Framing
California faces significant challenges with poverty, driven largely by its high cost of living, especially housing. When considering metrics that account for living costs, the state consistently ranks among those with the highest poverty levels in the U.S. Poverty rates have risen further with the expiration of pandemic-era relief policies, which had previously provided crucial support to many low-income households. Despite having one of the largest economies in the world, California also has some of the starkest disparities in income and wealth, with a growing divide between affluent communities and those struggling to meet basic needs.
Policy spotlight
* While many of California's social safety net programs, such as CalWORKs, Medi-Cal, and CalFresh, are based on federal initiatives, the state often expands and tailors them through policies to meet the needs of its large and diverse population. * California stands out with its comprehensive employment services alongside cash assistance through CalWORKs, its expansive Medi-Cal program that includes coverage for undocumented individuals in some cases, and its proactive approach to CalFresh with higher eligibility thresholds and streamlined applications. * The state's unique affordable housing initiatives, like the Homekey project, aim to address the housing crisis, while its subsidized childcare programs provide robust support for working parents. * California's minimum wage is one of the highest in the United States, significantly surpassing the federal minimum wage and exceeding the minimum wage in many other states. * Tax credits play a crucial role in the social safety net system in the U.S. The California Earned Income Tax Credit (CalEITC) is a refundable tax credit designed to provide financial relief to low-income working individuals and families in California.
Justice lens
* The economic disparity is particularly pronounced among communities of color, with poverty rates for Black and Latinx residents at 22.3% and 25%, respectively. * As of early 2024, the U-6 rate for Black individuals was notably higher at 8.2%, compared to 5.8% for Hispanic individuals and 4.8% for White individuals. * Gender-based injustice is also evident in gender pay gaps, which is included in the Equity section of this report.
Source & citation
Content on this page draws from The California Doughnut Snapshot and Report, used under CC-BY 4.0.
Aritza, A. and Kraus-Polk, J. et al. (2025). The California Doughnut Snapshot and Report. Zenodo. https://doi.org/10.5281/zenodo.17540639