What to Expect in Indiana's Metro Economies during 2016
Economists from around the state shared their forecasts for Indiana’s metropolitan economies during the Indiana Business Outlook Panel tour and in the online edition of the Indiana Business Review. Here are some highlights of how our panel of experts predict employment will change in 2016.
Dr. Terry Truitt, Anderson University
For 2016, employment in Madison County is expected to continue improving, with a moderate decline in the unemployment rate and a tempered increase in employment. The unemployment rate is projected to drop between 0.8 and 1.4 percentage points in 2016 as the regional economy continues to improve. The number of jobs in Madison County is expected to hold steady, increasing about 1.5 percent over the year.
Dr. Jerry Conover, Indiana University
The IBRC’s Center for Econometric Model Research forecasts 2016 employment growth of about 2 percent for the Bloomington metro area, ranking it in the top handful of Indiana’s 14 metropolitan areas. This growth forecast reflects gradual improvement in the national and state economies, continued population growth, further momentum in construction and in professional and technical services, and a strengthening housing market.
Dr. Ryan Brewer, Indiana University–Purdue University Columbus
In 2015, Columbus had one of the lowest unemployment rates in the state. The Columbus economic outlook for 2016 is neutral to slightly negative, with reasons for continued growth overshadowed by suspicions that the economic expansion seen in Columbus over the last seven years may be facing headwinds.
Elkhart-Goshen and South Bend-Mishawaka
Dr. Hong Zhuang, Indiana University South Bend
Employment will increase in both metro areas in 2016, with Elkhart-Goshen exhibiting faster job growth due to the lion’s share of manufacturing activities in local economy. More people are expected to join the labor force in both areas. Unemployment rates will remain steady, ticking down at most 1-2 percentage points in 2016 because the unemployment rates are very close to 10-year lows.
Dr. Mohammed Khayum, University of Southern Indiana
Relatively strong growth in manufacturing and retail trade, combined with increases in personal income and announcements of future fixed investments, provide the basis for projecting increased output, income and employment in 2016. In 2016, the number of jobs is projected to increase by 2,500, and the unemployment rate is projected to be 4.3 percent.
Ellen Cutter, Indiana University–Purdue University Fort Wayne
Based on EMSI, Inc. projections and Community Research Institute analysis, we presume that employment in the region will be modest in 2016, perhaps growing by about 1 percent in the three-county metro area. Even with this, unemployment may plunge farther down as demand for workers is induced by the continuation of baby boomer retirements.
Dr. Micah Pollak, Indiana University Northwest
In 2016, the Northwest Indiana economy is forecasted to grow at only 1.0 percent with regional employment expanding by only 0.4 percent, or the addition of approximately 1,100 jobs. While any economic growth and job expansion is a positive sign for the region, growth at this rate would still leave the region approximately 9,800 jobs (or 28 percent) below the pre-financial crisis employment high in 2007.
James C. Smith, Indiana University
The economic climate in Indianapolis in 2016 is likely to be a continuation of the flat conditions in 2015. Total nonfarm employment is expected to grow about 1 percent, and the unemployment rate should stabilize around 4 percent.
Dr. Alan G. Krabbenhoft, Indiana University Kokomo
Unemployment rates within the north-central Indiana region should remain relatively stable for the foreseeable future, with the possibility of some slight continued downward movement. Durable goods manufacturing is critical to the Kokomo region, so eyes will be focused on economic conditions throughout the U.S. and even globally.
Tanya Hall, Purdue University
In 2016, it is expected that employment growth in the Lafayette metro will closely mirror 2015 results, with a potential gain of 3,200 jobs. A pullback in the manufacturing sector might occur; however, it may be offset by other industries’ growth given the news reports of business growth in 2015.
Dr. Uric Dufrene, Indiana University Southeast
In 2016, the Louisville metro will see moderate growth, but Southern Indiana will continue to experience quarters of impressive gains due to the River Ridge commercial area and the completion of the Ohio River Bridges Project.
Dr. Dagney Faulk and Nathanial Law, Ball State University
The past year provided hints of increased economic activity, suggesting that Muncie may be moving beyond the long, slow recovery. In the coming year, we expect 1 percent growth in employment, as well as higher incomes (3 to 4 percent growth) within the Muncie metro.
Dr. Lee Zhong, Indiana University East
Economic growth in the Richmond and east-central Indiana region will likely remain in positive territory, but growth will be moderate due to headwinds from the national and international economies. The unemployment rate is likely to hover in the 5-6 percent range.
Dr. Robert Guell, Indiana State University, and Kevin Christ, Rose-Hulman Institute of Technology
It is unlikely that there will be any significant change in the Terre Haute labor market in 2016, with unemployment staying around 5.8 percent. Given the historic relationship between regional employment trends and national and state-level economic activity, the regional economy faces significant risks going forward. Barring bold new thinking, the most likely scenario seems to be for continued stagnation.
Visit www.ibrc.indiana.edu/ibr to read the in-depth metro analyses, as well as projections for the nation, state, financial markets and more.