The performance of the Bloomington-area economy reveals a pattern of growth mixed with challenges. Summarized below is our analysis of local area performance across a variety of measures and our forecast for 2017.
Local economy growing gradually
The Bloomington Metropolitan Statistical Area (MSA) economy, consisting of Monroe and Owen counties, expanded in 2015 for a second straight year, though by less than 1 percent (about $44 million in real-GDP terms). (1) This upturn follows three years of local post-recession shrinkage (see Figure 1). Despite the recent growth, however, the local economy is still $295 million smaller than it was in 2010.
Given Bloomington's weak GDP growth coupled with its continued population growth, the metro area's real GDP per capita was essentially flat in 2015 at $35,501--just two-thirds of the national per capita GDP and more than $3,400 below Bloomington's 2009 peak (which was 78 percent of the U.S. metro average). In contrast, the nation's combined metropolitan economies grew by an average of 6.2 percent since 2009. Over the 2005-2015 period, GDP per capita in the nation's metro areas averaged 13.1 percent growth, well above the 7.4 percent gain in the Bloomington area. Thus, the Bloomington economy is falling farther behind the average metro area.
Manufacturing remained the largest contributor to the area's economy last year, generating 22.7 percent of total GDP, although the sector's output shrank slightly from the year before. Government was close behind at 22.4 percent; these two sectors combined account for nearly half of the local economy--more than $2.6 billion.
Trends in several sectors over the past decade are shown in Figure 2. The biggest swings across these years are seen in the real estate, rental and leasing industry, which grew more than 50 percent from 2005 to 2009--only to drop to the 2005 level again by 2013. Since then, the sector has grown slowly. Manufacturing experienced similar swings in local output, peaking in 2010 (nearly 40 percent above its 2005 level), only to surrender most of that gain by 2013. The two subsequent years have witnessed only slight growth in local manufacturing output.
The education, health care and social services sector has grown gradually through most of the decade, with a mild retreat in the past two years. In contrast, the finance and insurance industry has had the most volatile ride over the past 10 years, finally starting a period of impressive output growth...