The Lafayette Metropolitan Statistical Area (MSA) returned to its tortoise pace on our less-than-robust economic recovery from the Great Recession. In 2016, the manufacturing and mining/logging/construction industries were the source of employment growth, serving as a contributing factor to dropping unemployment rates, increased employment and increased wages in the area.
The Lafayette MSA (which includes Tippecanoe, Benton and Carroll counties) has rebounded from that recession in a sustainable fashion with slow and steady growth--albeit frustratingly slow at times. Looking toward the future, there is little doubt that growth will continue, thanks to its diverse industry portfolio and strong university connection. These strengths coupled with its geographic location make it an attractive area to live and work.
The MSA has experienced continuous population growth--an addition of approximately 2,600 people per year between 2005 and 2015 (see Figure 1). The 2015 population is 214,363, and the Indiana University Center for Econometric Model Research anticipates annual population growth of 0.8 percent in the region through 2019.
The Lafayette MSA maintained a lower unemployment rate than the United States between August 2015 and September 2016 (see Table 1). The MSA also maintained lower unemployment rates relative to the state as a whole, except in March and July 2016. These lower unemployment rates reflect the diverse and strong economy within the Lafayette MSA. Last year's outlook predicted the MSA would see upper 3 percent unemployment rates, and that did occur a few times. In 2017, the local unemployment rate should continue to range between 3.5 and 4.5 percent due to steady economic growth.
A year-over-year comparison between September 2015 and 2016 shows that employment increased by 4,172 workers.
Table 2 looks specifically at regional employment between 2015 and 2016 in the Lafayette MSA. Last year, it was anticipated that most of the employment growth would stem from professional and business services, with the potential for pullback in the manufacturing industry. However, though the MSA has had an increase in jobs thus far in 2016 (756 employees, or 0.7 percent), much of the gain came from goods-producing industries--manufacturing and mining/logging/construction industries (+533 workers).
Professional and business services had the largest industry decline in numeric terms (-117 employees). Other industries with employment declines were also in the service-providing industries (information; other services; and trade, transportation and utilities), as well as government.
As of September 2016, the top three industries in the Lafayette MSA are manufacturing (18 percent), trade, transportation and utilities (15 percent) and private educational and health services (12 percent). These top industries are reflective of the many manufacturing firms and...