Two pockets of northern Indiana sit less than 50 miles apart yet represent opposite economic trends: Over the last year, the Elkhart metro area saw the country’s largest percentage gain in employment, while greater Michigan City ranked second in job losses.
Jobs around Elkhart grew by 5.3 percent from November 2016 to November 2017 and shrank by 3.6 percent in greater Michigan City, according to new data from the Bureau of Labor Statistics.
The numbers reveal that inequality persists at a time when the country's unemployment keeps falling — even among neighbors.
Not that the Michigan City-La Porte region, as defined by the BLS, is suffering — the unemployment rate is 4.2 percent, barely higher than the national rate of 4.1 percent. But the area is losing more workers than it’s hiring, making it an anomaly at a time of steady job growth.
Part of what's driving this trend is common in areas outside big cities: The population has stayed flat for two decades. La Porte County has inched up from 110,000 in 1998 to nearly 111,000 today. Meanwhile, the population is slowly aging. (The median age is 40, higher than the nation's 38.)
Economists say labor shortages can stall business growth and reduce productivity. Fewer people with disposable income can also lead to less spending, which takes a toll on local shops and restaurants.
Not enough young people are moving to the Michigan City area to replace the workers retiring from its major employers, which include a casino, two hospitals and a corrections department. That shaves numbers off the region's employment total, too.
“There’s not much population growth, and that’s one of our issues,” said Clarence Hulse, executive Director at Economic Development Corporation Michigan City. “We’re working to attract more people to the community.”
Professional and business services jobs — a broad range of positions, from secretaries to accountants to top managers — have fallen in the area by 13.8 percent, from 2,900 to 2,500 over the last year, the BLS data found. Government jobs, including public teachers, have also dropped by 7.4 percent.
That's partly because of budget cuts and dwindling school enrollment, another consequence of population stagnation, Hulse said
Over in Elkhart County, Mark Dobson, president of the area’s Economic Development Corporation, said one factor sets the area apart from other mid-sized U.S. cities: It's the nation's capital of recreational vehicle (RV) manufacturing.
“It’s booming, and it’s a sustainable boom,” he said. “Three years of record sales industry-wide.”
RV purchases are tied to consumer confidence. During the last recession, when much of the disposable income for RVs vanished, Elkhart’s unemployment rate surged to a stunning 22 percent. It has since dipped to one of the lowest in the country (2.5 percent).
Continued growth, however, depends on hiring more workers. Roughly 10,000 jobs remain vacant in Elkhart, mostly within the RV industry and its supply chain.
“The market is growing faster than our population is growing,” Dobson said. “The need for workforce — there’s a gap there right now.”
By most measures, economists say the United States is in great shape. The economy has added jobs every month for more than seven years. The stock market keeps breaking records.
Still, as 313 metro areas in the U.S. grew last year, 70 faced decreases. The largest over-the-year drop in employment happened in Cape Girardeau, located on the border between Missouri and Illinois (5.6 percent), followed by Cleveland, Tenn. (3.6), and the Michigan City, Ind., area.
The areas that lost jobs shed mostly service positions: retail, hospitality, food and government.
“The country's top line figures are good, but when you delve into it, there’s a lot of inequality,” said Kate Bahn, an economist at the Center for American Progress, a left-leaning think tank in the District. “Some places are booming, and some places are declining.”
The areas breaking from the larger pattern of job growth tend to be in Upstate New York, the Midwest and West Virginia, she said — mostly in smaller cities. Women and minorities, meanwhile, continue to lag behind white men by just about every metric nationwide: wages, leadership roles, labor force participation.
“We can only get so far with a tight labor market unless we’re addressing these things,” Bahn said.
Jed Kolko, chief economist at Indeed, said it’s hard to say what the 70 metro areas that lost jobs in the U.S. over the last year have in common.
Many are far from urban centers, where jobs are growing most quickly. Employers in suburbs, by contrast, can more easily find workers to fill jobs in manufacturing, construction, and the service sector.
“It’s a lot about where workers want to be,” he said.