Lafayette.

• Author: Smith, James C.
• Position: Economic forecast for Lafayette, Indiana - Brief Article - Statistical Data Included

Which metropolitan area in Indiana has the strongest economy? Of all the metro areas apart from Indianapolis, Lafayette probably turned in the best performance during the long economic boom of the 1990s.

The Indianapolis metropolitan area was unusually prosperous during the past decade and led the state in almost every category. But Indianapolis is much bigger than any other Indiana metro area, so it is perhaps unfair to include it in the comparisons. Not counting Indianapolis, then, Lafayette was arguably the strongest of the 11 other metro areas. Consider the evidence (see Table 1):

Population Growth. With a 13.2 percent growth rate from 1990 to the 2000 census, the Lafayette metro area, which encompasses Tippecanoe and Clinton counties, was the second fastest growing metro area in the state outside Indianapolis. It was only edged out by Elkhart at 17 percent. Total population in the metro area was 182,821 at the 2000 census.

Job Growth. From September 1995 to September 2001, the Lafayette area added 4,500 jobs, an increase of 6 percent. That was the highest percent increase of any metro area other than Indianapolis.

Unemployment Rate. In September 2001, the Lafayette metro area had the lowest unemployment rate in the state, at 2.9 percent. Outside Indianapolis, only Bloomington can rival Lafayette for low unemployment.

Commute Ratio. The ratio of the number of commuters into an area compared to the number out of the area is an indicator of economic attractiveness and economic independence. Some suburban counties, for example, send many more commuters out to the nearby city than they attract. Tippecanoe County, however, had a ratio of five to one in 1999 (the most recent data available). That means five times more people commuted into the county than commuted out. Apart from Marion County, at 6.1, Tippecanoe had the highest commute ratio in Indiana.

Growth in Services Industries. All over Indiana, manufacturing has dominated the economic mix. But a more diverse economy helps protect against the unemployment and loss of revenue that recessions bring. Services industries, therefore--especially health care, business services and management services--have been a focus for economic development. From September 1996 to...