The Northwest Indiana economy recovered from the recession with robust earnings and sales, but it might be difficult to convince your average working person of that.
Economists at Valparaiso University on Monday unveiled data showing the sum total of the region's output increased 13.3 percent to $33.2 billion in three years time, but employment in the region remains at recession levels.
"Everyone was surprised when we saw that," said Paul McCrath, a professor of economics at Purdue University Calumet. "That really was an eye opener."
McCrath, three other economists and a labor specialist discussed the findings of the initiative called "Northwest Indiana: Regional Economic Trends and Opportunities" before an audience of about 170 at the university's Harre Union. A team of five economists developed the data during the last year and a half.
The robust growth in Northwest Indiana's economy was confirmed by several indicators, including an 11 percent increase in productive capacity and a 4.9 percent rise in private sector sales.
The average value per employee added to products and services produced here has jumped 19 percent to $53,416 per employee since the recession, according to the data released Monday.
However, when it came to employment, there are actually about 6,700 less people working in the region than during the recession. The percentage of adults employed or seeking employment actually dropped from 56.8 percent of the population during the recession to 56 percent now.
The average compensation per job, a figure that includes the value of employer-provided benefits, has remained stagnant at just above $48,200.
The panelists and much of their audience spent much of the event Monday dealing with what must be done to fix the discrepancy between rising output and falling employment. They agreed this doesn't have to be the new normal.
"The best way to keep people employed, or to keep them from being unemployed, is to get them some kind of education or certification," said Robyn Minton, of The Center of Workforce Innovations, which oversees WorkOne employment centers in the region.
"We can't entice firms to come in here because we just don't have the workforce right now," said Tony Sindone, a continuing lecturer in economics at Purdue University North-Central.
In the last two years, the region's success in drawing new companies has revolved around its mainstays of manufacturing and transportation. Those include a Canadian National Railway expansion of Kirk Yard, in Gary; expanded services and facilities at Gibson Yard, in Gary; the move of manufacturer Modern Forge to Merrrillville, from Blue Island, Ill.; and the new plant of solar component maker Fronius in Portage.
Another reason for the discrepancy between output and employment lies in the continuing gains in productivity that are being made by American manufacturers, McGrath said.
Steel and other products can be produced in the same volumes as before but with far fewer workers, due to the implementation of computer-controlled systems and other productivity enhancements.
"Your muscle doesn't do you much good in a steel mill anymore," McGrath said. "But your brain does."
The last data release by Northwest Indiana: Regional Trends and Opportunities, was done 1 1/2 years ago at a similar event at Valparaiso University. The initiative is coordinated by the Northwest Indiana Forum.