12 Ways Poverty Affects Society

Millions of people can’t pay for essentials like food, clean water, housing, healthcare and education. According to the World Bank, about 700 million people live in “extreme poverty,” or less than $2.15 a day. Around 50% of the world lives on less than $6.85 a day. At the current rate of progress, the world won’t end extreme poverty by 2030, which is the first Sustainable Development goal. How does poverty affect society? In this article, we’ll discuss 12 of the most significant ways:

#1. Gender inequality

Poverty has a huge effect on gender inequality and vice versa. According to UN Women, 383 million girls and women live on less than $1.90 a day, compared to 368 men and boys. Most of the world’s poorest women live in Sub-Saharan Africa and Central and Southern Asia. Women work the lowest-paying jobs, work longer hours and do more unpaid labor. These factors, along with few resources, limited access to assets, and stereotyping about women’s place in society, keep millions of women trapped in poverty. Women’s poverty also affects societies as a whole. Because of gender inequality, women lose $9 trillion a year, which is money that would go back into the economy.

#2. Racial inequality

People from marginalized races are more likely to experience poverty than their non-marginalized peers. Take the United States as an example. According to 2019 data, Black American and Hispanic children face the highest poverty rates, with Black kids three times more likely to live in poverty as white kids. Using survey data from 10 countries, the World Bank found that Indigenous people were always poorer than other groups. Indigenous communities, who represent just 5% of the global population, make up 15% of the world’s extreme poor. When poverty increases, it affects marginalized people the most, while addressing poverty improves racial equality.

#3. Education

Paying for a good education can be difficult for people experiencing poverty, which then makes it harder for them to escape poverty. A UNESCO study found that most people not in school lived in countries with lower incomes, such as countries in Sub-Saharan Africa, Northern Africa, Central and Southern Asia and Western Asia. Increasing education access would significantly reduce poverty rates around the world. That same study also found that if all adults got two more years of schooling (or completed secondary school), 60 million people would escape poverty. Poverty also affects a child’s readiness for school. According to a study of Canadian families, kids from low-income families scored “significantly lower” on things like vocabulary and communication skills, cooperative play and concentration.

#4. Employment

Poverty limits access to education, skills training, scheduling availability and other factors influencing someone’s employment. With no better choices, people often have to work in the informal sector, which is not government-regulated. According to the International Labour Organization, workers in the informal sector are more likely to experience poverty than their peers in the formal sector. Poverty also makes it harder to find employment after losing a job. Traveling to interviews and learning new skills can be expensive, while gaps in a resume can hurt a person’s reputation. As the Urban Institute puts it, “poverty can reinforce joblessness just like joblessness can increase poverty.”

#5. Physical health

Poverty isn’t the only factor influencing physical health, but it can’t be ignored. According to a literature summary from the U.S. Department of Health and Human Services, people experiencing poverty are at a higher risk for chronic disease, higher mortality and lower life expectancy. The cost of health insurance, medications and healthy foods, as well as poverty’s influence on chronic stress, contribute to these issues. Globally, people experiencing poverty are more likely to die from diseases like tuberculosis and diarrhea, while tropical diseases (like malaria) disproportionately affect people experiencing the deepest poverty. Another study found that poverty increases the risk of diseases like cancer, heart disease and stroke. While poverty doesn’t guarantee a person will experience serious health issues, it significantly increases their risk.

Where does poverty come from? Here’s our article on 10 root causes.

#6. Mental health

The stress of poverty harms a person’s mental health. According to a 2020 study, poverty in childhood and adulthood can lead to social stress, stigma and trauma, which hurts mental health. Researchers looked at Scotland where people living in the poorest areas had higher levels of poor mental health compared to those living in wealthier areas. Poverty affects a person’s access to mental health treatment, as well. While 83% of high-income countries have organizations that represent people with mental health issues, just 46% of low-income countries have these organizations.

#7. Homelessness

According to the National Alliance to End Homelessness, economic instability increases the risk of homelessness, which makes certain populations – like older people, refugees, people with disabilities and people already experiencing poverty – more vulnerable. Poverty and homelessness operate in a feedback loop. When people don’t have high enough incomes to maintain housing, they’re more likely to become homeless, while experiencing homelessness makes it harder to get a job and escape poverty. To address homelessness, governments must also address poverty, or the number of people experiencing homelessness will continue to grow.

When people experience poverty, they depend on the cheapest, lowest-quality items on the market. These never last long, but without the money to buy something better, people get caught in a vicious cycle. Fantasy author Terry Pratchett describes it perfectly: “A man who could afford fifty dollars had a pair of boots that’d still be keeping his feet dry in ten years’ time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.”

#8. Hunger

Poverty is one of the major causes of food insecurity. Without enough money, people can’t afford nutritious foods, clean water, seeds, farming equipment and other resources linked to reducing hunger. Families must constantly make hard decisions about what to buy, what to sacrifice and how to portion food. Malnutrition and poverty are also linked. According to a 2020 study, of the 800 million people who are undernourished, 780 million live in low-to-middle countries. Malnutrition weakens a person’s physical health, which limits their ability to work and make money. This lack of income then makes it hard to buy food.

#9. Water, sanitation and hygiene

Water, sanitation and hygiene (known as WASH) have a close relationship to poverty. Around 2 billion people don’t have access to clean water, while 3.6 billion don’t have adequate sanitation services. Poverty heavily influences disparities within countries; the poorest people lack resources and infrastructure. For example, wealthy households in urban Ethiopia are 4 times more likely to have piped water than poorer households. Without WASH resources, people are at higher risk of disease, malnutrition, poor crop yields and other issues. There’s a gender equality element, too. Women and girls spend around 200 million hours every day collecting water instead of going to school or working.

#10. Children’s well-being

Poverty has a disproportionate effect on children. According to data from 2022, 333 million kids live in extreme poverty, which is living on less than $2.15 a day. While making up only 31% of the total global population, 50% of the world’s global poor are kids. The effects are devastating. Kids from low-income households face higher risks of cognitive, emotional and health issues, including poor academic outcomes, developmental delays and behavioral challenges. Poverty also increases a child’s risk of death. In 2022, 1 in 14 kids in Sub-Saharan Africa died before age 5, which means kids are 15 times more likely to die than kids born in high-income countries.

#11. Incarceration and crime

Poverty doesn’t directly cause crime, but they’re associated, especially when it comes to incarceration. According to Brookings, an American think tank, boys from families who earned less than $14,000 a year were 20 times more likely than boys from families earning more than $143,000 to be imprisoned while in their early 30s. This disproportionate incarceration is a global issue, according to the UNODC. There are a few reasons for the link between poverty and incarceration, but the inability to pay fines for non-violent crimes (like drug offenses) keeps millions entangled with the criminal justice system. Living in poverty also increases the odds of experiencing violent crime. According to a US study covering 2008-2012, people who lived at or below the Federal Poverty Level experienced more than double the rate of violent crime compared to high-income households.

#12. Future generations

Poverty impacts families through multiple generations. How? It’s hard for people experiencing poverty to escape poverty. This is known as “the poverty trap,” which forms when people need money to increase their wealth. One example is the cost of education. Education helps people improve their economic potential, but when good schools cost too much, they exclude everyone who isn’t already financially comfortable. Banking is also out of reach for many people in poverty thanks to minimum balance requirements, high fees and no service in rural areas. When people can’t access resources that lift them out of poverty, multiple generations of a family are more likely to experience “intergenerational poverty,” which affects millions of people around the world.

Here are 25 organizations fighting poverty.