Are the poorest states really Right To Work?
Here’s an interesting statistic released by the American Federation of State, County and Municipal Employees (AFSCME) the other day: of the top 10 poorest states, 8 are right-to-work states. I was naturally skeptical, and they didn’t provide any sources for the claim, so what else could I do besides look into it myself?
Something that people often forget when making state-to-state comparisons of income is that the cost of living varies widely by state, but the federal poverty line doesn’t account for this. For example, Texas has a higher poverty rate than California when comparing nominal incomes, but once the cost of living is adjusted for, California has a higher poverty rate than Texas.
The website “Compare 50” has an archive of the cost of living-adjusted poverty rates among all 50 states and Washington, D.C. until 2011. If we rank states by poverty in a given year, a state that’s in the poorest 10 could easily not be in the poorest 10 the next year, so it didn’t seem fair to just compare states for a given year. Instead, I looked at the COL-adjusted poverty rates from 2007-2011 and averaged them together.
Since Indiana, Michigan, and Wisconsin didn’t become RTW until 2012, 2012, and 2015, respectively, they were included as non-RTW in my calculations. The Excel file with my calculations can be found here.
Overall, of the right-to-work states had a COL-adjusted poverty rate of 13.6774, which was 0.7208 percentage points lower than the 14.3982% poverty rate in the non-RTW states. Excluding D.C. (which ranks #1 in poverty and is non-RTW), six of the poorest ten states were non-RTW, which is quite a different picture from what AFSCME portrayed. Of the top ten states with the lowest poverty rates, six were RTW states.