California and Louisiana both record among the highest poverty rates in the United States when housing costs, taxes, medical expenses, and government benefits are included in the calculation, according to data from the Census Bureau. This finding shifts the traditional geographic perception of poverty, which has historically concentrated in Southern states, by revealing that high cost-of-living areas face significant financial strain once broader economic realities are measured.
Axios analyzed state poverty estimates from 2023 to 2025 provided by the Census Bureau to compare two distinct measurement methods. Under the traditional official measure, which compares pretax cash income against a fixed family-size threshold regardless of location, Louisiana had a poverty rate of 19.6%. California’s rate under this same metric was 10.7%, while New Hampshire recorded the lowest rate at 5.4%. The South dominated these traditional rankings, containing 10 of the 11 states where the poverty rate significantly exceeded the national average.
The landscape changes when applying the Supplemental Poverty Measure (SPM), a broader metric that accounts for geographic differences in housing costs, subtracts work and medical expenses, and factors in taxes, tax credits, and benefits such as SNAP and housing assistance. Under the SPM, California’s poverty rate increased by nearly two-thirds to 17.8%. Louisiana remained near the top of the rankings at 19%. Conversely, Maine posted the lowest SPM rate in the nation at 6.4%, followed by Nebraska at 7.5% and Minnesota at 7.9%.
National trends show a divergence between these two measures. The official poverty rate fell for a third consecutive year to 10.2%, and child poverty reached a record low of 13.4%. Real median household income also hit a record high of $87,460 in 2025. However, the SPM remained statistically unchanged at 13.1%, sitting nearly three percentage points above the official rate. This gap suggests that while cash income has risen and official poverty has declined, the inclusion of unavoidable expenses and geographic cost variations paints a different picture of financial stability for many households.
The Census Bureau designed the SPM not as a replacement for the official poverty rate, but as an additional lens to capture resources and expenses that the traditional measure misses. Because state samples in the Current Population Survey are smaller than national samples, the Census Bureau recommends using three-year averages for state-level figures rather than single-year estimates to ensure reliability.