12 States Struggling With Mental Illness

Close to 10 million Americans suffer from chronic depression, bipolar disorder, or another serious mental illness. Depression alone is the leading cause of disability worldwide. In the United States, mental illness — including depression — takes an enormous toll on health outcomes, quality of life, and economic productivity.

Despite its importance, mental illness is often poorly understood and subject to misperceptions by the general population, government officials, and even those who suffer from mental illness. Partially as a consequence, just under one-third of individuals with serious mental illness — defined as diagnosable mental, behavioral, or emotional disorders that result in functional impairment — go untreated in the United States. In 2014, an estimated 44.7% of the 43.6 million adults with any mental illness, and 68.5% of the 9.8 million adults with serious mental illness received mental health services in the past year.

24/7 Wall St. reviewed the 12 states where the highest shares of the adult population suffers from serious mental illness.

Click here to see the 12 states struggling with mental illness.

Depression and mental disorders are treatable psychiatric illnesses. Therapy, as well as a huge amount of prescription drugs such as anti-depressants, anti-psychotics and mood stabilizers are used to treat serious mental illnesses. Because of this, states with a high share of adults with serious mental illness also tend to have more drugs prescribed per capita. The number of these and other kinds of retail drugs prescribed exceeded the national average of 12.7 prescriptions per capita in all but four of these 12 states. In West Virginia and Kentucky, more than 20 drugs are prescribed per person each year.

While the 12 states struggling the most with mental illness do not necessarily have the nation’s highest poverty rates, mental illness is far more common among people living in poverty. Of adults living in poverty, 8.7% report serious psychological distress, in contrast with 1.2% of adults with incomes at least four times higher than the poverty level — around $50,000 — according to the CDC.

A number of socioeconomic factors are associated with mental illness, either as contributors or outcomes. People with mental illnesses are more likely than others to abuse alcohol or illicit drugs. Residents of states struggling the most with mental illness are not necessarily among the most likely to abuse drugs and alcohol. However, in the majority of states with the highest prevalence of serious mental illness, higher shares of adults report needing, but not receiving, treatment for drug use than the 2.2% national average.

States assign different levels of importance to mental illness. Budget allocation for mental health issues varies considerably between states. Only 12 states have increased their respective mental health authority’s budget in each of the past three years. Idaho is the only state with a disproportionately high share of mentally ill residents to have increased its mental health budget annually over this period. Meanwhile North Carolina, which is also home to one of the highest shares of mentally ill adults, is one of just three states to have reduced its mental health budget every year since 2013.

Several states with a relatively high share of adults with mental illness are implementing progressive policies to better address societal issues associated with mental illness. Indiana, for instance, implemented a policy last year requiring state police academies to provide a crisis intervention overview to all police trainees for emergency instances involving the mentally ill.

To determine the 12 states struggling the most with mental illness, 24/7 Wall St. reviewed the share of the adult population with a serious mental illness in each state based on surveys conducted between 2013 and 2014 from the Substance Abuse and Mental Health Services Administration (SAMHSA). Serious mental illness is defined as “having, at any time during the past year, a diagnosable mental, behavioral, or emotional disorder that causes serious functional impairment that substantially interferes with or limits one or more major life activities.” The prevalence of any mental illness, which serious mental disorders that may not have impaired life activities for example, also came from SAMHSA. The percentage of adults reporting at least one major depressive episode in the past year, the share of adults who had suicidal thoughts in the past year, and alcohol and illicit drug abuse rates also came from SAMHSA. Per capita drug prescription rates came from the Kaiser Family Foundation. State mental health legislation and spending was compiled by the National Alliance on Mental Illness. We also considered poverty rates, uninsured rates, and educational attainment rates from the Census Bureau’s American Community Survey (ACS) as well as 2015 annual unemployment rates from the Bureau of Labor Statistics.

These are the 12 states struggling the most with mental illness, according to 24/7 Wall St.

• AP IMAGES FOR AMERICAN EXPRESS
> Pct. of adults with serious mental illness: 4.7%
> Total adults with serious mental illness: 361,000 (8th highest)
> Pct. of adults abusing alcohol or illicit drugs: 8.7% (20th lowest)
> Poverty rate: 17.6% (13th highest)

Of North Carolina adults, an estimated 4.7% have a diagnosable mental, behavioral, or emotional disorder — that is, serious mental illnesses such as schizophrenia, bipolar disorder, post-traumatic stress, and eating disorders. This is the 12th highest share of all states. Mental illness is associated in particular with thoughts of suicide. In North Carolina, 4.3% of adults reported having thoughts of suicide in the past year, the eighth highest percentage in the nation.

Like only two other states, North Carolina has cut mental health spending in the last three years. Last year, despite the governor’s proposed 4% mental health spending increase, the legislature cut the budget by $84 million, or 14%.

Read more on 24/7 Wall St.
• Raymond Boyd via Getty Images
> Pct. of adults with serious mental illness: 4.7%
> Total adults with serious mental illness: 237,000 (13th highest)
> Pct. of adults abusing alcohol or illicit drugs: 9.3% (17th highest)
> Poverty rate: 15.5% (24th highest)

In Indiana, 7.6% of adults reported having at least one major depressive episode last year, one of the largest shares in the country. Chronic and persistent depression that interferes with day-to-day functioning is one of several serious mental illnesses that an estimated 4.7% of adults in Indiana struggles with.

In light of the relative prevalence of mental illness in the state, Indiana increased its mental health authority’s budget in 2015. The same year, Senate Bill 380 directed the Indiana Criminal Justice Institute to create a central resource for training, funding, and other technical assistance for crisis intervention teams across the state. The bill also requires state police academies to provide mental health crisis intervention overviews to all police trainees.

Read more on 24/7 Wall St.
• George Frey via Getty Images
> Pct. of adults with serious mental illness: 4.8%
> Total adults with serious mental illness: 97,000 (19th lowest)
> Pct. of adults abusing alcohol or illicit drugs: 7.8% (3rd lowest)
> Poverty rate: 12.8% (15th lowest)

Slightly more than one in every five adults in Utah are living with some form of mental illness, which includes serious mental illness as well as a range of other less severe disorders, a larger share than in all but four other states. The share of adults living with serious mental illness such as bipolar disorder, schizophrenia, or chronic depression, at 4.8% is considerably higher than the 4.0% of American adults with such an illness.

Unlike some states, Utah is taking active measures to treat mental health issues. Last year, the state was applauded by NAMI for passing House Bill 209, requiring certain behavioral health specialists to complete additional suicide prevention training to renew their license to practice. Of Utah adults, an estimated 4.8% reported having thoughts of suicide in the past year, the highest percentage in the country.

Read more on 24/7 Wall St.
• Tim Graham via Getty Images
> Pct. of adults with serious mental illness: 4.8%
> Total adults with serious mental illness: 109,000 (21st lowest)
> Pct. of adults abusing alcohol or illicit drugs: 8.3% (10th lowest)
> Poverty rate: 22.6% (the highest)

Psychological distress is far more common among people living in poverty than it is among more financially well-off individuals. Financial distress may partially explain the relatively high prevalence of serious mental illness in Mississippi, where 22.6% of people live in poverty, the highest poverty rate in the nation. Furthermore, 4.8% of adults in Mississippi are estimated to have a serious, diagnosable mental illness, among the highest percentages nationwide.

In addition to therapy, anti-psychotics, anti-depressants, and mood stabilizers are frequently used to treat serious mental illness. In Mississippi, 17.7 of these and other kinds of medications are prescribed per resident in a single year, the fourth highest prescriptions per capita in the country.

Read more on 24/7 Wall St.
• Bloomberg via Getty Images
> Pct. of adults with serious mental illness: 4.8%
> Total adults with serious mental illness: 434,000 (5th highest)
> Pct. of adults abusing alcohol or illicit drugs: 9.3% (18th highest)
> Poverty rate: 15.9% (19th highest) Substance use is more common among those suffering from mental distress.

Substances such as tobacco, alcohol and other drugs are frequently used as self-medication. In Ohio, 9.3% of adults abuse or are dependent on alcohol or illicit drugs, higher than the 8.8% national substance abuse rate. Adults in the state are also more likely than most American adults to suffer from short-term episodes of major depression. Of Ohio adults, 7.2% reported suffering from at least one major depressive episode within the past year, the ninth highest share of any state. Along with substance abuse and depression, adults in the state are also more likely to suffer from serious mental illness than most Americans. In Ohio, 4.8% of adults are living with a serious mental illness, one of the largest such shares in the country.

With relative prevalence of mental illness, Ohio residents are some of the most medicated in the country. Each year, roughly 17.5 prescriptions are filled for every state resident, considerably more than the 12.7 prescriptions filled for every American annually.

Read more on 24/7 Wall St.
• Education Images via Getty Images
> Pct. of adults with serious mental illness: 4.9%
> Total adults with serious mental illness: 59,000 (12th lowest)
> Pct. of adults abusing alcohol or illicit drugs: 9.1% (23rd highest)
> Poverty rate: 15.6% (20th highest)

In Idaho, 20.3% of adults have some sort of mental disorder, including serious mental illnesses as well as less severe mental disorders, one of the largest shares in the country and considerably more than the 17.8% share of American adults suffering from a mental illness. Of the state’s mentally ill residents, roughly 59,000 suffer from a serious mental illness — schizophrenia, severe depression, and other disorder that can cause severe functional impairment.

Perhaps because mental illness is more common in Idaho than in much of the rest of the country, the state is investing more in treatment programs. While many states are reducing funding for mental health services, Idaho’s Mental Health Services department’s budget has increased in each of the last three years, one of only 12 states to do so.

Read more on 24/7 Wall St.
• Bloomberg via Getty Images
> Pct. of adults with serious mental illness: 4.9%
> Total adults with serious mental illness: 230,000 (16th highest)
> Pct. of adults abusing alcohol or illicit drugs: 8.5% (18th lowest)
> Poverty rate: 15.6% (20th highest)

Nearly one in every 20 adults in Missouri report serious mental illness, which include a range of psychiatric ailments from schizophrenia to eating disorders. Mental illness in the United States has been largely misunderstood, underfunded, and undertreated — even for those with health insurance. Some states have taken notable steps to address the issue. Missouri’s legislature last year enacted Senate Bill 145, an act mandating health care providers to cover eating disorders.

Like most states struggling the most with serious mental illness, Missourians are more likely than adults nationwide to report at least one depressive episode or thoughts of suicide within the past year.

Read more on 24/7 Wall St.
• Bloomberg via Getty Images
> Pct. of adults with serious mental illness: 4.9%
> Total adults with serious mental illness: 168,000 (21st highest)
> Pct. of adults abusing alcohol or illicit drugs: 7.9% (5th lowest)
> Poverty rate: 18.9% (5th highest)

Kentucky is home to a relatively high share of adults with a serious mental illness. Roughly 168,000 Kentucky adults have a diagnosable serious mental illness, 4.9% of the state’s adult population. By contrast, only 4.0% of American adults grapple with a serious mental illness. Since anti-depressants, anti-psychotics, and mood stabilizers are frequently used to treat mental illness, the relative prevalence of mental illness in Kentucky may explain the high level of drug prescriptions in the state. Each year, there are 22 of these and other kinds of prescriptions filled per state resident in a single year, the highest drug prescription rate in the country. Despite the relative prevalence of serious mental health issues, Kentucky has cut funding for its mental health department in each of the last two years.

Read more on 24/7 Wall St.
• DANNY JOHNSTON/AP
> Pct. of adults with serious mental illness: 5.1%
> Total adults with serious mental illness: 115,000 (22nd lowest)
> Pct. of adults abusing alcohol or illicit drugs: 7.7% (2nd lowest)
> Poverty rate: 19.2% (4th highest)

In Arkansas, 7.1% of adults reported having a major depressive episode within the past year, and 4.5% reported having thoughts of suicide, each among the highest shares of any state in the country. Some of those reporting such incidents likely partially comprise the 5.1% of adults in the state with a serious mental illness such as bipolar disorder or schizophrenia. Like other states with high relative prevalence of mental illness, Arkansas is home to one of the most medicated populations in the country. There are 15.8 prescriptions filled per state resident annually, considerably more than the 12.7 per capita prescription drug rate nationally.

Read more on 24/7 Wall St.
• Beth J. Harpaz/AP
> Pct. of adults with serious mental illness: 5.2%
> Total adults with serious mental illness: 56,000 (11th lowest)
> Pct. of adults abusing alcohol or illicit drugs: 8.2% (8th lowest)
> Poverty rate: 13.9% (22nd lowest)

Maine is one of only four states where an estimated more than one in every 20 adults suffer from serious mental illness. Accounting for less serious forms of psychiatric illness, more than one in every five adults report some form of mental illness, the seventh largest proportion in the country. Roughly 87,000 Maine adults reported at least one major depressive episode within the past year, or 8.1% of the population, the highest percentage of all states.

Residents of rural areas not only need to travel further to health facilities, but also they may be more vulnerable to social isolation — a major driver and component of a number of mental illnesses. High proportions of Mainers live in very rural areas, which may help partially explain the state’s high prevalence of serious mental illness.

Read more on 24/7 Wall St.
• Education Images via Getty Images
> Pct. of adults with serious mental illness: 5.3%
> Total adults with serious mental illness: 27,000 (5th lowest)
> Pct. of adults abusing alcohol or illicit drugs: 10.1% (5th highest)
> Poverty rate: 12.0% (13th lowest) Approximately 27,000

Vermonters are beset with serious mental illnesses, comprising 5.3% of the state’s adult population, the second highest percentage of all states. Mental illness in the United States has been largely misunderstood, underfunded, and under-treated — even for those with health insurance. In Vermont, however, the legislature last year enacted Senate Bill 139, a law intended to improve access to and quality of mental health services. Health insurance coverage in the state, which at about 93% is nearly the highest in the nation, may in the future be more valuable to the mentally ill. The state also enacted a law in 2015 prohibiting some state residents from possessing firearms due to mental illness.

People with mental health disorders are more likely to abuse alcohol or other substances than individuals without serious mental illnesses. Of adults in Vermont, 10.1% report abusing or dependence on alcohol or illicit drugs, the fifth highest share nationwide.

Read more on 24/7 Wall St.
• The Washington Post via Getty Images
> Pct. of adults with serious mental illness: 5.4%
> Total adults with serious mental illness: 79,000 (15th lowest)
> Pct. of adults abusing alcohol or illicit drugs: 9.2% (19th highest)
> Poverty rate: 18.1 (10th highest)

Serious mental illness is treated with therapy, as well as with drugs such as anti-psychotics, anti-depressants, and mood stabilizers. In West Virginia, 21.8 medications are prescribed per resident in a single year, the second highest per capita prescriptions in the country and significantly higher than the national level of 12.7 prescriptions per capita. The 9.2% share of West Virginia adults dependent on illicit drugs or reporting alcohol abuse within the past year, while slightly higher than the national prevalence, is not especially high. However, 2.6% of adults in the state report needing but not receiving treatment for illicit drug use, the fourth highest such percentage nationwide.

According to the CDC, psychological distress is far more common among people living in poverty than it is among financially stable individuals. The typical West Virginia household earns $41,576 annually, nearly the lowest median household income in the nation. The poverty rate of 18.1% is also among the highest in the country. Such conditions may have contributed to the high prevalence of serious mental illness in the state.

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Apparently No One Hates Their Job Anymore

American workers are feeling a lot better about their jobs.

Propelled by a stabilizing economy, employee satisfaction is at its highest level in more than a decade, according to a new survey from the Society for Human Resource Management, an association of HR professionals.

Eighty-eight percent of the employees polled reported being satisfied overall with their jobs in 2015. Of them, 37 percent described themselves as “very satisfied,” and 51 percent said they were “somewhat satisfied.” Compare that to results from the organization's 2005 survey, which found just 77 percent of people were pleased with their jobs. 

As you can see in the chart below, satisfaction took a hit between 2009 and 2013, the years following the recession. By now, though, people are feeling more confident about the job market, and workers who were unhappy and switched jobs five or six years ago have likely settled into their new roles, contributing to the higher satisfaction level, the SHRM researchers say.

SHRM

Age apparently has little to do with how much people enjoy their work. Millennials' satisfaction ranks about as high as that of older generations.

“Stop the stereotypes," SHRM researcher Christina Lee wrote in a paper released alongside the survey. "Although Millennials may have slightly different mindsets, on the whole, they tend to place significance on several of the same aspects of job satisfaction that Generation Xers and Baby Boomers do.” 

Compensation remains highly important in how employees feel about their jobs, with 63 percent of those surveyed citing it as a contributor.

Paychecks, meanwhile, just aren’t growing fast enough. A report last year from the Economic Policy Institute found that growth in worker productivity is outstripping wage growth. From 2000 to 2014, productivity increased by 21.6 percent, while median compensation in the U.S. rose by only 1.8 percent.

Yet compensation ranked only as the second-highest factor contributing to job satisfaction, per the new survey. Topping the list was “respectful treatment of all employees at all levels,” which 67 percent of respondents cited.

“The day-to-day experience is what governs their perspective on their work,” Evren Esen, director of survey programs at the Society for Human Resource Management, told The Huffington Post. “That’s where corporate culture comes into play. You want your supervisor to ask for your ideas.”

Workplaces that promote openness, community and equality are increasingly becoming the norm. While these are aspects valued by all employees, millennials in particular have helped to push that shift forward by being direct about what they expect from their employers.

“They see themselves as equal with who they work with in terms of expressing ideas,” Esen said of millennials. “In that way, by sharing their beliefs with the higher-ups, they are heard more than other generations.”

The expectation that employees are treated equally and fairly, in addition to things like having trustful leaders and transparent management, will only grow as millennials take over the workforce.

Take parental leave: Having a family and young children is hardly a new development, but millennial workers have been more vocal than their older counterparts about having decent company support when they have a newborn. Paid time off is gaining traction quickly, and more and more companies are now offering paid time off to new moms and dads. 

“It’s just what they think is normal,” Esen added. “Millennials say, ‘It’s not that way? Why isn’t it that way?’”

When Domestic Violence Becomes A Workplace Issue

The two deaths came in quick succession, shocking the close-knit community of health care workers at the University of Maryland St. Joseph Medical Center.

First, in August 2013, an administrative assistant was fatally shot by her estranged husband while she was helping her 3-year-old son get into a car. Five months later, a nurse who worked with oncology patients was stabbed to death by her son after a history of domestic altercations.

"She was very optimistic and positive," said Michele McKee, director of nursing services. "The staff is still struggling with the loss. There was denial. Tears. Anger. And then, guilt. What did we miss? What could we have done?"

While hospital staff had been trained to identify patients who were experiencing domestic violence, they didn't pay the same attention to warning signs in their own peers, said Leslie Hott, St. Joseph's human resources manager.

"Our value statement says, 'loving service, compassionate care,'" Hott said. "We typically think about that for those we care for, but not each other."

That is now changing.

St. Joseph is undergoing an ambitious effort to address domestic violence among its workforce, rolling out an intensive training program to help staff members identify -- and hopefully prevent -- domestic violence, as well as a new workplace policy to support employees who are suffering. 

The hospital partnered with Futures Without Violence, a nonprofit that has helped organizations across the country address how domestic violence hurts its workforce. In 2014, Futures began a pilot site project called Low Wage, High Risk to develop best practices for workplaces where employees may be vulnerable to physical and sexual violence. The nonprofit is currently collaborating with tomato crop workers in Florida and restaurant employees in New York, as well as health care workers at St. Joseph in Towson.

The hospital didn’t have a formal workplace domestic violence policy in place when its staffers were killed. Most organizations across the country don’t, even though domestic violence affects 1 in 4 women in the U.S.

There was denial. Tears. Anger. And then, guilt. What did we miss? What could we have done?Michele McKee, director of nursing services

In addition to creating serious safety issues in the workplace, the Centers for Disease Control and Prevention estimates that domestic violence costs the U.S. at least $8 billion a year in lost productivity and health care costs.

The federal government is trying to set a good example. President Barack Obama issued a memorandum in 2012 that requires all federal agencies to develop policies to support employees whose working lives are affected by domestic violence.

It is often thought to be something that occurs in private, but the pervasive effects of domestic violence can spill over into victims’ work lives. When that happens, experts say, many organizations are ill-equipped to properly support their employees -- in the worst cases, employees may even be penalized or fired.

Maya Raghu, a former lawyer with Futures Without Violence who was involved with the launch of this program, said only a handful of jurisdictions prohibit employment discrimination against survivors of domestic and sexual violence, and about 15 to 20 states provide survivors with unpaid leave.

“Having a source of income is critical to helping survivors and their families separate from the dangerous situation,” she said. “Especially if you are in a job on the lower end of the income spectrum, you may not be able to accumulate savings that you can rely on if you lose your job.”

Being a victim of violence can affect employees in overt and subtle ways. Workers may experience violence on the job, including stalking, threatening calls or physical assaults. Homicide is the second leading cause of injury death for women at work, according to the CDC, and intimate partners commit a significant percentage of those murders.

But even if the actual violence doesn’t take place at work, being in an abusive relationship can still disrupt a victim’s ability to do her job. Abusers may try to sabotage their victims’ financial independence and purposely do things to get them fired, like cut up their work clothes or steal their car keys so they miss their shifts, Raghu explained. 

Victims may need to take days off to appear in court, apply for a protection order or seek medical attention. But missing work can put victims of violence in peril of losing their job -- at the exact time they desperately need a regular paycheck.

Hott said the hospital's new policy spells out the support services available to victims, so they know they won’t be penalized for seeking help, and outlines what managers should do if a staff member discloses that they are experiencing domestic violence.

"If it’s brought to our attention, we can respond appropriately," she said. "We want employees to know, we are here for you, we want it safe for you here." 

Courtesy of University of Maryland St. Joseph Medical Center

St. Joseph Medical Center is working to institute a new workplace policy to help employees who are domestic violence survivors.

St. Joseph now works with victims to change their work schedules or location, and can assign them a new phone number or parking spot if requested, Hott said. Victims can also ask for an escort between buildings and to their car, and photos of prohibited people can be distributed to security staff.

Every employee will eventually go through a training about domestic violence and learn what resources are available in the community, Hott said. Educational posters featuring employees will be plastered across the facility, and bathrooms will include pamphlets about warning signs of domestic violence and phone numbers for help.

Ideally, she said, the hospital want to make it easier for employees to come forward and not feel like they have to handle it alone.

"In health care, we want to fix, we want to repair and get you out the door and back into your life. But intimate partner violence isn’t cut and dry," she said. "That’s OK. The goal is to make it not a secret anymore."

Hott said she hopes the hospital’s policy and training program will be used as a model for other health care organizations across the country. It’s an especially important sector to target, she said, as women make up nearly 80 percent of the health care workforce.

A young crepe myrtle tree stands at the entrance of the parking lot at St. Joseph.

Each morning when employees arrive for work, they pass the flowering tree, which was planted in memory of the two employees who were fatal victims of domestic violence.

"I pull into the garage that way every morning and I look at it," McKee said. "Now that it’s spring time, we look forward to it blooming."

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Melissa Jeltsen covers domestic violence and other issues related to women’s health, safety and security. Tips? Feedback? Send an email or follow her on Twitter.

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• This Is How A Domestic Violence Victim Falls Through The Cracks
• Men Offer Abhorrent Excuses For Killing Women. Don’t Repeat Them.
• We’re Missing The Big Picture On Mass Shootings
• A Legal Loophole May Have Cost This Woman Her Life

Mitsubishi Motors Admits Falsifying Fuel Economy Tests To Make Emissions Levels Look More Favorable

Mitsubishi Motors Corp said it falsified fuel economy test data to make emissions levels look more favorable, and its shares slumped more than 15 percent, wiping $1.2 billion from its market value on Wednesday.

Tetsuro Aikawa, president of Japan's sixth-largest automaker by market value, bowed in apology at a news conference in Tokyo for what is the biggest scandal at Mitsubishi Motors since a defect cover-up over a decade ago.

Toru Hanai / Reuters

The scandal prompted Tetsuro Aikawa, president of Mitsubishi Motors, to bow in apology at a news conference in Tokyo.

Shares in the company closed down more than 15 percent at 733 yen, the stock's biggest one-day drop in almost 12 years.

In 2000, Mitsubishi Motors revealed that it covered up safety records and customer complaints. Four years later it admitted to broader problems going back decades. It was Japan's worst automotive recall scandal at the time.

The company said on Wednesday the test manipulation involved 625,000 vehicles produced since mid-2013. These include its eK mini-wagon as well as 468,000 similar cars it made for Nissan Motor.

It said it would stop making and selling those cars, and has set up an independent panel to investigate the issue.

Mitsubishi Motors sold just over 1 million cars last year.

Mitsubishi Motors is the first Japanese automaker to report misconduct involving fuel economy tests since Volkswagen was discovered last year to have cheated diesel emissions tests in the United States and elsewhere.

South Korean car makers Hyundai Motor Co and affiliate Kia Motors Corp in 2014 agreed to pay $350 million in penalties to the U.S. government for overstating their vehicles' fuel economy ratings. They also resolved claims from car owners.

Target Raises Minimum Wage To $10 An Hour: Report

CHICAGO (Reuters) - Discount retailer Target Corp has started raising employee wages to a minimum of $10 an hour, its second hike in a year, pressured by a competitive job market and labor groups calling for higher wages at retail chains, sources said. Target management has informed store managers, who in turn have started informing employees about the wage hike and most employees who earn less than $10 per hour should see their base pay go up in May, two sources with direct knowledge of the situation told Reuters.

The $1-per-hour raise marks the second time Target has followed Wal-Mart Stores Inc in raising base wages. It also comes as a union-led push for a $15 minimum wage, the so-called “Fight for Fifteen” movement, is gaining traction in cities across the country and even has become a topic in the U.S. presidential campaign, with Democratic candidate Bernie Sanders calling for a $15 “living wage.”

Target's decision reflects growing competition for workers in an increasingly strong labor market. The number of Americans filing for unemployment benefits has fallen to its lowest point in 42-1/2-years, and the jobless rate is only 5.0 percent.

Target last raised its minimum pay rate in April 2015 to $9 an hour, up from the federal minimum wage of $7.25 per hour at the time. The move last April matched a similar announcement by Wal-Mart. The world's largest retailer in February 2015 said it will lift its base pay to $10 an hour in 2016, a step it has implemented in recent weeks. 

Target's plan will also raise pay for employees who already make over $10 an hour. Such workers will be entitled to an annual merit raise and a pay-grade hike, which is related to experience and position of the employee, said the sources, who spoke on condition of anonymity as they were not authorized to speak to the media.

Target declined to confirm it is offering the pay increase. "We pay market competitive rates and regularly benchmark the marketplace to ensure that our compensation and benefits packages will help us to both recruit and retain great talent, Target spokeswoman Molly Snyder said.

Snyder said the company does not disclose details of its compensation programs and declined to comment on how many of the retailer's roughly 341,000 employees at its nearly 1,800 stores would receive the raise.

The move to $10 an hour could put pressure on Target's earnings, especially at a time whenTarget is investing billions to upgrade its supply chain and technology infrastructure in order to tackle chronic stock shortages. Target also is pushing for higher online sales, which could potentially explain why it has lagged its larger rival in setting the lead on wage increases, analysts said.

"This move will make it difficult for Target to meet its aggressive profit projections," said Burt Flickinger, managing director of retail consultancy Strategic Resource Group.      

At its 2016 Analyst Day in March, Target said it expects annual gross margin rates around 30 percent.

Even before the wage hike, Barclays Capital Inc last month had downgraded the stock from 'overweight' to 'underweight.' At the time, Barclays analysts called the retailer's gross margin projections "optimistic" due to the threat of rising labor costs and other concerns.

Of the 26 analysts who cover the stock, 11 rate it a "buy," and 13 rate it a "hold," according to data from Thomson Reuters StarMine.

 

LABOR PROBLEMS

Target, which generally is considered to be a better employer due to its competitive wages and compensation-related benefits than many retail rivals, has in recent months seen a spate of labor-related issues.

Last September, Target lost a bid to prevent the formation of a micro-union by pharmacy workers in a New York store, which would have marked the first time Target employed unionized workers in one of its stores. Target later sold its pharmacy business to CVS Health Corp.

Then earlier this month, a Target group leader filed a lawsuit accusing the company of failing to pay overtime to workers with low-level management responsibilities at its warehouses in New York state.

Current and former employees contacted by Reuters this month said the retailer cut hours in an apparent effort to offset the impact of rising costs after it raised pay to $9 an hour last March.

Target's Snyder said the retailer has not changed how it approaches scheduling and hours in its stores.

A current part-time employee, who spoke on condition of anonymity as she was not authorized to speak to the media, said she averaged about 25-26 hours every week before March 2015, but has progressively seen her hours cut. She now averages at about 18-19 hours per week.

 

(Additional reporting by Nathan Layne in Chicago; Editing by David Greising and Nick Zieminski)

Our Coffee Addiction Could Destroy Earth’s Tropical Forests

Coffee producers may need a wake-up call.

Soaring demand for the caffeinated brew could hasten destructive climate change by encouraging producers to chop down some of the last remaining tropical forests as they struggle to increase yields on existing farmland, according to a report released Thursday by the nonprofit Conservation International.

Coffee grows in tropical countries near the equator, such as Indonesia, Brazil and Uganda, where thick jungles rich with biodiversity provide fresh water and store tons of carbon. Farmers expand their fields by felling trees in these forests and burning the dense underbrush -- releasing that carbon into the atmosphere, where it traps other gases and warms the planet. As a result, deforestation is a twofold environmental catastrophe: Left intact, forests absorb many of the pollutants that cause global warming. Destroyed, they unleash even more emissions and speed up the pace of climate change. 

Worse, it's a self-perpetuating cycle. As climate change worsens, the amount of existing farmland suitable for growing coffee shrinks. 

The underlying market force in all this is the skyrocketing demand for coffee. Coffee growers may have to triple their production by 2050 to meet current demand forecasts, the report predicted. Coffee demand is expected to spike 25 percent in the next five years alone, according to a report last year by the industry group International Coffee Organization. 

Consider the two maps below. The dark blue, red and yellow segments represent forested areas where certain types of coffee could be grown in Brazil in 2010.

Conservation International

Dark green represents forests not suitable for growing coffee. Different colors represent areas where certain types of coffee, such as Arabica or Robusta, can be grown. 

Now fast forward to the middle of the century. By 2050, much of the farmland where Arabica beans are produced, represented in light blue, is expected to recede. Farmland for Robusta, represented in light pink, nearly disappears.

Conservation International

Quite a change in just 40 years. 

"Ideally, plant breeders will develop new varieties that are adapted to the harsher conditions of the future, while, simultaneously, improving productivity.  That is a tall order, but not impossible," Tim Killeen, a lead author of the report, said in a statement. "If it doesn’t happen, then coffee production will shift to landscapes with conditions similar to today’s coffee growing areas.”

Tropical forests currently cover 60 percent of the land around the world that can be used for coffee production. By 2050, as much as 20 percent of the land suitable for growing coffee would fall within the boundaries of protected areas. That means farmers will either have to produce more with less land, or start clearing new lands on which to grow. Conservation International named the Andes, Central America and Southeast Asia as the regions of most concern.

There is a hope. Some of the world's biggest coffee sellers, such as Nestlé and Starbucks, have begun improving their supply chains to increase farmers' yields with more sustainable growing practices. But unless those efforts are stepped up, the quickened pace of deforestation and climate change may derail the progress already made. 

"Unless we act now, the trend of coffee production towards full sustainability may well be reversed," Peter Seligmann, founder and CEO of Conservation International, said in a statement. "The good news is that we know from our experience working with Starbucks and others that we can put the right practices in place to grow coffee in a way that protects forests and farmers -- but we need to keep pushing these techniques on a global scale."   

America’s 50 Biggest Corporations Are Hiding Over $1 Trillion Overseas

Corporate America’s accountants are having a tough week.

A government report revealed on Wednesday that a significant percentage of large, profitable U.S. corporations pay no federal taxes at all. A study released Thursday gives fresh insight into some of the practices that make those light tax burdens possible. 

The 50 largest U.S. corporations currently stash about $1.4 trillion in offshore tax havens, according to the analysis by anti-poverty group Oxfam America.

Between 2008 and 2014, these titans of big business -- a group that includes Apple, Coca-Cola and Disney -- together received approximately $27 in federal loans or similar aid for every $1 they paid in federal taxes, Oxfam America calculated. 

All together, the 50 biggest companies’ overseas tax avoidance techniques allowed them to pay an effective corporate income tax rate of 26.5 percent during those years, the nonprofit estimates. That is well below the official top rate of 35 percent.

Released just days before the deadline for Americans to file their tax returns, "Broken at the Top" seeks to expose how corporate tax dodging limits global governments' ability to address poverty.

“The vast sums large companies stash in tax havens should be fighting poverty and rebuilding America’s infrastructure, not hidden offshore in Panama, Bahamas, or the Cayman Islands,” Oxfam America president Raymond Offenheiser said in a statement accompanying the study.

Oxfam America relied primarily on data from the companies’ annual financial filings to the Securities Exchange Commission.

Other organizations have come up with slightly different numbers using similar research methods. A March study from the liberal Citizens for Tax Justice found that the 500 largest corporations are holding $2.4 trillion overseas, allowing them to avoid paying $695 billion in taxes.

The vast sums large companies stash in tax havens should be fighting poverty and rebuilding America’s infrastructure, not hidden offshore in Panama, Bahamas, or the Cayman Islands.Raymond Offenheiser, Oxfam America

There are a number of ways that American companies can legally offshore their profits to countries with lower tax rates. Technology and pharmaceutical companies, for example, often create subsidiaries in tax havens like Bermuda, to which they transfer the intellectual property and patents that earn them a large share of their total profits. Companies whose workforces and sales are primarily in the U.S. and other high-tax nations end up claiming that a disproportionate share of their profits were earned overseas.

Another tactic that has grown more popular in recent years, but which has also come under increased scrutiny, is corporate inversion. American companies that “invert” acquire foreign firms in order to reincorporate in lower-tax countries.

Oxfam America’s report could add to the recent uptick in public awareness of corporate tax avoidance and the pressure on policymakers to address it. The release of the Panama Papers, a leaked cache of documents from a Panamanian law firm, made waves earlier this month by exposing the elaborate tax-dodging schemes of the super-rich.

President Barack Obama cited the Panama Papers while touting a new Treasury Department rule aimed at curbing corporate inversions.

The main purpose of tax reform should be to fund the government, and anything else is just a waste of time.Bob McIntyre, Citizens for Tax Justice

Defenders of corporate tax strategies blame the official U.S. corporate tax rates, which are among the highest in the world. The United States, they note, is also one of the few countries that taxes foreign earnings at domestic rates. A “territorial” system in which profits are taxed at the rates of the countries where they are earned is more common.

But thanks to a tax "deferral" loophole, U.S. companies only pay domestic taxes on foreign earnings if they "repatriate" the earnings by bringing them back to the U.S. That gives companies a particular incentive to hoard money elsewhere -- sometimes indefinitely -- in order to defer taxation.

Obama has proposed a framework for corporate tax reform that would embrace lower rates and fewer loopholes with the goal of at least maintaining current revenue levels from corporate taxes -- and increasing corporate investment at home.

“Whether you are a liberal or a conservative, you want to get that tax rate down,” said Martin Sullivan, chief economist at the tax news and analysis website Tax Analysts.

“If the Obama administration, which I think has been the most aggressive of any administration in recent history in trying to shut down this problem,” does not think it can be solved through enforcement alone, no president will, Sullivan argued.

Many progressive fair taxation advocates, however, contend that the government can and should rely solely on closing corporate tax loopholes to bring companies into line and replenish federal coffers.

Bob McIntyre, director of Citizens for Tax Justice, said one simple way to do that would be to end the foreign tax deferral loophole that allows companies to avoid domestic taxes until they repatriate the earnings. That way they would have to pay domestic taxes on foreign profits even if they are holding it elsewhere.

Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) has made the change part of his campaign platform. 

To stop inversions, McIntyre suggested, the government could force companies to pay a so-called exit tax before leaving the U.S., taxing the profits they had earned overseas up to that point. Hillary Clinton, Sanders’ rival for the Democratic presidential nomination, backs that idea. 

McIntyre rejects the notion of lowering corporate taxes to compete with lower tax nations.

“The main purpose of tax reform should be to fund the government, and anything else is just a waste of time,” he concluded.