Construction, manufacturing may lead economic recovery

Back to TopCommentsE-mailPrintBookmark and Share
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.”•


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ
  1. President Obama has referred to the ACA as "Obamacare" any number of times; one thing it is not, if you don't qualify for a subsidy, is "affordable".

  2. One important correction, Indiana does not have an ag-gag law, it was soundly defeated, or at least changed. It was stripped of everything to do with undercover pictures and video on farms. There is NO WAY on earth that ag gag laws will survive a constitutional challenge. None. Period. Also, the reason they are trying to keep you out, isn't so we don't show the blatant abuse like slamming pigs heads into the ground, it's show we don't show you the legal stuf... the anal electroctions, the cutting off of genitals without anesthesia, the tail docking, the cutting off of beaks, the baby male chicks getting thrown alive into a grinder, the deplorable conditions, downed animals, animals sitting in their own excrement, the throat slitting, the bolt guns. It is all deplorable behavior that doesn't belong in a civilized society. The meat, dairy and egg industries are running scared right now, which is why they are trying to pass these ridiculous laws. What a losing battle.

  3. Eating there years ago the food was decent, nothing to write home about. Weird thing was Javier tried to pass off the story the way he ended up in Indy was he took a bus he thought was going to Minneapolis. This seems to be the same story from the founder of Acapulco Joe's. Stopped going as I never really did trust him after that or the quality of what being served.

  4. Indianapolis...the city of cricket, chains, crime and call centers!

  5. "In real life, a farmer wants his livestock as happy and health as possible. Such treatment give the best financial return." I have to disagree. What's in the farmer's best interest is to raise as many animals as possible as quickly as possible as cheaply as possible. There is a reason grass-fed beef is more expensive than corn-fed beef: it costs more to raise. Since consumers often want more food for lower prices, the incentive is for farmers to maximize their production while minimizing their costs. Obviously, having very sick or dead animals does not help the farmer, however, so there is a line somewhere. Where that line is drawn is the question.