While 2016 was largely a year of economic gains for Indiana, the state’s gap in pay between men and women actually widened and its poverty rate worsened, according to an analysis of new census data by the Indiana Institute for Working Families.
The institute is a program of the Indiana Community Action Association.
Indiana’s gains are a partial reflection of the national recovery as U.S. incomes finally pulled above their previous high in 1999. The U.S. also saw rare year-on-year improvements in poverty and health insurance coverage from 2015 to 2016. Although Indiana didn’t match those highs, it saw some gains, including a strong single-year rate of increase in median household income and a decrease in child poverty, the report said.
Strikingly, Hoosiers experienced a widening gender and racial pay gap in 2016. Indiana saw a 2 percentage point increase in the gender pay gap among full-time, year-round workers, from 24 percent in 2015 to 26 percent in 2016 - even as the U.S. gap declined. Men saw a $2,065 increase in median earnings while women’s earnings climbed only $687, making the annual wage gap rise to $12,717. Indiana now ranks sixth highest in the nation for its wage gap, up from 12th place in 2015. All of its neighbors perform better than Indiana: Ohio’s gap is at 23 percent, Michigan is at 22 percent and both Illinois and Kentucky are at 20 percent.
Median earnings were up for white and Latino men and women, but down for black and Asian men and women in 2016. Biracial men gained, but biracial women saw a decline.
The overall number of Hoosiers living in poverty decreased to 906,077 or 14.1 percent in 2016, although the drop was within the margin of error. Larger improvements in other states meant that Indiana’s poverty ranking worsened four spots in just one year, from the 26th highest in the U.S. in 2015 to 22nd highest in 2016.
Nationwide, the official poverty rate in 2016 was 12.7 percent.
The portion of Hoosiers considered low income, or below 200 percent of the poverty threshold, was 32.4 percent in 2016. That is still worse than the level of 29.6 percent in 2007, before the Great Recession, the institute’s analysis noted.
Indiana’s median household income gained 2.8 percent from 2015 to 2016, a larger increase than seen in any of its neighboring states. It still is below those neighbors, except for Kentucky, ranking in 36th place nationwide. And adjusted to reflect 2016 dollars, Hoosier incomes are still down $2,616 from 2007.
“In order to see improvements, state policy must address the systemic barriers some groups of Hoosiers experience that are holding them back even as others see gains,” the analysis concluded. “Indiana has a history of solving problems when we give them attention, as has happened with our consistently high ‘business-friendly’ rankings. When Indiana sets its mind on improving the economic status of low-income Hoosiers, it will see success there, too.”