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Saturday, January 30, 2016

Ohio Residents Score Low on Financial Stability

What is the bankruptcy rate for residents of Ohio?

A recent report by a Washington D.C.-based firm found that Ohio residents are in the bottom third of the nation when it comes to financial stability. In particular, Ohioans fared poorly in three categories: income poverty, bankruptcy rates and the liquid asset poverty rate (the percentage of households with less than three months savings at the poverty level).

Part of the reason for the low ranking might be the fact that the state has a higher percentage of low-wage jobs than the national average. Moreover, Ohio has a smaller percentage of so-called "micro-enterprises," or businesses with no more than four employees. As far as creating new businesses, the state ranks near the bottom nationally.

What are Ohio's Rankings for Poverty and Bankruptcy?

Ohio ranked at the bottom third of the report in the following areas:

  • Income Poverty Rate. In Ohio, 15.1 percent of households live in poverty, compared to 14.5 percent nationwide. This might be the result of a lack of higher education for Ohio residents that stymies wealth creation.

     

  •  Liquid Asset Poverty. This statistic is related to a family's ability to stay afloat in the event of a financial emergency.  Ohio's liquid asset poverty rate is 44.7 percent, compared to 43.5 percent for the United States.

     

  •  Bankruptcy Rate. Ohio has 3.3 bankruptcies per 1,000 residents compared to the national rate of 2.9 per 1,000. This is partially the result of the foreclosure crisis stemming from the Great Recession of 2008. Homeowners facing foreclosure often will file for bankruptcy to stop a foreclosure proceeding. The foreclosure rate in Ohio is 2.43 percent versus 2.09 percent nationally.

What are the reasons for financial instability in Ohio?

Ohio residents are said to be "asset poor, vulnerable in the housing, and under-banked."

These factors undermine economic growth in the state and this is evidenced by a number of factors including:

  • Low-wage Jobs. In Ohio, 28.4 percent of the jobs were low-wage, that is a job that pays less than $23,624 which is the poverty rate for a family of four.

  • Micro-enterprise Ownership. The number of small businesses with less than 4 employees is 14.4 percent compared to the national average of 16.6 percent.
  • Business Creation Rate. Ohio's business creation rate is 6.6 per 1,000 workers, 48thof 51.

These are grim statistics, indeed, and many Ohio residents are struggling to stay afloat. But there is hope, and filing for bankruptcy may provide relief. If you have questions about personal bankruptcy, you should speak to a qualified attorney.


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