In the United States, inflation has started rising in early 2021. And while the consumer price index has been falling steadily for nearly a year, inflation remains very high at 4.9% – more than double the Federal Reserve’s 2% target rate. Despite rising incomes, in this economic climate, American households are poorer now than they were two years ago.
While the rising cost of living has spared no one, low-income households are feeling the effects disproportionately. Low-income Americans spend a greater proportion of their income on basic necessities such as food, transportation and housing, and therefore have fewer opportunities to cut back on spending.
A recent US Census Bureau survey found that 33% of households earning less than $35,000 a year found it very difficult to pay for common household expenses in the past week, up from 15% of all US households reporting similar challenges. more than double. Additionally, nearly two-thirds of households earning less than $35,000 found rising prices “very stressful,” compared to less than half of all American households.
This period of historic inflation is taking a substantial toll – both economically and psychologically – on many of the country’s most vulnerable communities.
Using five-year projections from the U.S. Census Bureau’s 2021 American Community Survey, 24/7 Wall Street identified the poorest city in each state. We considered any city, town, or unincorporated community with a population between 1,000 and 25,000 people and ranked them by median household income.
In the places on this list, the typical household earns anywhere from $43,800 to $9,100 annually. For context, most American households earn over $69,000 per year. With such low incomes, residents of these places are more likely to rely on government assistance to afford basic needs. In all but two of the communities on this list, the share of households receiving SNAP benefits or food stamps exceeds the respective statewide receipt rate. (Here’s a look at the city in each state with the most people on food stamps.)
The low incomes in these communities are often reflected in the local housing market. In more than half of the locations on this list, the typical home costs less than $100,000. (Here’s a look at the cheapest cities to buy a home.)
Click here to see the poorest city in each state.
Click here to view our detailed methodology.