When it was first developed in 1963, the poverty threshold was set at the cost of a minimal diet defined by the U.S. Department of Agriculture. Then, a family of two adults and two children under age 18 were considered in poverty with an annual income of $3,104 or less. In 2024, that threshold was $31,812.
That’s an average annual increase of 3.9%, which happens to be exactly equal to the rise in the Consumer Price Index (CPI) during that period. This is nowhere near the increase in the median family income of 4.7% annually which would put the poverty threshold at $51,128 in 2024.
In the past decade alone, Indiana has seen a reduction of the number of persons in poverty from 972,000 persons to 822,000, a decline of 150,000 persons. Our poverty rate has fallen from 15% to 12%. While we’ve seen a 5.4% growth in total population, our poverty population has fallen by 15%.
Sounds good, but half (52%) of this fall was due to a decline in the number of children under age 18. In 2014, one in five children (21.5%) was in poverty. That rate fell to 16.4% in 2024. Could that have been a decline particularly among teen births?
Offsetting the decline in our youth population was the 30% rise in those 65 and older and an 81% increase of those in poverty among those in this population. The elderly have gone from 6.5% of our poverty population to 13.9% over the past 10 years.
Poverty in Indiana is primarily a White problem. Of those in poverty, 64% identify as White, while equaling 76% of all Hoosiers. The general image of poverty, however, is driven not by this reality, but by the incidence of poverty in minority populations. Both the Black (or African American) and the Hispanic populations (of any racial color) are each 9% of Indiana’s people, yet they make up 16% and 13% respectively of the people in poverty.
Education is also related to poverty status. Of Hoosiers 25 years and older, 59% have schooling beyond high school. Despite their low poverty rate of 6%, they constitute 37% of those in poverty. For some the problem is a disability which limits their labor market participation. While only 15% of Indiana’s population have a disability, 24% are in poverty.
Of particular concern are 61,000 Hoosiers, 16 to 64 years old, who worked full-time, year-round in 2024 and are nonetheless in poverty. We would expect holding a full-time, year-round job in Indiana would be sufficient to keep workers out of poverty.
Also, in this 16-64 age group, those who worked less than full-time and year-round had a 17% poverty rate (182,000 persons) and others who did not work at all saw a 29% poverty rate (234,000 persons).
There is still much progress to be made. The answers probably lie with programs that attack the causes of poverty rather than those that directly ameliorate the problem.