Construction, manufacturing may lead economic recovery

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Year In Review

There comes a point in a long night of boozing when you can’t get any drunker. Realizing that might prompt you to call a cab, but it won’t prevent a hangover.

The economy seemed to follow a similarly painful path in 2010. The recession came to an official end 18 months ago, but Indiana’s unemployment rate hovered around 10 percent. That left most Hoosiers with the economic equivalent of popping ibuprofen and sipping water.

There are some bright spots on the horizon, though.

A number of software firms announced expansions, including the e-mail marketer ExactTarget, which will hire 500 people at its downtown Indianapolis headquarters.

Diesel-engine giant Cummins added jobs in Seymour and said it will expand its Columbus headquarters. The beleaguered automotive sector cranked up its production lines, though employment levels remain down.

The pockets of growth alongside devastation in certain industries—real estate and construction—make reading the economy tricky.

“The slow and uneven job growth combined with shockingly fast productivity growth eerily signals that much of our economy has gone through a structural change,” noted Michael Hicks, director of Ball State University’s Center for Business Research.

What that suggests, Hicks said, is that many of the 8 million U.S. jobs that evaporated won’t come back in the same industries. “If that is so, and I am afraid it is, it heralds a long and painful readjustment.”

Indianapolis seems poised to bounce back relatively quickly. Newsweek in November listed Indianapolis as one of 10 cities in the nation that’s best-situated for recovery, thanks to affordable housing, a growing population and a pro-business climate that’s attractive to a variety of industries, from life sciences to motorsports.

Hicks predicts a slowly improving 2011. He thinks unemployment will fall throughout the year to 8.7 percent, and personal income will rise 4.81 percent.

The fastest-growing industries will be those that have seen the biggest losses: construction, manufacturing and transportation, Hicks predicted.

“There is some good news,” he said. “We economists and our models did a poor job of predicting this recession, and the nature of the mathematics underlying the models suggests they are more likely to underestimate the rate of recovery than overestimate it.”•


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  1. I never thought I'd see the day when a Republican Mayor would lead the charge in attempting to raise every tax we have to pay. Now it's income taxes and property taxes that Ballard wants to increase. And to pay for a pre-K program? Many studies have shown that pre-K offer no long-term educational benefits whatsoever. And Ballard is pitching it as a way of fighting crime? Who is he kidding? It's about government provided day care. It's a shame that we elected a Republican who has turned out to be a huge big spending, big taxing, big borrowing liberal Democrat.

  2. Why do we blame the unions? They did not create the 11 different school districts that are the root of the problem.

  3. I was just watching an AOW race from cleveland in 1997...in addition to the 65K for the race, there were more people in boats watching that race from the lake than were IndyCar fans watching the 2014 IndyCar season finale in the Fontana grandstands. Just sayin...That's some resurgence modern IndyCar has going. Almost profitable, nobody in the grandstands and TV ratings dropping 61% at some tracks in the series. Business model..."CRAZY" as said by a NASCAR track general manager. Yup, this thing is purring like a cat! Sponsors...send them your cash, pronto!!! LOL, not a chance.

  4. I'm sure Indiana is paradise for the wealthy and affluent, but what about the rest of us? Over the last 40 years, conservatives and the business elite have run this country (and state)into the ground. The pendulum will swing back as more moderate voters get tired of Reaganomics and regressive social policies. Add to that the wave of minority voters coming up in the next 10 to 15 years and things will get better. unfortunately we have to suffer through 10 more years of gerrymandered districts and dispropionate representation.

  5. Funny thing....rich people telling poor people how bad the other rich people are wanting to cut benefits/school etc and that they should vote for those rich people that just did it. Just saying..............