Economist Sar Haribhakti recently highlighted a significant disparity in poverty and homelessness, noting that states with a higher cost of living, such as California and New York, exhibit higher rates of destitution compared to states like Alabama and Mississippi. This observation challenges conventional perceptions of poverty distribution across the United States. Haribhakti emphasized this point in a social media post, stating, > "That California and New York have higher poverty rates than Alabama and Mississippi may turn heads, but the patterns align with some other measures of destitution."
The Supplemental Poverty Measure (SPM), which accounts for geographic differences in the cost of living and various government programs and expenses, provides a clearer picture. In 2022, California's SPM rate stood at 13.2 percent, while New York's was 13.7 percent, both exceeding their respective official poverty rates. Conversely, Alabama recorded an SPM rate of 12.0 percent and Mississippi 14.8 percent, which were lower than their official poverty figures, according to data from the U.S. Census Bureau. This adjustment for cost of living reveals a different landscape of economic hardship.
The trend extends to homelessness statistics, where high-cost states show significantly higher numbers. In 2023, California reported the highest number of people experiencing homelessness nationwide with 181,399 individuals, followed by New York with 103,200, based on the Point-in-Time count by the National Alliance to End Homelessness. In stark contrast, Alabama registered 3,797 homeless individuals, and Mississippi reported 1,184, illustrating the acute impact of housing affordability in more expensive regions.
New York City, in particular, faces a severe homelessness crisis, with record highs in its homeless population. The Coalition for the Homeless reported approximately 88,000 people, including 33,000 children, sleeping in the city's main municipal shelter system nightly in December 2023. Haribhakti underscored this urban challenge, noting, > "The city where nearly 1 in 7 public school students experience homelessness each year is New York City — not Huntsville, Alabama, or Jackson, Mississippi." This persistent issue affects tens of thousands of students annually within the city's public school system.
These figures highlight how the high cost of housing and living expenses in major metropolitan areas and coastal states can exacerbate financial strain, pushing more individuals and families into poverty and homelessness despite potentially higher average incomes. The data suggests that traditional poverty metrics often fail to capture the full scope of economic hardship when not adjusted for regional economic realities. The analysis by Sar Haribhakti serves as a crucial reminder to consider localized economic factors when assessing societal well-being.
