks are down on their luck. They seem happy though.
North Carolina is a purple state – pretty much a 50-50 split between those with good jobs and those with lousy ones – or without jobs at all.
Things are looking up here; North Carolina is the nation’s 10th-fastest growing state. Many wealthier families are moving here because of the large number of technology and healthcare jobs sprouting up. So, I can imagine this state won’t be on this list too much longer.
How We Determined The Poorest States in the US
The first thing that comes to most people’s minds when they think about determining the poorest places is to simply the poverty rate. That is, the number of people living below a federally established level of income for a household of a certain size.
However, we don’t think that one statistic wholly encompasses what it means to be one of the ‘poorest states’. So we looked at this set of criteria from the newly released 2014-2018 American Community Survey:
- Poverty level
- Unemployment rate
- Median income
The unemployment rate tries to capture the prospects for improvement in the city or town. If more people are employed, the brighter the future looks and vice versa.
We ranked each state from 1 to 50 for each of the criteria, with 1 being the poorest. We then averaged all the rankings for a state into a ‘Poor Score’ with the state having the lowest overall Poor Score crowned the ‘Poorest State In The US For 2020’. You can download the data here.
If you’d like to see the complete list of states, from poorest to richest, scroll to the bottom of this post to see the unabridged chart.
There You Have It — The Poorest States In The Country
If you’re poor in America, there are heart warming rags to riches stories all over he place that you can use as inspiration. Slumdog Millionaire, Pretty Woman, heck even Annie. Most people are probably not going to get adopted by someone, but we’d be willing to bet if Americas poorest states changed their policies, their situations would follow suit.
If you’re curious enough, here are the richest states in the USA, according to science. Apparently, things are ‘all that’ when it comes to northeast America:
- New Hampshire
For more reading, check out:
What Are The Poorest States In America For 2020?