The virus pandemic has disrupted our lives and, in many cases, done serious harm to our livelihoods. Working from home helps some, but not all workers can benefit. Without such serious disruption, we take commuting for granted. Most Hoosiers work and live in the same county, but there are many who cross county and state lines for work. In doing so, they move a lot of money.
According to the U.S. Bureau of Economic Analysis, in 2018, workers in Indiana earned $220.6 billion. But not all of that appeared in their paychecks. They, and their employers, contributed $24.7 billion (11.2%) to federal government insurance programs (Social Security, disability insurance, Medicare, etc.) that provide our economic safety net.
Thus, working for Hoosier businesses and governments netted $195.9 billion. Yet, as we know, “foreigners” from Illinois, Ohio, Michigan and Kentucky come into our state and take home money earned here. Fortunately, Hoosiers also cross state lines and bring back money they earn in those “alien” lands.
The money brought back to the Hoosier Holyland exceeded the money taken out by $6.8 billion in 2018. On balance, Indiana benefits from interstate commuting. Plus, this “commuting surplus” grew over the past decade by 45.4%, faster than earnings generated in our state which grew by 35.3%.
Those figures are the decoration atop the cake. Commuting moved $73.6 billion across Indiana county lines in 2018. Some counties are labor importers and money exporters, while others are residential exporters and money importers.
Brown County was most dependent on commuting with 64.5% of its residents’ employment earnings coming from other counties. In all, 72 of Indiana’s 92 were beneficiaries of net commuting inflows. Ten counties, including Morgan, Warrick and Harrison, were net importers of 50% or more of their earnings from work.
At the other end of the spectrum, the leading exporter of earnings as a result of commuting was Martin County, where two-thirds of earnings left the county. Others in the top five earnings exporters included Marion (33.4 %), Gibson (29.8%), Elkhart (26.9%), and Bartholomew (24.2%).
There is a bi-polar aspect to all this. Many chambers of commerce and local governments insist commuting leaves us with winners and losers. They argue money earned in their city or county belongs there. People should live where they work. Some end up arguing housing should be built where there is work to be had.
Simultaneously, these players may hold the location decisions of firms and households as sacrosanct. They line up for individual or corporate choice, free of community or government interference. They extoll unencumbered choice as the (Milton) Friedmanic foundation of our society.
Another faction tells us to focus on congestion and environmental damage associated with commuting. They endorse enforceable codes and detailed planning. However, no one truly has the power nor the will to face up to these issues.
Morton Marcus is an economist. Reach him at [email protected]. Follow his views and those of John Guy on “Who gets what?” wherever podcasts are available or at mortonjohn.libsyn.com. Send comments to [email protected].
