Below is an analysis of student poverty for 2007 for the 50 states and how it interacts with other important education indicators such as funding, demographics, and achievement.

Student poverty varies by region.1

Southern states have the largest percentage of poor children, with 19.5 percent of the student population living in poverty in 2007. The Northeast and the Midwest have fewer low-income students, with between 13 and 14 percent of students living in poverty, while the West ranks in the middle with a 14.3 percent student poverty rate. 2

Arkansas, which ranks 3rd in student poverty, has almost twice as many students living in poverty as similar-sized Iowa, which ranks 39th. Arkansas educates an additional 42,000 poor students each year—approximately 9 percent of the student population in each of these states.

Student poverty rates are distorted by the relative cost of living.

The poverty line is set at the same income level nationwide; however, the cost of living varies widely across and within states. Often higher wages do not compensate for cost of living discrepancies. Thus it is likely that the incidence of student poverty in high-cost settings is much higher than the Census numbers suggest.



For example, California ranks 19th in student poverty, but has an extremely high cost of living. The percentage of California students living in poverty would jump if the poverty line took cost of living into account. Research by the Public Policy Institute of California using 2004 poverty data shows that California’s statewide poverty rate would increase by nearly 3 percent after cost adjustments.3

Student poverty is roughly correlated with student achievement.

In general, students in wealthier states perform better on national achievement tests. There are certainly examples of states that buck this trend; for example, New York ranks 13th in student poverty, yet performs relatively well on the National Assessment of Educational Progress (NAEP) for 4th graders, while Hawaii ranks 49th in terms of poverty, but scores at the bottom on the NAEP. However, poverty remains a good predictor of student outcomes, particularly at the two ends of the wealth spectrum. In the five states with the lowest percentage of poor students, 31.4 percent of 8th graders are proficient in reading and 32.6 percent are proficient in math. Compare this to the five states with the highest percentage of poor students, where only 19.8 percent of 8th graders are proficient in reading and 18.4 percent are proficient in math.

Student poverty is also roughly correlated with statewide per-pupil expenditure.

In general, the larger the percentage of poor students in the state, the less a state spends on education. While per-pupil expenditure is also related to fiscal effort, the amount of taxable wealth in a state (i.e. fiscal capacity) plays a substantial role in per pupil spending. More students in poverty indicates less aggregate family income available for tax contributions, which usually translates into a lower statewide per-pupil expenditure level. The five states with the lowest percentage of poor students spend an average of $9,943 per pupil, while the five states with the highest percentage of poor students spend almost $2,000 less per student—only $7,945.

1. 1. The student poverty rate includes all children ages 5 to 17 living in poverty. The U.S. Census Bureau releases model-based poverty estimates each year for states, counties, and school districts. The data used here are from the 2007 Census poverty estimates. The poverty threshold varies by the size of the family and the number of related children under 18 years. In 2007, the poverty threshold for a four person family with two children was $21,027. For a three person family with two children, the threshold was $16,705.
2. 2. Regions. Northeast: Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Hampshire, New York, Pennsylvania, Rhode Island, Vermont. Midwest: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin. South: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, West Virginia. West: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, New Mexico, Nevada, Oregon, Utah, Washington, Wyoming
3. 3. Deborah Reed, Poverty in California Moving Beyond the Federal Measure, http://www.ppic.org/content/pubs/cacounts/CC_506DRCC.pdf