California’s Persistent Poverty Crisis: 2024 Rates Remain Alarmingly High

California’s poverty rate, at 17.7%, continued to be the highest (alongside Louisiana) in the United States in 2024, with no tangible improvement from 2023. Racial poverty gaps also remain stark, with Black and Latinx Californians experiencing poverty at approximately ten percentage points higher than white Californians, according to new Census data. California’s poverty rate means that about 7 million state residents lacked the resources to meet basic needs last year — roughly equivalent to the populations of Los Angeles, San Diego, San Jose, and San Francisco combined.

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 —underscoring that poverty is a policy choice. Bold investments in the federal Child Tax Credit (CTC) and other economic security-promoting policies during the pandemic were associated with a historic drop in poverty in 2021. 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.

Recent federal and state cuts to life-saving programs will likely contribute to an even greater rise in poverty and increased economic inequality across California next year and beyond, unless policymakers take bold action to respond. On July 4, 2025, President Trump, with the support of every Republican in California’s congressional delegation, signed a federal budget into law that strips away health care, food assistance, and other basic supports for millions of Americans, driving up living costs and making it harder to make ends meet. This shift in federal policy diverges from established evidence on effective strategies to reduce poverty, which emphasize sustained investments in public supports. The 2025-26 California state budget also includes significant reductions in health care that will harm the same populations targeted by federal policies, particularly immigrants, seniors, and people with disabilities.

Confronting the harm to California’s communities requires bolder action from state leaders. With 7 million Californians already living in poverty 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. These investments are possible if leaders raise significant, ongoing revenue, particularly from the corporations and wealthy individuals that are overwhelmingly benefiting from recent massive federal tax cuts.

Poverty Remains Alarmingly High Following Repeal of Pandemic-Era Policies

Nearly 7 million Californians lived in poverty in 2024, according to new US Census data based on the Supplemental Poverty Measure — a more comprehensive reflection of economic well-being than the Official Poverty Measure. The poverty rates of 17.7% for all Californians and 18.6% for children were statistically unchanged from 2023 levels, but reflect a drastic increase from the recent historic low of 11% overall poverty in 2021.

This alarmingly high level maintains the trend in increased poverty over the last few years since the expiration of many pandemic-era policies that expanded public benefits and their reach. The last of those expansions expired in early 2023 with the end of Supplemental Nutrition Assistance Program (CalFresh in California) emergency allotments, which temporarily increased nutrition benefits for program participants. The post-relief trend underscores the significant role that federal supports like safety net and social insurance programs play in reducing poverty.

Poverty Increased Across All Age Groups, Especially for Younger Californians

Poverty rose significantly across all age groups from 2021, though rates vary among children, adults, and older adults. Notably:

• Child poverty more than doubled, reflecting the sunset of the expanded federal Child Tax Credit. Child poverty has risen since 2021 from 7.5% to more than double that in 2024 at 18.6%. In general, the poverty rate is higher for children than for adults given the costs associated with raising children (such as child care) and the low wages for parents and caregivers, particularly women and women of color. Additionally, at the national level, the expanded federal CTC kept 2.9 million children out of poverty in 2021. When Congress let the expanded CTC expire in 2022, more children in California fell into poverty. This trend will only worsen with recent federal budget decisions to take the child tax credit away from mixed-status families.
• Poverty remains highest for older adults in California. As displayed in the chart above, poverty is highest for adults ages 65 and older, at 21.1%. This trend is largely due to higher out-of-pocket medical expenses for older adults and mirrors national poverty trends. 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.
• Poverty rates for adults are significantly higher in 2024, as compared with 2021. Sustaining a trend from last year, poverty continues to be on the rise for the largest age group in California. Specifically, poverty for Californians ages 18 to 64 rose from 11.1% in 2021 to 16.5% in 2024.

Racial Inequities Persist, Further Highlighting How Federal Actions Disproportionately Impact Californians of Color

Poverty increased across all racial and ethnic groups from 2021 to 2024. These increases were most pronounced for Black and Latinx Californians, further widening racial disparities in the state. Such disparities reflect generations of systemic racism that continue to persist. Racial discrimination in housing, access to banking, education, and taxation have all contributed to a racial wealth gap that is reflected in today’s poverty estimates.

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. 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. More than one in three Californians — nearly 15 million people — rely on Medi-Cal, the state’s Medicaid program, for health coverage. Latinx Californians represent more than half of Medi-Cal enrollees and Black Californians make up nearly 7% of enrollees.

At the same time, 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, with even steeper increases for communities of color.

Federal actions also permanently gut the federal estate tax, allowing wealthy families to pass up to $30 million to their heirs tax-free, perpetuating wealth inequality and the racial wealth gap.

Without strong state policy interventions, recent federal actions will deepen racial and ethnic disparities, leaving Californians of color with fewer resources to stay healthy, build wealth, and achieve economic security. Protecting Medi-Cal and advancing more equitable tax policies are critical to ensuring all Californians can share in the state’s prosperity.

California Renters Experience Higher Levels of Poverty, Particularly Latinx and Black Renters

Housing is the single largest cost in most family budgets, and high housing costs are pushing more people, especially those already facing systemic barriers, into deeper hardship. California renters are particularly likely to experience poverty due to unaffordable housing costs, which threaten their economic and housing stability.

More than one-quarter (27.1%) of California renters experienced poverty in 2024, compared to 11.1% of homeowners. The 2024 poverty rate for renters is not statistically different from the 2023 rate, but it is significantly higher than the rate in 2021 (15.8%), when pandemic assistance for renters was still available.

Renters with the lowest incomes come from different walks of life and include older adults, people with disabilities, families, and single caregivers. Many also work or are pursuing their education while trying to stretch their budgets to make ends meet. Latinx and Black renters experienced the highest rates of poverty in 2024, at 30.9% and 30.5%, respectively. This is consistent with the fact that these groups of renters are most likely to have unaffordable housing costs that account for more than 30% of their income.

Future federal policy choices may lead to increases in poverty among renters. Proposals from the Trump administration and the House for the upcoming federal fiscal year included cuts to rental assistance and affordable housing funds. Meanwhile, the Senate proposed level funding for Housing Choice Vouchers — the main federal rental assistance program — which is still not sufficient to fully fund voucher renewals for current participants, and could result in an estimated 14,400 households, encompassing 31,600 people, losing housing vouchers in California. Additionally, neither the House nor Senate has proposed sufficient funding for fully transitioning Emergency Housing Voucher recipients into the Housing Choice Voucher program, which currently serves over 15,000 people in California.

The lack of federal and state investments in affordable housing and rental assistance, combined with the enacted federal cuts to health and food assistance, will mean more families and individuals will face impossible choices between having enough food, accessing needed medical care, and paying rent.

Tackling Deep Poverty Requires Bolder Expansions

In 2024, nearly 2 million Californians lived in deep poverty. Deep poverty, which is representative of severe economic hardship and extreme poverty, is defined in this analysis as a household with total resources below 50% of the supplemental poverty measure threshold. For a family of two adults and two children, this is equivalent to approximately $20,000 per year, inclusive of public assistance.

Over the past few years, the deep poverty rate has remained relatively stable, even during historic drops in the overall poverty rate in response to expanded pandemic-era relief. The trend in the deep poverty rate among children appears to have been more responsive to increased federal supports in 2021, which coincided with significant expansions to the child tax credit, but rose to pre-pandemic levels after these expansions were repealed.

Research shows that since the 1990s, following sweeping reforms to the safety net, public assistance has shifted from helping the poorest households toward work-based assistance. The emphasis on policies like work reporting requirements to obtain assistance minimizes the complex barriers to work for people facing this level of economic hardship, often categorically excludes people in need from accessing programs, and has contributed to a rise in deep poverty. As a result, investments in traditional public supports often don’t reach the people who experience deep poverty. To truly support Californians living in deep poverty, policymakers must go beyond simply maintaining existing safety net programs and expand them so families currently blocked from accessing supports can afford food, health care, and rent.

Californians Need State Leaders to Address Poverty with Bold Action

Poverty in California remains extremely high, and recent federal budget cuts will cause a steeper rise in hardship in years to come as millions of Californians lose health care and food assistance, further straining household budgets and pushing them deeper into poverty. Faced with this looming crisis, Californians need state leaders to take bold action to mitigate the harm and hardship of federal cuts. State leaders should particularly focus on ensuring that the corporations and wealthy individuals, who were recently showered with massive federal tax cuts, contribute more in state taxes. This is because these federal tax giveaways are largely financed by deep federal cuts to health care and food assistance — the very cuts that are likely to cause poverty and hardship to rise for years to come — and because corporate profits have skyrocketed in recent years while workers’ wages have stagnated. As a start, state leaders should:

• End California’s most costly corporate tax break — the water’s edge loophole — which allows corporations to avoid around $3 billion in California taxes each year and deprives the state of needed resources to address the most pressing concerns facing Californians.
• Prevent profitable corporations from completely wiping out their tax bills by placing reasonable limits on their tax credits and deductions, ensuring they contribute to state services just like all Californians.
• Institute a graduated corporate tax rate to ensure California’s most profitable corporations pay their fair share to support services all Californians need.

Improving the economic security of Californians not only lifts families out of poverty, it also supports a more equitable state and a robust economy. Racial/ethnic and gender disparities in California continue to persist, which will further widen without action from state leaders. For California to be a state for all to thrive — regardless of race or ethnicity, gender, and other identities — state leaders should take bold action to mitigate the rise in poverty and present a different vision for California than the one the federal government has put forth in recent months. State leaders have the tools to hold a California for all as the vision, the goal, and the promise.