Fort Wayne forecast 2009.

• Author: Stafford, John

November 2008, updated December 2008

What a difference a year makes. The outlook prepared last year for the Fort Wayne area referenced concern over the "ongoing turmoil in the domestic automotive industry impacting the supply network" and the "slump in housing construction caused in large measure by the crisis in single-family housing finance issues."

There was no reference, however, to "the worst financial market crisis in decades."

Clearly, the severity of the national and international economic downturn will dominate what happens in the local economy. Just how severe that impact will be is the difficult question to answer.

We will use the seven-county Fort Wayne Combined Statistical Area as the geographic definition of the Fort Wayne area. This includes Adams, Allen, DeKalb, Huntington, Noble, Wells, and Whitley counties.

We have had five previous national business cycle contractions since the early 1970s. (1) Each one has been somewhat unique in its impact on employment in this area--both in the length of its duration and the extent of employment loss in the Fort Wayne area.

* 1973-1975: The contraction beginning in November 1973 lasted sixteen months nationally. The seven-county Fort Wayne area experienced a 6.1 percent decline in total employment between 1974 and 1975, a loss of nearly 12,500 jobs.

* 1980: The national contraction beginning in January 1980 lasted six months and we experienced a loss of nearly 14,700 jobs in the area between September 1979 and April 1980.

* 1981-1982: The second component of that double-dip recession began nationally in July 1981 and lasted for sixteen months. Employment in the region began to drop in October 1981 and declined thirteen of the next fifteen months, dropping by more than 16,000 jobs. If these two nearly back-to-back events are combined, the Fort Wayne area experienced an 11.6 percent decline in employment between 1979 and 1982 with a total loss of nearly 26,000 jobs.

* 1990-1991: A national contraction began in July 1990 and lasted eight months. Its effect on the Fort Wayne area was relatively modest with a 2.7 percent decline in employment between October 1990 and March 1991. The drop in area employment during that period was approximately 6,600 jobs.

* 2001: A national contraction that began in March 2001 also lasted eight months. However, the Fort Wayne area was hurt more substantially with a loss of nearly 18,000 jobs between 2000 and 2003, a decline of 5.8 percent. It is difficult to...