Bloomington.

• Author: Smith, James C.
• Position: Economic outlook for Bloomington, Indiana - Brief Article

The headlines in Bloomington about layoffs and plant closings might lead you to believe the area entered a recession a year ago. So why has the unemployment rate in Bloomington been among the lowest of any metropolitan area in the state? How much will Bloomington be affected by the nationwide recession?

In the third quarter of 2001, Bloomington posted an unemployment rate of 3.3 percent. Among the 11 metropolitan statistical areas in Indiana, only Lafayette at 2.7 percent and Indianapolis at 3.1 percent were lower. (The Indiana portion of the Louisville MSA also had a third quarter rate of 3.1 percent. The Louisville metro area as a whole, however, was at 3.8 percent.) And Bloomington has maintained its unemployment rate advantage over the rest of the state for many years (see Figure 1).

[FIGURE 1 OMITTED]

It turns out there is more strength in the Bloomington economy than the publicity about layoffs would suggest. Layoffs get headlines; the hirings that have continued, one person at a time, at many Bloomington area firms do not.

The Bloomington metro area, which includes all of Monroe County, was home to 120,563 people as of the 2000 census (college students are counted as residents). That figure represented a 10.6 percent growth rate over 1990. Indiana's population statewide grew 9.7 percent. This moderate but steady growth in the number of residents is one thing that continues to fuel the area's economy, as more people bring their spending to Bloomington.

The mix of jobs people in Bloomington hold has shifted in a way that has helped blunt the effects of the 2001-2002 recession so far. In 1995, 16 percent of the area's employment was found in manufacturing industries. The annual average for 2000 was down to 14 percent. Since manufacturing employment has led the decline nationwide in this recession, Bloomington has slightly less exposure than in the past.

Nevertheless, the manufacturing sector cost Bloomington...