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The housing affordability gap for Indiana’s minimum wage workers grew from 2023 to 2024, according to the latest “Out of Reach” report, finding that those Hoosiers would need to work 122 hours per week to afford a two-bedroom apartment at fair market rent.
The new Out of Reach 2024 report finds that Indiana’s 2024 “housing wage” of $22.07 needed to afford a two-bedroom rental unit is an increase of $3.07 per hour above the 2023 housing wage. However, the average Hoosier renter’s wage of $17.92 per hour in 2024 increased by only 6 cents over the past year,” said Aspen Clemons, executive director at Prosperity Indiana. “To address Indiana’s growing housing affordability crisis, state and local policymakers must bridge the growing gap between rents and incomes by using all available policy tools.”
In order to afford that unit, valued at the fair market rent of $1,148, a Hoosier working 40 hours a week would need a housing wage of $22.07—far above the state’s minimum wage of $7.25 and above the average renter’s wage. The findings, from an annual report jointly published by the National Low Income Housing Coalition and Prosperity Indiana, included data on all 50 states and concluded that Indiana had dropped from 43rd to 34th in terms of affordability between 2021 and 2024.
Indiana still falls below the national housing wage, which is $32.11 per hour for a two-bedroom apartment.
The housing wage is calculated by keeping the cost of a fair market rent two-bedroom apartment and utilities at 30% of a household’s income—meaning that a Hoosier household needs to earn $3,826 monthly or $45,913 annually.
Findings from the report
Prospects are slightly better for renters seeking a one-bedroom apartment, which would cost someone $949 monthly. That would require 101 hours of minimum wage work weekly. But renters living in more populated areas have even higher costs—including the Indianapolis-Carmel area and Louisville area, which have a housing wage of $25.94 and $25.02, respectively.
The average Hoosier wage falls short in 88 of 92 counties and in 25 of the state’s 26 metro areas, according to the report. Additionally, many of Indiana’s core job sectors don’t pay wages high enough to cover the fair market rent for a two-bedroom apartment.
“For the first time in recent history, less than a third of Indiana’s top 20 largest occupations pay wages sufficient to meet the state’s housing wage,” said Andrew Bradley, the senior director of policy and strategy at Prosperity Indiana. “Only a quarter of Hoosiers working in the state’s most popular occupations earn enough on average to afford rent. This is not helping Hoosiers get ahead. With the cost of housing increasingly out of reach for Indiana families, we need coordinated efforts by our federal, state, and local policymakers to raise wages and increase the supply of safe, stable, and affordable housing for all Hoosiers.”
Just six of Indiana’s 20 most common occupations paid a full-time wage enough to afford a two-bedroom rental unit, down from 10 occupations in 2023. These poorly paid occupations employ 843,720 Hoosiers, more than a fifth of the state’s workforce, and are frequently held by women or Hoosiers of color.
Such jobs included home health and personal care aides, with a median hourly wage of $14.79—almost $8 less than the full-time housing wage of $22.07.
Ties to homelessness
“With the cost of rent growing further out of reach for those with the lowest incomes, and absent an adequate housing safety net, it is no surprise that homelessness has been on the rise,” the report concluded.
The national January 2023 Point-In-Time count, a method of counting the number of people experiencing homelessness, identified roughly 653,000 people—the highest number ever recorded and a 12% increase from 2022.
A potential solution could be federal intervention and the report explicitly names bills authored by Indiana Sen. Todd Young to expand housing choice vouchers. Young has identified housing affordability as one of his priorities, authoring bills to incentivize investments in distressed neighborhoods nationwide and cutting “burdensome” local regulations.
In particular, advocates highlighted the “Family Stability and Opportunity Vouchers Act” introduced last year to create 250,000 new housing vouchers for low-income families with young children. Another, the “Eviction Crisis Act,” would build upon Indiana’s Emergency Rental Assistance program to create a “permanent stabilization fund for renters facing temporary financial setbacks,” according to the release.
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Americans need to prioritize their spending better. Everyone is entitled, to cigarettes, Starbucks, gas station soda, etc. Make better choices people.
During the pandemic when rent assistance was offered, similar to student loan pause, instead of saving that money or continuing to pay, people spent them money elsewhere. Now they are in a jam.
Get your priorities straight. I make more than $45K, but I still have to prioritize needs over wants.
Housing prices will never be solved with over spending.
Overspending does not really matter when it takes 2.5 weeks paycheck making $15/hr to afford a 2 bedroom 1 bath apartment in a subpar part of the city….
45k is above the average household income in the state of Indiana – so imagine half the households in the state are in a much worse position than you are
The issue isn’t with how people spend their money, the issue is with the cost of housing and the greed of the real estate industry. The cost of rental housing(rents charged) has far outpaced the cost of supplies, insurance, and property taxes in Indianapolis. *(I know this, because my organization owns and operates more than 30 units of rental housing and I have first hand experience at how much costs have increased. And yet we have been able to maintain our rents to be affordable for the average and low-income person/family. ) This is nothing but greed and capitalizing on a for-sale housing market that is completely out of hand. As Frankie stated, it doesn’t matter whether or not you smoke, spend your money on things that someone who has money thinks are luxuries, if it takes working 122 hours a week to be able to afford a roof over your head, you probably aren’t smoking anymore anyway. There aren’t even 122 hours in a typical 5 day work week. So the person who is working that minimum wage or less than $22k an hour job is literally working multiple jobs, more than 5 days a week. I’m grateful for Senator Young and his efforts, but until we get a handle on what property owners are actually charging for rent, this situation is not going to change. The free market is great until greed outpaces need, then we have a problem.
The above observations are pretty much on the money. But, it’s not just Indiana or Indianapolis, it’s everywhere. In many locations it’s worse. It’s a general, constant inflationary spiral that starts with the cost of energy combined with current administration fiscal policy and priorities which aren’t kind to the average American. Not to be ‘political’ but not inconsequently this high inflation and rising costs took off in early 2021 and has only exacerbated. Elections have consequences. We’re paying the price.
Rising cost and inflation is nothing more than greed. Clearly if the cost of everything is higher than ever and many companies are making money as though it’s being printed. There is really no excuse these companies making record profits, can’t give raises to their employees. The tallest trees and skyscrapers have a ceiling where they can’t grow or be built any higher. There is this foolish idea profits can just keep growing exponentially, year after year. There has to be a point when the bubble is going to explode, and the messiness of that will be all over everyone in this country. Who will suffer most? The average American family or person who makes less than 60,000 a year. Car/truck prices are beyond ridiculous. There is no legitimate excuse for vehicles that depreciate like crazy, to cost from forty five to over one hundred thousand dollars. All based on greed. Market adjustments dealers were and in some cases still doing, greed once again. Banks interest rates, again factor in greed as the chickens have come home to roost. The average fully employed person cannot afford to buy a new or used car, forget leasing an apartment or buying a new home.
I would concur that profit distribution should be better handled by businesses.
BUT the taxation is out of control. Government regulation and taxes at local, state and national levels are passed to the consumer. That is a fact.
Let’s start the conversation with how much of your paycheck goes in to government pockets BEFORE you have to buy food, gas, clothing, property taxes etc and are swindled out of MORE of YOUR money!!!
Government programs are OUR MONEY!
Think about your vote, be active in local government.
And have a very happy Independence Day!
Why do we even talk about minimum wage? It’s so low it has no meaning anymore.