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MARCUS: Indiana jobs situation is improving

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Morton Marcus

“Is it true that Indiana’s economy has turned around?” Strudel Morceaux, a junior journalist asked.

“I cannot answer that question.” I said.

“What?” Strudel ex-claimed. “You’re the economist and you don’t know what’s hap-pening with Indiana’s economy?”

“What,” I asked, “is Indiana’s economy?”

“Now you’re playing mind games,” Strudel objected.

“Indiana’s economy is measured in different ways and judged in still other ways,” I elaborated. “For many people, an economy is doing well if it is adding jobs. For others, an economy’s performance is judged by its unemployment rate. Those are only two of many measures.”

“Enough,” Strudel said, beginning to flake.

“Indiana’s latest unemployment rate was 10 percent for the second consecutive month,” I offered. “That’s not satisfactory, but better than the 10.6 percent of a year ago. The decline in the number of people employed that lasted nearly two years seems over. From February 2008 through last December, Indiana had a decline of 284,500 workers holding jobs.

“Then, in the first five months of this year, Indiana enjoyed an increase of 23,100 people employed. This represents just an 8-percent recovery—not quite enough to set off firecrackers.”

“So,” Strudel said confidently, “we’ve hit bottom and the turnaround is in progress.”

“There is reason to say that,” I said. “When we look at jobs, rather than employed people, … .”

“Hold it!” Strudel cried. “Every job is filled by a person.”

“Yes,” I agreed, “but many people hold more than one job. Jobs are not equal to the number of people working. Plus, some Hoosiers work outside Indiana and some Indiana jobs are held by people living beyond the Hoosier frontiers.”

“Piffle,” Strudel said, dismissing the distinction.

“Possibly piffle,” I conceded. “Yet it explains why the number of jobs and number of employed people are different. Nonetheless, let me continue.

“Every month from March 2008 to April of this year, the number of jobs in Indiana was less than in the same month a year earlier. You might say we hit bottom in June 2009, when the number of jobs fell to 201,400 fewer than in June 2008. Since then, that difference has been shrinking. Now, in May, for the first time in 27 months, the number of Hoosier jobs exceeded the level of a year earlier.

“The truly good news is that, for nearly two years, stretching back to the spring of 2008, the number of jobs in Indiana fell by 229,400. Since the start of this year, we’ve added 53,200 jobs, a recovery of nearly a quarter of our lost jobs.”

“Then you’ll agree that we’re on the road back,” Strudel said triumphantly.

“No,” I said. “I want to know that average wages are rising for Hoosiers. I want evidence that government revenue is increasing and that more money is being spent on the necessities of life—things like education, transportation, communications and public health. It won’t do us any good to meet the usual demand for Halloween costumes if we’re not investing in our future.”

“You just won’t accept the good news, will you?” Strudel said angrily.

“Right,” I said. “We have a long-term deficit of responsible spending in this state. The restoration of things as they were will not lead to a productive, competitive economy tomorrow. Patting ourselves on the back because we moved part-way back from a business-cycle low is deceptive and cynical; it might be acceptable from a political candidate, but not appropriate from you as a serious observer of our state’s economy.”

“I’m sorry I asked,” Strudel said. “I was just looking for a quick quote.”•

__________

Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.

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  1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

  2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

  3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

  4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

  5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

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