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New Study Indicates That Indiana Is Getting Poorer

CBPP and EPI analysis of Census Bureau Data
CBPP and EPI analysis of Census Bureau Data

The state of Indiana is getting poorer, according to the latest report by the Center on Budget and Policy Priorities.

A recent study indicates that here in Indiana, the bridge between wealthy and poor has significantly widened over recent years, with 5 percent of Indiana’s richest households earning 12 times more than the bottom 20 percent of the state’s households. Shockingly, the Hoosier middle-class reportedly earns four-times less than the top-earning households in the state.

So, why is this happening? Well, analysts say that it is not supernatural; it has a lot to do with lost jobs and lost wages. “The story in Indiana isn’t really any different than a lot of those Midwestern states, those Rust Belt states,” said Derek Thomas, senior policy analyst at the Indiana Institute for Working Families. “That’s all post-industrial decline.”

Analysts say that over the last decade, Indiana experienced the highest decrease in median household income. And as much as most people would like to blame that phenomenon on the rich getting richer, the same analysts say it is really about Indiana’s poorest families getting poorer.

“The poor are getting poorer over the last economic cycle,” said Elizabeth McNichols, senior fellow at the Center on Budget and Policy Priorities and co-author of the report. “This is even before the recession hit. This affects children in poverty. If they’re not getting any of the growing prosperity in the country, then it’s hard for them to pull themselves up and get into the middle class.”

To combat this sizeable wedge between economic classes, suggestions by the Center on Budget and Policy Priorities have been made to increase the minimum wage as a means to lend a helping hand to lower income families who need extra support with child care, heath care and transportation. They assembly also wants to give more support to the poor by strengthening the unemployment insurance program.

“One of the consequences of this income divide is that often there are pockets within cities where poverty is concentrated, and schools are often not so good there,” McNichols said. “Property values are low, and property taxes are a major funding source for schools. So that means poor children aren’t getting the skills they need for the jobs of the future. And that’s bad for them, but it’s also bad for the country as a whole.”

However, most analysts agree that these proposed ideas will be met by much opposition.

[Courier Press]


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