‘Hoosiers’ Real Purchasing Power Has Increased More Rapidly’

One important reason why living standards in Indiana have improved relative to in forced-unionism states nationwide since the Hoosier Right to Work law was adopted in early 2012 is the relative reduction in Indianans’ cost of living from 2012 to 2016. In an op-ed published last weekend by the Columbia (Mo.) Tribune (see the link below to read the whole thing), I furnish the details:

Over the course of 2011, Indiana was 20.2 percent less costly to live in than [the 24 states that still lacked Right to Work laws as of the end of 2016]. With differences in purchasing power accounted for, Indiana’s per capita disposable income was roughly $1,360 higher than the average for the big labor-dominated states at that time.

By 2016, the annual average cost of living in Right to Work Indiana was 24.9 percent below the average for the remaining forced-unionism states. And Indiana’s cost of living-adjusted per capita disposable income was more than $3,800 higher than the average for those same states.

Over the past five years, Hoosiers’ real purchasing power has increased more rapidly than that of residents of the remaining forced-unionism states in the Midwest in particular, as well as forced-unionism states nationwide.

Take, for example, Missouri, whose Right to Work law was adopted only this year, and has now, because of a Big Labor-engineered petition drive, been temporarily suspended pending the outcome of a statewide referendum expected to occur in November 2018.

In 2011, Missouri’s cost of living-adjusted disposable income per capita was nearly $500 higher than Indiana’s. But as of last year, the average Hoosier had roughly $2,000 more in real purchasing power than the average Missourian.


For decades, academic research by economists such as Richard J. Cebula (pictured) and Thomas M. Carroll has shown that one side benefit of Right to Work laws is that they can help reduce the cost of living in jurisdictions where they are in effect. Image: Jacksonville University

Right to Work states have a higher standard of living