New Albany.

• Author: Faulk, Dagney
• Position: Indiana Metro Areas - Economic indicators

During 2004, the economy of southern Indiana continues to sputter. Average employment in the Louisville Metropolitan Statistical Area (MSA), and in southern Indiana in particular, continues to decrease for the fourth year in a row. Yet, indicators of consumer activity continue to improve. In this analysis, various measures of economic activity are examined in seven counties in the Louisville MSA: Clark, Floyd, Harrison, and Scott counties in southern Indiana and Bullitt, Jefferson, and Oldham counties in northern Kentucky. (1) Four additional Indiana counties--Crawford, Jefferson, Orange, and Washington--in the southern Indiana labor market area are included when data are available.

Labor Markets

The September 2004 unemployment rates in many of the Indiana counties of the Louisville area have increased relative to the September 2003 rates. From month to month, unemployment rates in these counties are quite volatile. Figure 1 illustrates that the unemployment rates continue to fall below that of the United States. Several counties consistently have unemployment rates that are lower than the Indiana state average, with the exceptions being Crawford, Orange, and Washington counties, which consistently have unemployment rates higher than the state.

[FIGURE 1 OMITTED]

Recent data for the Louisville MSA indicates that the average level of nonagricultural employment was 559,500 for the January-September 2004 period. This is a decrease of approximately 700 jobs from the same period last year and a decline of over 30,000 jobs since 2000. Total nonagricultural employment in the southern Indiana counties averaged 93,200, a decrease of about 800 jobs over the same period last year (see Table 1) and well below the May 2001 peak of 98,200 jobs.

Revised employment numbers revealed that manufacturing employment in the southern Indiana counties of the metro area has been decreasing steadily over the past several years. They averaged 17,700 jobs for the January-September 2004 period, a 600 job decline over the same period in 2003. Manufacturing employment has been steadily decreasing from the January 2001 peak of 21,100 jobs. For the MSA as a whole, manufacturing employment decreased by approximately 1,400 jobs during the first three quarters of 2004. In addition to manufacturing, the trade, transportation and utilities sector in southern Indiana was hit hard over the past year, decreasing by an average of 600 jobs. Job growth was led by the wholesale trade...