Wednesday, September 21, 2016

By Andrew Bradley

New state-level data from the U.S. Census American Community Survey show improvements in Indiana's poverty rate, household incomes and health insured rates, but some metrics did not match national gains in 2015. While Indiana made progress this year, too many missed policy opportunities have left Indiana falling further behind other states, including dropping two spots relative to other states in both child poverty and median household incomes since 2014.
In 2015, 933,181 Hoosiers lived below the poverty line, or 14.5% of the state's population, a decrease from 15.2% in 2014. This is welcome news for the 41,037 fewer Hoosiers in poverty, and positioned the state at number 26th overall for individuals in poverty, down from 24th. Improvements in poverty rates in 2015 were most dramatic for black (28.4%) and Hispanic (27%) individuals, down from 32% and 28.7% in 2014 respectively, as well as 12.2% in 2015 down from 12.6% in 2014 for white individuals. Indiana's poverty rate is still above its 2007 (pre-recession) rate of 12.3%, suggesting that for the poorest Hoosiers, the state hasn't fully recovered from the recession. This also seems evident from the fact that just over half of 16 to 64-year-olds in poverty worked either full-time or part-time year round.

More than one in three Hoosiers continued to be low-income (including those below the poverty line) in 2015; 2,142,960 Hoosiers lived below 200 percent of the federal poverty line (a basic measure of economic self-sufficiency) in 2015, down from 2,219,443 in 2014. This includes the 1,209,779 Hoosiers between 100 and 200% of the federal poverty line in 2015, often those who are working and making too much to receive aid, but not enough to afford basic needs. When compared to just before the recession in 2007, there are 322,914 more low-income residents in Indiana, and despite recent improvements, the percent of low-income Hoosiers is still above pre-recession levels (29.6% in 2007 to 33.4% in 2015).
Indiana's uneven poverty decrease was most apparent among some of its most vulnerable and disadvantaged populations. More than one in five Hoosier children (20.9%) continue to live in poverty, as Indiana did not see a statistically significant decrease in its child poverty rate of 21.5% in 2014. The U.S. rate dropped significantly from 21.7% in 2014 to 20.7% in 2015and is now just below Indiana's rate. Consequently, Indiana's child poverty ranking rose two spots within the past year compared to other states, from 23rd in child poverty in 2014 to 21st in 2015. Indiana also saw higher child poverty rates among certain racial and ethnic groups in 2015. Comparing Indiana to the U.S. for children age birth to 17, poverty rates are 41.7% (36.4% U.S.) for black children, 36% (30.5% U.S.) for Hispanic or Latino children and 13.9% (12.5% U.S.) for white children.  In addition, Indiana's ranking for the highest rate of elder poverty (age 65 and over) moved from 47 to 41 as the rate increased to 7.2% in 2015 from 7% in 2014. These data suggest that there needs to be more focus on the issues causing poverty among children and the elderly.

Median household incomes increased significantly in Indiana, improving from $49,484 in 2014 to $50,532 in 2015. However, the U.S. increased from $53,713 in 2014 to $55,775, an increase of$2,062. Accordingly, Indiana fell further behind on the state rankings for median household incomes, dropping from 34th in 2014 to 36th in 2015. Indiana's increase of $1,048 was the lowest among all of its neighbors and was second lowest in the Census' 12-state Midwest region, ahead of only Iowa. While these increases in median household income are a promising start, again we have yet to make up ground lost in the recession. The median household income in 2007 was $47,448, and this income had the same buying power as $54,238.81 in 2015 dollars, about $3,750 less than 2015's official median household income.[1]  Racial disparities continue to plague Indiana incomes, with white households making a median $52,659, compared to $31,639 among African-American households and $41,020 among Hispanic or Latino households.

The intersection of race, ethnicity, and gender continued to play an outsized role in Indiana earnings in 2015. Median earnings for full-time, year round male workers in Indiana were $47,092 in 2015, while the median earnings for women was $35,753, or about 76 cents to the male dollar. Black and Hispanic or Latino women earned still less: just $31,922 and $26,870 respectively in median earnings for full time workers. This pay gap may help to explain why 16.2% of Hoosier women live in poverty as compared to 12.9% of men, a poverty gap of 3.3%. While the percentage of both women and men in poverty has gone down, that gap has actually widened since 2014, when it was 3.1%. Policy work will be needed to mitigate these disparities in both poverty and income levels.

Progress on Indiana's educational attainment rates worsened slightly since 2014, with the rate of adults over 25 with less than a high school degree increasing from 11.6% to 11.8%; the rate of high school graduates holding steady at 34.3%; and the rate of those with post-secondary education falling slightly from 54.2% to 53.9%. The state ranked #32 in the percentage of high school graduates (or equivalent) 25 years old or older in 2015, down from #31 in 2014. Twenty-five percent of those who failed to graduate from high school lived in poverty in 2015, compared to 11.9% among high school graduates, 10% of those with some college but no degree, and 3.8% among those with a bachelor's degree. Policies that support quality career pathways that meet Hoosiers where they are on the learning continuum and move them to the next phase are critical, both for Indiana's economic recovery and if the state is to meet its "big goal" for higher educational attainment.

A bright spot for Indiana was the continuing improvement in health insurance rates due to the state adopting Medicaid expansion through the Affordable Care Act and the state's Healthy Indiana 2.0 program. In 2015, 90.4% of Hoosiers had health insurance, a significant increase from 88.1% in 2014 and nearly matching the national rate of 90.6%. Indiana's uninsured rates have also declined significantly to 9.6% in 2015 from 11.9% in 2014. However, the state's rate of uninsured children at 6.7% was still well above the national rate of 4.8% in 2015, and did not decline significantly from 7.2% as the U.S. rate did from 6% in 2014. Generally, though, this is encouraging progress.

The effect of Indiana's policy choices was reflected in data regarding work support programs' impact on low-income families. In 2007 - before the recession - 2.3% of Hoosiers received public cash assistance to help make ends meet when earnings fell short. In spite of the fact that we have not yet fully recovered, Indiana actually has a lower percentage (1.8%) of individuals on cash assistance now. This is in part because the eligibility thresholds for the cash assistance program are a set value and are not indexed to either the poverty level or the Consumer Price Index. Hoosier families utilizing SNAP nutrition assistance were likely to be working families, and often in poverty and/or with disabled family members. In 2015, 77.6% of Hoosier SNAP households had one or more worker, and only 22.3% had no worker in past 12 months. Also, 53.9% were below poverty level, and 47.5% had one or more member with disability, with a median income $18,369. However, Indiana saw a percentage point decline in SNAP participation at more than three times the national rate, despite a smaller decrease in poverty. Indiana SNAP usage dropped from 12.8% in 2014 to 11.5% in 2015, a 1.3 percentage point decline, compared to a national drop of just 0.4 points, from 13.2% in 2014 to 12.8% 2015. Part of this outsized decline might be explained by Indiana's choice to end its so-called "Able Bodied Adults Without Dependents" waiver before many other states did. The resultant decrease in SNAP rolls would show up in Indiana's data before it did in the national average.  

The welcome news of lower poverty and increased income combined with the reality that Indiana's gains trail the national average points to the missed opportunities of Indiana's policymakers to raise incomes, improve job quality, and support effective education and skills training. "Let's take these small gains as a positive step, but Indiana shouldn't be satisfied until policymakers more fully meet the needs of working families," said Senior Policy Analyst Andrew Bradley. "The national recovery is reaching Indiana families at half-strength. Hoosiers must hold policymakers accountable to take action to make up the difference."

 [1] Calculated with the U.S. Bureau of Labor Statistics CPI Inflation Calculator.


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