Housing affordability crisis escalates for Indiana’s low-income workers

Indiana – Indiana’s low-wage workers are grappling with increasing housing affordability issues, as a widening gap between stagnant wages and the rising cost of housing exacerbates the state’s housing crisis. The National Low Income Housing Coalition (NLIHC) and Prosperity Indiana highlighted these concerns in their report published on June 14, 2023.

The report, titled “Out of Reach”, sheds light on the widening disparity between income and rental costs. It reveals that in 2023, workers across the country need to earn a “Housing Wage” of $28.58 per hour to afford a modest two-bedroom rental property. This figure is significantly above the earning capacity of numerous low-wage workers, placing affordable rental housing out of reach for millions of American families.

In Indiana specifically, the required hourly wage to afford a two-bedroom apartment at fair market rates is $19.00. However, Indiana’s average renter wage persistently falls short of the Midwest average, further complicating the housing affordability predicament.

The Housing Wage required for a two-bedroom apartment in Indiana witnessed a 12% surge from the previous year. In contrast, the average wage for Indiana renters saw a mere 7.5% increase. This growing discrepancy heightens the difficulties faced by low-wage workers in securing affordable housing and disproportionately impacts Black and brown residents, families with children, and vulnerable populations across various communities.

A case in point is Indiana University, one of Bloomington‘s most substantial employers. Although the institution recently announced pay raises of up to 3% for its staff, not all employees will benefit from this increment. Furthermore, housing costs in Bloomington stand 40% higher than the rest of Indiana.

Andrew Bradley, Policy Director for Prosperity Indiana and a board member of NLIHC, urged the development of a comprehensive strategy to tackle Indiana’s affordable housing shortage and low-wage employment. He emphasized that boosting job quality, carving pathways to superior careers, and enhancing affordable housing availability and standards are crucial steps to mitigating this situation.

The report further exposes the increasing number of working hours needed for minimum-wage earners in Indiana to afford housing. To afford a modest one-bedroom or two-bedroom apartment, a minimum-wage earner must work over 86 and 105 hours per week, respectively. These figures outstrip the hours required in several Midwest states and even some major cities, placing enormous pressure on individuals and families.

Laurin Embry, Director of the Indiana Tenant Association and the Indianapolis Tenants Rights Union, spotlighted the dire consequences of this crisis. She narrated an instance of a family losing their children to the Department of Child Services due to homelessness.

Diane Yentel, President and CEO of NLIHC, underscored the report’s revelations, calling for comprehensive federal legislation and adequate funding to address the country’s long-term housing affordability crisis.

For access to the full report, please visit the NLIHC’s website at http://www.nlihc.org/oor. The press release for the report can be accessed at: https://prosperityindiana.org/Policy-News/13215113.