Morton Marcus: Graduates leaving Indiana because wages are woefully weak

Students will be graduating from Hoosier high schools and colleges in just a few months. Parents and politicians want them to stay in Indiana. I recommend they leave to see what is available elsewhere and return, after a decade or so, if they choose.

One thing they will find is that wages in Indiana are lower than elsewhere. Local boosters and high government officials will tell them the differential is because it costs more to live elsewhere. I tell them the cost of living is mainly a function of the wages earned and the diversity of opportunity.

How much does a worker sacrifice in income by having a job in Indiana? According to the latest figures from the Bureau of Labor Statistics, in the third quarter of 2023, Hoosier workers made $219 per week less than workers nationwide.

Doesn’t sound like much? It comes to nearly $11,400 per year. Working elsewhere in the nation means earning 20% more than working in Indiana.

Only jobs in what is called natural resources and mining (agriculture primarily) earn more in Indiana than nationally. That’s $120 per week (about $6,200 per year), a 9% premium for the Hoosier job.

For sure, if you have a degree or interest in the information sector, leave. The average weekly wage nationally is twice the wage in Indiana ($2,948 vs. $1,472).

Although we proudly hail our manufacturing sector, you’ll sacrifice almost $460 a week working for a Hoosier firm compared to working elsewhere.

As you might know, Indiana state or local government employment is not as well rewarded as similar jobs in other parts of the country. Every week, a Hoosier working for the state could improve their wage by 26% ($312) employed by a bureaucracy elsewhere. The local government worker would find a similar job across the border would bring a 24% ($231) increase in weekly pay.

The least wage differential between Indiana and the nation is found in education (private) and health. Nationally, the average weekly wage in this sector is $1,204, just $46 (4%) more than the Hoosier worker makes.

Not only will students be looking for jobs as we move into the summer months, but candidates for governor, senator, Congress, the state legislature and other positions of consequence will visit us via TV.

Most will say they have a plan to bring the Next Big Thing to Indiana. But how many will consider paying more to existing Hoosier workers? Will any examine the profits of companies large or small, questioning what is paid to the folks already here?

Morton Marcus is an economist. Reach him at [email protected]. Follow his views and those of John Guy on “Who Gets What?” wherever podcasts are available or at Send comments to [email protected].