A new report from the US Bureau of Economic Analysis highlights the recent economic struggles of Hoosiers.
Indiana ranked 39th in the United States in terms of per capita income in 2014. That puts the Hoosier State well below neighboring Illinois, which ranked 16th. Indiana also had lower per capita income than neighboring Ohio (29th) and Michigan (36th) but higher than Kentucky (44th).
The per capita income in Indiana stood at $39,433 in 2014. In comparison, Illinois had per capita income of $48,120, Ohio had $42,571, and Michigan had $40,556.
Per capita income is calculated by taking total personal income from sources such as salaries, dividends and government benefits for every person in the state, and then dividing that number by the state’s population.
The report painted an even bleaker picture for income growth. Indiana had among the lowest income growth of any state at 2.5 percent, much slower than the national income growth rate of 3.9 percent.
Indiana’s income growth rate was mostly boosted by government benefit transfers.
Net earnings growth — which only looks at personal income and does not include dividends or government benefit transfers (including Social Security) — was even lower at 1.6 percent in Indiana compared to 4 percent in the nation as a whole.
While Indiana has a lower cost of living than most states, net earnings growth is slower than the rate of inflation.
The states with the lowest per capita income were mostly in the South and Midwest. New England and Mid-Atlantic states had the highest per capita income in the country.
Mississippi is the state with the lowest per capita income at $34,333. Connecticut had the highest per capita income at $62,467.
The states with the lowest overall income growth were Nebraska, Iowa, Mississippi and South Dakota. The highest income growth was found in the western United States: Alaska, Colorado, Oregon, and Texas. Strong income growth was also found in North Dakota — which has been experiencing an oil boom — as well as tech centers California and Washington state.
Image Credit: Noah Coffey, flickr