Richmond forecast 2017.

AuthorZhong, Litao

Economic activity continued to expand in the Richmond region (1) throughout 2016. Strong expansion was seen in the size of the Wayne County labor force, and local unemployment rates remained low. Most businesses kept adding jobs, wage growth inched up in several industries, and housing prices and turnover held the line. The 2017 outlook is optimistic based on the most recent survey of the business community, though uncertainties in domestic and global markets could hamper our region's growth.

Measures of economic activity

The local labor force displayed fairly strong expansion in both Wayne County and the Richmond region (see Figure 1 and Figure 2). The labor force includes employed workers and workers who are unemployed but are actively looking for work. Compared to August 2015, the size of the labor force increased by 2.5 percent in Wayne County and 3.1 percent in the region in August 2016.

On average, there were 369 more people in Wayne County and 1,609 more people in the region willing to work in the first eight months of 2016 compared to the prior year. While people either newly joined or returned to the labor market, the unemployment rate remained low at around 5 percent throughout most of the year, except in February and March. In August, the unemployment rate was 5.1 percent in Wayne County and 4.9 percent in the region.

Unemployment rates in Wayne County and the region have been significantly and persistently higher than the Indiana and national unemployment rates since the Great Recession. After a long and shallow recovery, as seen in Figure 3, the unemployment rate gap between our region and the overall state and national unemployment rates has finally closed. These employment trends have been typical for Indiana's rural counties. The overall Indiana unemployment rate more closely tracks U.S. unemployment due to Indianapolis's more diversified economy, its superior performance and more rapid recovery from the recession.

Table 1 shows changes in employment by industry. As of 2016's first quarter, 29,738 people were employed in nonfarm sectors in Wayne County and 57,577 in the region, which resulted in a net change of 158 jobs and 657 jobs, respectively, compared with one year earlier.

For Wayne County, the major job gains appeared in private educational and health services (+63 jobs), professional and business services (+62 jobs), leisure and hospitality (+59 jobs), other services (+56 jobs), and manufacturing (+44 jobs). The major job losses were concentrated in government (-94 jobs), along with smaller losses in information (-12 jobs), trade, transportation and utilities (-9 jobs), financial activities (-7 jobs).

At the regional level, leisure and hospitality (+225 jobs), professional and business services (+211 jobs), manufacturing (+184 jobs), trade, transportation and utilities (+128 jobs), and other services (+86 jobs) contributed the most new jobs in the region. Unfortunately, the region also lost some jobs in private educational and health services...

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