Editor's note
Mike Hannigan has been involved with mortgage financing and property development in Indiana for many years. This week on the Who Gets What? podcast he highlights that experience. Catch it all at mortonjohn.libsym.com.
How is the economy in your county? That’s a question that requires answering two more questions. What’s the economy? And which county is yours?

Is your county the place where you work or the place where you live? Or is it the place where you grew up?

Is the economy the production of goods and services? Or is it the income of the people living in a place?

Here’s a simplstic answer: the economy depends on what we get from working. Not included are some important items we think little about: the money we and our employers pay into government insurance programs (Social Security, Medicare, and such).

Excluded here are earnings by proprietors, as well as dividends, interest and rent often not enjoyed by workers. That’s the net earnings of a county in which people work, and pretty close to take home pay before income tax withholding..

Added are earnings from commuting elsewhere to work and deducted are earnings commuters take out of the county. That leaves us with the net earnings of the workers living in each of Indiana’s 92 counties.

Why is this figure of any importance?

The heart of any economy is what its workers are able to earn. They may work and live there, or they may bring in dollars earned elsewhere. It was once the reason for economic development programs.

Yes, residents of a county may benefit from the dividends, interest and rent they accrue from inheritance or savings. Likewise, they may benefit from Social Security and other government transfer programs.

But maximizing those sources is not the reason we educate children, seek to reduce unemployment, or insist on equity in taxation.

By this measure, in 2012, four counties, (Hamilton, Hendricks, Boone, and LaGrange) were the leaders in Indiana, each with more than 70% of their personal income arising from working. By 2022, Boone County fell out of that elite group as it became a showplace for warehousing with many out-of-county workers..

Least reliant on working in 2012 were the counties of Fayette County (53%), followed a quartet at 55% (Wabash, Blackford, Crawford and Grant). By 2022, Wabash and Fayette fell below 50% while the quartet just named, also declined in their reliance on work for income.

What should be done about making working more important to our county economies? The state’s past economic gurus said, “We need highly educated people to occupy highly paid jobs.” It’s an old horse and wagon issue. What we might find faster are better paying jobs for Hoosiers of all education levels.

We are concerned about what we call “rural” counties, but many such counties have well-developed, long-neglected cities. Fayette, Grant and Wabash are a few deserving to be hubs of new jobs that will raise incomes of workers throughout their regions.
Morton J. Marcus is an economist formerly with the Kelley School of Business at Indiana University. His column appears in Indiana newspapers, and his views can be followed his podcast.

© 2024 Morton J. Marcus

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