How should we measure the economic success of a county? Let’s try three factors that, taken together, might give us a sense of where our county economies have been. Our study will cover the decade 2008 to 2018. That’s just when the Great Recession hit in full force right up to just before this year. We’ll look at the percent change in
1. The number of private-sector jobs in the county
2. The number of private sector establishments
3. The average annual real wage of those jobs.
Finally, we’ll be generous and call a county a Leader if it has at least 1 percent growth in each of those three factors over 10 years. However, a county with less than 1 percent growth in each of those three factors over 10 years we’ll call a Loser. (Data for one county was missing.)
Jobs: 49 of Indiana’s 92 counties had an increase of 1 percent or more between 2008 and 2018. The rest of our counties failed this very modest 1 percent test. Actually, 38 counties ended the decade with fewer jobs than in 2008. Statewide, the growth in jobs was 7.9 percent.
Establishments: Only 18 counties saw more than a 1 percent increase in places to work, shop, eat or otherwise engage in commerce. You would expect a bustling economy to have a growing number of places to do business. In Indiana, 67 of our 92 counties saw a decline in establishments. Statewide, the number of establishments grew by 4.5 percent.
Wages: Average wages, adjusted for inflation, advanced by more than 1 percent in 81 Indiana counties. They declined in only 10 counties. The statewide increase in wages was 6.8 percent.
Leaders: Boone, Hamilton, Hancock, Johnson and Hendricks were five of the 16 counties that met our test of 1 percent growth in all three factors. All five are adjacent to Marion County, which itself did not qualify as a Leader, according to our modest criteria.
Lake and Porter were also Leaders. However, each of these Northwest Indiana counties was barely above our lower boundary for success in establishments and job growth, Porter did well (+14.3 percent growth in real wages), but Lake managed only 2.3 percent increase.
What kind of economy has a 60 percent increase in jobs, but less than 3 percent growth in real wages? That was Hendricks County, first in Indiana for the rate of job growth and 72nd for wage growth.
Either wages are already so high in Hendricks and other Indianapolis-area counties that workers flock there without forcing employers to raise wages; or the many jobs being created in those donut counties are low-paying with many workers available to take such employment.
Losers: Only six counties Indiana counties failed to meet our 1 percent growth test in all three factors. They were Ohio, Greene, Fayette, Pike, Vermillion and Dearborn.
No doubt special factors in each county accounted for its poor showing. Ohio County’s casino, for example, experienced flooding last year, while its owner begs the legislature to let him move the gaming license.
Many will disagree with the designation of Leaders and Losers offered here. But the state of Indiana seems to have no comparative criteria, no distinguishing metrics on which to base its investments. Indiana has laisse faire economic development because the state dares not to differentiate between sites for growth and offers no policies to mitigate economic decline.
Morton Marcus is an economist, formerly with the Indiana University Kelley School of Business. Send comments to [email protected].
