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Incomes and Poverty Higher in Urban Areas

Ale Bishaw and Kirby G. Posey

Households in rural areas have lower incomes than those in urban areas but they are less likely to live in poverty than their urban counterparts.

According to the 2015 American Community Survey, median household income for rural households was $52,386, about 4 percent lower than the median for urban households.

But the percentage of people living below the official poverty threshold was 13.3 percent, almost three points lower than the 16 percent in urban areas. Also, income inequality, as measured by the Gini index, was lower for rural households than urban households. The Gini Index measures income inequality. The index varies from 0 to 1, with a 0 indicating perfect equality, where there is a proportional distribution of income. A Gini index of 1 indicates perfect inequality, where one household has all the income.

The story is more complex for specific demographic groups, regions and states.

Median incomes in rural areas of the Northeast and Midwest ($62,291 and $55,704 respectively) were higher than in the regions’ urban areas ($60,655 and $51,266).. On the other hand, median incomes for urban households in the South and West ($50,989 and $58,541) were higher than in rural areas ($46,891 and $56,061).

But across all four regions, poverty rates were consistently lower for rural residents. The largest difference were in the Midwest and Northeast.

Among all states, only seven states had higher poverty rates in rural areas. In one state, North Dakota, poverty were the same and in 42, urban households had higher poverty rates.

Median household income was higher for rural households in 32 states. In Rhode Island, for example, median rural household income was $85,278, about 57 percent higher than the median for urban households ($54,324). In 14 states, the opposite was true. In Minnesota, Delaware, Florida and West Virginia, incomes were the same in and out of rural areas.

Ale Bishaw and Kirby G. Posey are survey statisticians in the Census Bureau's Poverty Statistics Branch.

 

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