These are the most financially distressed zip codes in the United States (2023)

Although the economy and the job market have grown in thetime after the financial crisis, Americans living in "troubled" -- increasingly rural -- ZIP codes are struggling to find stability.

And its path to progress represents a "catch 22" situation, according to a researcher at the Economic Innovation Group.


"Young people are stuck in debt in troubled communities," EIG research director Kenan Fikri told Yahoo Finance. "And they have no real way out of their situation and can't move to a thriving metropolitan area to try to reverse it. So it's really a problem that individuals who try to advance in these communities end up ending up.

to EIGMessage, originally published in October 2018, analyzed nearly 25,800 ZIP codes -- 99% of the US population -- and compared two time periods: 2007 to 2011 and 2012 to 2016. One of the main reasons struggling communities are being left behind, the researchers found, is it was a lack of educational success.

However, as residents of these troubled communities attempted to fill that gap by attending college, they were saddled with student debt, resulting in a worse financial situation.

These are the most financially distressed zip codes in the United States (1)

Yahoo Finance


Suffering was defined using seven metrics: education level, housing vacancy rate, unemployment rate, poverty rate, median income, change in the number of jobs and businesses.

"It's really worrying. We overlaid the [Distressed Communities Index] map with the map where student debt is most distressing and found that default rates are highest where economic opportunities are worst,” Fikri said.

These are the most financially distressed zip codes in the United States (2)

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Keith Orejel, an assistant professor at Wilmington College who studies rural communities, told Yahoo Finance, "The situation in rural America is much more structural. Ultimately, if you get to the heart of the matter, rural areas never recovered from the Great Recession.”

Orejel added: "If you really look at the data, it's pretty shocking. Urban and metropolitan employment is now well above pre-Great Recession levels, while total employment in areas outside of metropolitan areas is still below pre-Great Recession levels. And there is clearly just a lack of job opportunities in the countryside that makes these places economically unattractive to live in.”


Parts of rural America will 'likely never fully recover'

While 97% of America's landmass is rural, only about 20% of the population lives in these areas, according to theUS census. The data also showed that about 65% ofentire rural populationlive east of the Mississippi and almost half of the rural population lives in the south.

These rural areas "are increasingly vulnerable, and we're finding that overall rural economic well-being is more volatile," Fikri said. “As the recovery has progressed, metropolitan areas have really benefited disproportionately. The Great Recession didn't hit rural ZIP codes as badly as a group, but the recovery didn't hit them either."

The most problematic ZIP codes are concentrated "in the Southeast, the rural West, and the urban centers of the Northeast and Midwest, which have the most persistent areas of truly entrenched poverty in the country," Fikri explained. "And we see that poverty coincides with all sorts of other socio-economic problems: low education levels, low employment rates, low job growth and low number of new business openings."

These are the most financially distressed zip codes in the United States (3)

Spencer Platt via Getty Images

The South in particular has seen a sharp drop in overall ratings.

"In Louisiana, New Mexico and West Virginia, even more of their ZIP codes fell into the problem category between the two periods, and the proportion of their populations with problems increased correspondingly," the report says. "They joined Alabama, Arkansas and Mississippi to bring the number of states to six where about a third or more of residents live in underserved communities."


The problem with many of the trouble spots in these states was that a large number of jobs were predominantly blue-collar, "physically demanding" and poorly paid, according to the report: "3 in 10 working adults in these communities worked in traditional blue-collar jobs such as manufacturing, Construction, transport and maintenance occupations.

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But the big boom that followed the Great Recession era disproportionately affected white-collar areas, with jobs increasing in "affluent" areas, as shown in the chart below:

These are the most financially distressed zip codes in the United States (4)

Yahoo Finance

And the post-recession recovery hasn't just ignored troubled ZIP codes, the report added. They are also predicted to never fully recover from the Great Recession at current trendlines.

Education as a "fault line"

The OIG found that the huge gap between struggling communities and thriving, stable communities boils down to one major flaw: education.


Most major metro areas listed as problematic have the lowest college graduation rates nationwide.

"The population disparity between affluent and disadvantaged communities was explained almost entirely by the concentration of college-educated Americans in affluent ZIP codes," the report said. "Prosperous ZIP codes contained ... 27.7 million adults with a bachelor's degree or higher, nearly six times the 4.8 million who lived in troubled ZIP codes."

In Bakersfield, California, for example, where nearly 50% of the population lives in troubled ZIP codes, residents of the area had “the lowest college graduation rate of their peers, with only 15.7% of the population holding a bachelor’s or bachelor’s degree. half the national rate," the report said.

These are the most financially distressed zip codes in the United States (5)

Lucy Nicholson / Reuters

And while education is seen as a crucial step for those trying to break out of troubled communities, that same college degree drives many others into debt.


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After incurring relatively large student debt because they cannot afford the high tuition fees, borrowers have difficulty repaying the loans after graduation.

At Bakersfield, the average graduate debt was $15,150, according to an analysis by WalletHub, while the average income was $60,862. This means that post-graduation student debt accounted for nearly a quarter of graduate income.

"Youth on the Run"

And because education was an important factor in economic well-being, many rural communities struggled with lagging educational attainment rates.

or 2017USDAThe chart below shows that a significant proportion of people living in the South do not have a high school diploma.

And while some choose to go to college, it wasn't a commercially rewarding experience, as USDA statistics also show. While nearly 48% of urban 18- to 24-year-olds were enrolled in college in 2015, only 29% of their rural peers were, the researchers saidNational Center for Education Statistics.


And those who graduated college saw significantly lower incomes than in urban areas, according to the reportUSDA.

These are the most financially distressed zip codes in the United States (6)

Yahoo Finance

Orejel, the professor of rural communities, addressed another problem facing rural communities: the decline of the manufacturing industry. Manufacturing jobs that were available in rural areas - andjobs createdholding back young people – who served as “the staple of middle-class rural jobs have just been utterly devastated”.

This trend is easy to observe.Yahoo Finance previously reportedthat since 1989 the number of service jobs has increased by 53.4%, but the manufacturing industries have declined by 15.5%.

But the transition to a more modern economy has not been easy. Most big industries like finance and real estate don't find these locations attractive "because rural areas don't have the infrastructure to support a lot of these more sophisticated developments," Orejel explained. "And the population lacks the level of education to fill these positions."


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So the gap is widening, Orejel said: "In the two-tiered economy that has been developing since 2008, where there are many high-tech, professional and high-skilled jobs that drive economic growth, they are increasingly gravitating toward metropolitan areas."

He concluded that “the rural economy is left with the low wages, the bottom end of the service sector – notoriously low wages with little or no social benefits. And then almost total job insecurity.”

Aarthi is a writer for Yahoo Finance. Follow her on Twitter@aartishwami.

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These are the most financially distressed zip codes in the United States (7)

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What are the most economically distressed areas of the US? ›

The 10 most distressed counties can be found in Appalachia and the Deep South. McDowell County, WV, ranks as the most economically distressed county in the country, followed by other small-population counties in chronically struggling parts of Georgia and Louisiana.

What is a distressed zip code? ›

A community is categorized as distressed if its score is above 80, whereas if a zip code scores below 20, it is considered prosperous.

Which region has the highest percentage of zip codes in economic distress? ›

The South is home to more than half (51.2 percent) of the country's population in distressed zip codes, even though the region only contains about 38 percent of the total U.S. population. The South also has the lowest percentage of residents who reside in prosperous and comfortable communities.

What is an economically distressed area? ›

Accordingly, the Commission designates as “distressed areas,” those census tracts in at-risk and transitional counties that have a median family income no greater than 67 percent of the U.S. average and a poverty rate 150 percent of the U.S. average or greater.

What is a distressed neighborhood? ›

noun. a region so severely damaged by a flood, hurricane, or other natural catastrophe that its inhabitants need food, clothing, shelter, and economic aid from national charities or the federal government.

What is the best state to live in economically? ›

The five best states for your personal finances in 2022 are (No. 1 being best): Tennessee. Utah.
  • New Jersey.
  • Hawaii.
  • Connecticut.
  • Alaska.
  • Illinois.
Mar 30, 2022

What is America's poorest ZIP Code? ›

1. Zip code: 15929 │ East Wheatfield, Pennsylvania.
  • Median household income, that is, the point that divides half the people making more and half making less.
  • Mean household income, which is the total of all incomes, divided by the number of people reporting.
Jul 18, 2019

What are distressed counties? ›

Distressed counties are the most economically depressed counties. They rank in the worst 10 percent of the nation's counties. At-Risk. At-Risk counties are those at risk of becoming economically distressed. They rank between the worst 10 percent and 25 percent of the nation's counties.

What are the lowest zip codes? ›

The lowest ZIP Code number is 00501, unique for the Internal Revenue Service in Holtsville, NY.

Which country is the most affected by economic crisis? ›

The Carnegie Endowment for International Peace reports in its International Economics Bulletin that Ukraine, as well as Argentina and Jamaica, are the countries most deeply affected by the crisis.

In what state is the richest zip code? ›

The 10 most expensive ZIP codes in the U.S.
  1. Atherton, California (94027) Median home sale price in 2022: $9,000,000.
  2. Sagaponack, New York (11962) ...
  3. Beverly Hills, California (90210) ...
  4. Boston (02199) ...
  5. Fisher Island, Florida (33109) ...
  6. Water Mill, New York (11976) ...
  7. Montecito, California (93108) ...
  8. Ross, California (94957)
Nov 12, 2022

What is the most diverse zip code in the country? ›

Share this article
RankZip CodeNeighborhood
2.11428Queens Village
3.94130Treasure Island
6 more rows
Nov 13, 2012

What causes economic distress? ›

Economic distress means conditions affecting the fiscal and economic viability of a rural community, including such factors as low per capita income, low per capita taxable values, high unemployment, high under- employment, low weekly earned wages compared to the state average, low housing values compared to the state ...

What is the Distressed Cities Index? ›

The Distressed Communities Index (DCI) is a tool for measuring the comparative economic well-being of U.S. communities and helps illuminate ground-level disparities across the country.

What are the signs of economic crisis? ›

Signs of an Upcoming Economic Depression
  • Worsening unemployment rate. A worsening unemployment rate is usually a common sign of an impending economic depression. ...
  • Rising inflation. ...
  • Declining property sales. ...
  • Increasing credit card debt defaults.
Dec 5, 2022

What makes a distressed property? ›

A distressed property is a home on the brink of foreclosure or already owned by the bank. Investors often seek these properties out because of the opportunity to buy a home at a discount. However, buyers are taking a risk that the property might need significant repairs.

How do you find distressed properties to flip? ›

One of the best ways to locate distressed property is to search online. Top websites that specialize in distressed property listings include,, HomePath by Fannie Mae, HomeSteps by Freddie Mac Homes,, and RealtyTrac.

What is an example of a distress sale? ›

Example of Distressed Sale

For instance, a sale of a business that is consistently making losses and almost on the edge of winding up is an example of a distressed sale. Or let us say another example is selling a run-down house for less than its market price, where the owner is ready to bear the loss in the sale.

What is the 2 cheapest state to live in? ›

Mississippi is the cheapest place to live in the United States, with a cost of living 15.6% lower than the national average.
1. Mississippi.
Unemployment Rate3.9%3.7%4
3 more rows
Feb 2, 2023

Which state has the best life? ›

WalletHub has an answer. Researchers at the personal finance publication ranked the 50 states based on scores in five categories: affordability, economy, education and health, quality of life, and safety. Massachusetts topped 2022's list, touting a score of 62.65 out of 100.

What is the #1 best state to live in? ›

Full Listing
Best States to Live in 2023
2North Dakota
47 more rows
Dec 21, 2022

Which city is poor in USA? ›

Top 50 cities. For next 50 go here.
Poverty RankingCity% of Pop. Living below Poverty
1San Juan41.4
3St. Louis37
50 more rows

Where do the poorest live in America? ›

Poverty rates were highest in the states of Mississippi (19.58%), Louisiana (18.65%), New Mexico (18.55%), West Virginia (17.10%), Kentucky (16.61%), and Arkansas (16.08%), and they were lowest in the states of New Hampshire (7.42%), Maryland (9.02%), Utah (9.13%), Hawaii (9.26%), and Minnesota (9.33%).

Where is the poorest place in the US? ›

Places (2013—2017 American Community Survey)
RankPlaceState or territory
1Little River CDPCalifornia
2Villanueva CDPNew Mexico
3Nottoway Court House CDPVirginia
4Lower Santan Village CDPArizona
86 more rows

Why is a county important? ›

Counties establish important local laws (ordinances) and enforce laws that protect citizens from harmful behavior. They also encourage citizens and businesses to get involved in their communities.

What is a county in geography? ›

A county is a territorial division and a unit of local government in some countries. Counties are usually made up of cities, towns, and rural populations. The functions of a county vary from country to country. In the United States, counties are usually government units below the state level.

What ZIP Code is 99999? ›

It doesn't exist. In fact, the highest real zip code is 99950, for Ketchikan, Alaska. Still, if you scour your database, there's a good chance you'll find more than a few 99999 zip codes. Most organizations find that it's been entered as a placeholder in their shipment database.

What is my ZIP Code extra 4 digits? ›

The four extra numbers are added after a hyphen to complete the ZIP+4. So what do the extra numbers mean? These last 4 digits represent specific delivery routes within delivery areas. This extra detail means an even more precise matching to a more granular level.

Is there a 0 ZIP Code? ›

First digits

The first digit of the ZIP code is used as follows: 0 = Connecticut (CT), Massachusetts (MA), Maine (ME), New Hampshire (NH), New Jersey (NJ), Puerto Rico (PR), Rhode Island (RI), Vermont (VT), Virgin Islands (VI), APO Europe (AE), FPO Europe (AE) 1 = Delaware (DE), New York (NY), Pennsylvania (PA)

Which countries are on the brink of economic collapse list? ›

Sri Lanka, Lebanon, Russia, Suriname and Zambia are already in default, Belarus is on the brink and at least another dozen are in the danger zone as rising borrowing costs, inflation and debt all stoke fears of economic collapse.

Which countries are on the brink of economic collapse? ›

Lebanon, Syria, Iraq, Libya and Yemen are teetering on the brink of humanitarian catastrophe, with skyrocketing poverty and an economic implosion that threatens to throw the region into even deeper turmoil.

Which country has the most stable economy 2022? ›

  • Switzerland. #1 in Economically stable. #1 in Best Countries Overall. ...
  • Germany. #2 in Economically stable. ...
  • Canada. #3 in Economically stable. ...
  • Netherlands. #4 in Economically stable. ...
  • United Kingdom. #5 in Economically stable. ...
  • Australia. #6 in Economically stable. ...
  • Japan. #7 in Economically stable. ...
  • Sweden. #8 in Economically stable.

What is the richest small town in America? ›

Most Affluent Small Cities: 10,000 to 30,000 Residents
1Short HillsNew Jersey
1West University PlaceTexas
46 more rows

What is the richest neighborhood in the US? ›

Loyola, Los Altos, California

Loyola, California, is the richest neighborhood in America. The average household income in Loyola is $326,069, with the median income a little lower at $246,563. The median listing price is $3,899,000. Loyola also borders Los Altos Hills, which is one of the richest towns in America.

What are the 10 wealthiest zip codes in the United States? ›

These are America's 10 most expensive zip codes
RankZip codeLocation
194027Atherton, Calif.
311962Sagaponack, N.Y.
494957Ross, Calif.
6 more rows
Nov 15, 2021

What state has the best diversity? ›

The most diverse state in the United States is Hawaii, where Pacific Islanders and various other ethnicities and races live together. California, the second most diverse state, has the nation's largest Hispanic and Latino population. Nevada, the third most diverse state, has an ethnic and racial diversity of 68.8%.

Where is the most diverse place to live in the world? ›

Located in Southern California, Los Angeles is one of the most multicultural cities in the world, with people from approximately 140 different countries, speaking roughly 86 different languages.

What is the most diverse states to live in? ›

Every state was scored in six categories of diversity: socio-economic, cultural, economic, household, religious and political. The highest score went to liberal California, which was followed closely by conservative Texas. The Golden State ranked first in both socio-economic and cultural diversity.

What is causing a recession 2022? ›

A big reason a recession looks imminent is because of inflation, which is showing few signs of slowing down. Last week's consumer price index (CPI) report revealed year-over-year inflation reaching 9.1%, the highest rate since 1981.

Is a recession coming in 2023? ›

In a recent poll of economists, the World Economic Forum found that nearly two-thirds of the respondents believe there will be a recession in 2023. But here's the good news: Many analysts expect a relatively mild and short recession, or what is sometimes referred to as recession with a small r.

What is causing inflation 2022? ›

Higher energy costs caused the inflation to rise further in 2022, reaching 9.1%, a high not seen since 1981. In July 2022 the Fed increased the interest rate for the third time in the year, yet inflation remained high outpacing the growth in wages and spending.

What is a zip code distress score? ›

A zip code, city, or county is considered distressed if its distress score falls in the highest 20 percent of its peer group. Since distress scores are nor- malized to reflect percentiles, scores over 80.0 are considered distressed. “Most distressed,” when used, refers to the highest 10 percent of distress scores.

What is the meaning of financial distress? ›

Financial distress happens when revenues or income no longer meet or pay for the financial obligations of an individual or organization. Financial distress is often a harbinger of bankruptcy and can cause lasting damage to one's creditworthiness.

What are the 5 economic regions of the United States? ›

The eight U.S. economic regions defined by the Department of Commerce Bureau of Economic Analysis: New England, Mideast, Southeast, Great Lakes, Plains, Rocky Mountains, Southwest, and Far West.

What is the poorest economic state in the United States? ›

Mississippi is the poorest U.S. state, with 18.8% of its residents living in poverty. The state also has the highest child poverty rate, with 27.9% of its under-18 population meeting federal poverty guidelines.

What US state has the lowest economy? ›

In contrast, Vermont had the lowest GDP in the United States, with 36.17 billion U.S. dollars.
StateGDP in billion current U.S. dollars
New York1,853.93
9 more rows
Sep 30, 2022

Where do you live in a recession? ›

The most recession-proof cities
RankCityHousing Score
1Cary, NC94.48
2Frisco, TX91.34
3Santa Clara, CA64.39
4Sunnyvale, CA67.64
21 more rows
Sep 17, 2022

What are the 3 main states of an economy? ›

The three-sector model in economics divides economies into three sectors of activity: extraction of raw materials (primary), manufacturing (secondary), and service industries which exist to facilitate the transport, distribution and sale of goods produced in the secondary sector (tertiary).

What are the 4 main economy? ›

The four main types of economic systems are a pure market economy, a pure command economy, a mixed economy, and a traditional economy.

What are the 4 main economic? ›

Economic systems can be categorized into four main types: traditional economies, command economies, mixed economies, and market economies.

What state has the richest economy? ›

The ten richest states in the US umUnion, measured by GDP, are:
  • California – 3,120,386 million.
  • Texas – 1,772,132 million.
  • New York – 1,705,127 million.
  • Florida – 1,111,614 million.
  • Illinois – 875,671 million.
  • Pennsylvania – 788,500 million.
  • Ohio – 683,460 million.
  • Washington – 632,013 million.
Jan 18, 2023

Which state is not poor? ›

Kerala has the lowest poverty ratio with 0.71%.

Thus, we can say that Kerala in India has the lowest poverty ratio.

Where is the poorest area in the United States? ›

Places (2013—2017 American Community Survey)
RankPlaceState or territory
1Little River CDPCalifornia
2Villanueva CDPNew Mexico
3Nottoway Court House CDPVirginia
4Lower Santan Village CDPArizona
86 more rows


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