Indianapolis-Carmel forecast 2018.

• Author: Anderson, Kyle
• Position: Statistical data

The 2018 outlook for the Indianapolis-Carmel-Anderson metropolitan area (1) economy is strong. Job growth in the region has been some of the strongest in the state, as unemployment continues to fall in central Indiana. Indianapolis metro area unemployment is 3.8 percent, which represents full employment. Wages are rising, which means the benefits of economic growth will be felt across the entire economy.

Employment and wages

The Indianapolis-Carmel-Anderson economy added 24,700 jobs over the past 12 months, an increase of 2.3 percent. This reduced the unemployment rate from 3.7 to 3.4. The current civilian workforce stands at 1.06 million workers, and of those, only 36,000 are unemployed. This represents an extremely tight labor market that will create a challenge for businesses looking to grow. However, it is a good sign for the local economy, as consumer spending and housing should benefit from full employment.

The local economy will continue to add jobs in 2018. Last year, the workforce grew by 2.0 percent, a trend that will need to continue in order to fuel employment growth. Fortunately, the Indianapolis area continues to be an attractive place for individuals and families, so that our working-age population grows.

Given the tightness of the labor market, we expect wages to continue rising. Over the last four quarters, average weekly wages have risen at an average annualized rate of 4.2 percent. This is the highest level of wage gains since before the 2008 recession. This trend will continue into 2018.

Evolution of the metro economy

To get a feel for the evolution of the economy, it is sometimes helpful to examine job announcements by some of the larger employers in the area. Technology companies Salesforce and Infosys have both announced an expansion in downtown Indianapolis that will bring as many as 3,000 new tech jobs over the next few years.

Indianapolis is an attractive option for many companies due to its affordable cost of living, especially compared to traditional technology areas, such as San Francisco and Seattle. A growing number of tech startups also contribute to the local economy. Together, these opportunities will help to attract and retain highly educated, younger workers in the area.

Not all of the expansion is due to technology. UPS is expanding operations in Plainfield, with plans to add more than 500 jobs in the area. While each of these job announcements are small in an economy with 1 million jobs, they give a...