INDIANAPOLIS — While the State of Indiana is enjoying a surplus of funds, many of the state’s working families are having a tougher time making ends meet, according to a new report issued by an anti-poverty advocacy organization.
The report, issued earlier this month by the Indiana Institute for Working Families, found that only five other states in the U.S. have seen a larger percentage increase than Indiana in the number of people who are officially “low income” since the recession began in 2007.
About one out of every three Hoosiers are now in that “low income” category, which translates into $22,980 for an individual or $47,100 for a family of four. The report also found the poverty rate increased in Indiana from 2010 to 2011 — the latest data available — meaning about one in six Hoosiers are living on less than $11,000 a year.
While some parts of the state have seen a recovery from the recession, statewide there’s still plenty of pain: According to the report, poverty rates have increased for Hoosier children, with almost 46 percent of Hoosier children now living in low-income families.
The report notes that Indiana’s unemployment rate has remained above the national average for much of the last year, topping off a decade that saw declining earning power: The state’s median family income dropped to $57,148 in 2011 from $78,599 in 2000 — the second largest decrease in the nation, according to report authors.
“What we know generally is that Indiana families are falling behind,” said Derek Thomas, a policy analyst with the institute.
Thomas said the last 10 years have been the “lost decade” for many Indiana families. “Especially the people who are just hanging on, who’ve been trying to get into the middle class, they’ve really fallen down,” said Thomas.
In May, the Indiana Chamber of Commerce released a report that contained some similar numbers. It found, for example, that Indiana had the 12th lowest poverty rate in the nation in 2000, but that it dropped to the 34th lowest poverty rate by 2011.
The report released by the Institute for Working Families this month found some grim indicators that show how tough it is for families to recover from the recession’s economic hit. For example, about 70 percent of new jobs in 2011 — many in the service industry — paid full-time wages that aren’t enough to pull a worker out the low-income category.
The report’s release came the same week that state officials announced a rosy fiscal picture for state government. Indiana Auditor Tim Berry and Gov. Mike Pence announced Thursday that the state ended its fiscal year on June 30 with a structural surplus of $483 million ― $93 million more than had been projected in the budget the legislature passed in April. The state also now has reserves of $1.94 billion.
“The balance sheet of Indiana is strong and growing stronger,” said Pence said, who predicted the state’s sound fiscal status will lead to more prosperity by attracting job-creating businesses that see the surplus as a selling point for state.
But critics, including Democrat legislative leaders, said the state’s surplus comes at a time when the state is hurting in other areas.
House Minority Leader Scott Pelath of Michigan City, said in a statement that “the leaders of our state worship these surplus numbers like they are ends in and of themselves…Families still are struggling to keep their heads above water.”
One area where both Pelath and Pence agree is the need to close the skills gap in Indiana, and the Institute for Working Families’ report weighs in on that issue, too. The report found a majority (54 percent) of all jobs in Indiana are still “middle-skill” jobs — often requiring less than a four-year college degree but more than a high-school degree – but only 47 percent of Hoosier workers have the appropriate skills and credentials to fill those middle-skill jobs.