California has highest poverty rate in the nation, tied with Louisiana

OAKLAND, Calif. - New figures show California had the highest poverty rate in the country, tying with Louisiana, and researchers warned that current federal policies threaten to make the situation worse.

U.S. Census figures released this month put California’s Supplemental Poverty Measure at 17.7% in 2024. That represents a comprehensive view of poverty, as it accounts for areas including non-cash benefits, taxes, geographic cost of living differences, and essential expenses like medical costs. 

The non-partisan California Budget & Policy Center said the findings mean about 7 million residents, roughly equivalent to the combined populations of San Jose, San Francisco, Los Angeles, and San Diego, lacked the resources to meet basic needs last year.

The nonprofit research group found that while poverty rose across all age groups and racial backgrounds, some of the state's most vulnerable populations, including children and people of color, saw the biggest spikes.

Poverty a ‘policy choice’

Researchers also said there’s evidence to show that "poverty is a policy choice," as they pointed to the government interventions that were implemented during the COVID-19 pandemic and then later lifted. 

"These figures reflect a troubling trend that began with the rollback of historic anti-poverty investments that were created to mitigate the harm of the COVID-19 pandemic," the center said, adding, "The post-relief trend underscores the significant role that federal supports like safety net and social insurance programs play in reducing poverty."

Those investments, like expanding the federal Child Tax Credit, were made to promote economic stability during an unprecedented time.

"When Congress allowed these effective policies to expire, they immediately reversed progress, causing the largest increase in the national poverty rate in 50 years, and a significant spike in California’s poverty rate," the center said.

Child poverty

Researchers said that once the increased Child Tax Credit, under the American Rescue Plan, ended, child poverty rates more than doubled, from 7.5% in 2021 to 18.6% in 2024.

"When Congress let the expanded CTC expire in 2022, more children in California fell into poverty," the study said. "This trend will only worsen with recent federal budget decisions to take the child tax credit away from mixed-status families," researchers forecasted.

Governor Gavin Newsom’s office said California has taken action by implementing programs to support families and children.

The office listed actions like expanding affordable childcare, creating free universal preschool (TK) for all, free universal school meals, free summer school, and expanded Paid Family Leave to large segments of the workforce.

Racial discrepancies 

Census figures showed Black and Latinx Californians experienced higher poverty rates, about 10% higher than white Californians.

Researchers said the discrepancies among these populations were expected to continue. 

"Recent federal actions will disproportionately harm Californians of color and immigrants and are likely to push more Black and Latinx Californians into poverty in future years," researchers said.

Older adults 

The center said overall, the 2024 figures found poverty remained highest among Californians age 65 and older, with the rate at 21.1%. 

"This trend is largely due to higher out-of-pocket medical expenses for older adults and mirrors national poverty trends," researchers explained, as they warned, legislation surrounding Medicare and health plans threatens the state’s older residents.

"Both the federal and state budgets include harmful policies and cuts to health care programs that will make accessing health care for older adults even more expensive, further pushing older adults into poverty," the center found.

Cuts to healthcare

Researchers pointed to data that show more than one in three Californians, or almost 15 million people, rely on Medi-Cal, the state’s Medicaid program. 

"Federal cuts to Medicaid would take health coverage away from millions of Californians of color, forcing families to delay or forgo care, take on medical debt, and face greater risks of falling into poverty," the center said.

They also noted that monthly premium costs for Covered California, the state’s health insurance marketplace for people who do not qualify for Medi-Cal, are projected to rise by an average of 66% due to the expiration of enhanced premium tax credits.

Governor Newsom’s office said California has taken steps to close the impending gaps in health coverage.

"The Governor has spearheaded the expansion of Medi-Cal to cover all low-income Californians for the first time in the state's history, ensuring more Californians have access to preventive health care regardless of immigration status," Newsom’s office told KTVU in an email.

Healthcare showdown 

Dig deeper:

Health coverage is one of the biggest sticking points on Capitol Hill, threatening a shutdown of the government.

SEE ALSO: Government Shutdown 2025: How Bay Area, U.S. would be affected

Healthcare subsidies put in place in 2021 during the pandemic could expire, sending insurance premiums skyrocketing for millions of Americans. Those subsidies were designed to expand coverage for low-and middle-income residents who purchase health insurance through the Affordable Care Act.

Democrats have demanded the subsidies be immediately extended, as they also called for the reversal of the Medicaid cuts that were enacted as a part of Donald Trump’s "big, beautiful bill" this summer. 

On Tuesday, Newsom’s office warned, without an extension, the average premium costs for enrollees with financial assistance in California could surge by 97%. 

What they're saying:

"Trump is shutting down the government — making monthly health care costs jump hundreds of dollars for millions, putting food assistance for people in need at-risk, and making troops go without pay," the governor said.

Many Republicans are strongly opposed to extending the tax credits, though some are open to it. 

Republicans want Democrats to shelve the debate on tax credits until after a vote on the funding bill. 

Senate Majority Leader John Thune has said Republicans would want new limits on the expanded subsidies, an unlikely compromise that Democrats would agree to.

‘Bolder action’ from California leaders

Researchers called on state leaders to take action and get ahead of the federal policies which they forecast will only increase poverty in the state.

They suggested taking definitive measures like pulling "significant, ongoing" revenue, particularly from entities, like large corporations and wealthy individuals, that are overwhelmingly benefiting from recent federal tax cuts. 

"Confronting the harm to California’s communities requires bolder action from state leaders," researchers said. "Even before these extraordinary budget cuts fully take effect, state leaders should do everything possible to support investments that help Californians afford essential needs, including health care, food, child care, and housing."