COMMENTARY: As state, nation rebound from recession, Vigo among counties lagging in growth

For most, the Great Recession is fading in the rear-view mirror. Vigo County remains calf-deep in it and is still slowly slogging its way out of that swamp toward the shoreline.

Eighty-six Indiana counties have returned to pre-recession levels in at least one of four “economic performance indicators” — economic output (gross domestic product), jobs growth, unemployment rate and median home prices. Seven have “fully recovered” in all four categories. Six haven’t reached pre-recession status in any of the four — Vigo, neighboring Vermillion, Delaware, Franklin, Madison and Tipton counties, according to a National Association of Counties’ report, “County Economies 2015: Opportunities and Challenges,” released this month.

The annual study illustrates the unevenness of the recovery across America. Sixteen percent of the 3,069 counties in the U.S. languish in the same predicament as Vigo. The “recovery” looks different to people in those places. “They don’t feel it in their pocketbooks,” researcher Emilia Istrate said by phone Tuesday. Istrate serves as director of research and outreach for the National Association of Counties (or NACO).

An hour’s drive east of Vigo County on Interstate 70 lies Indianapolis rim counties whose economies have recovered in all but one category. An hour south of Vigo stands fellow Wabash River county, Gibson, where its economy has fully recovered.

“Every county has had its own recession and recovery period,” Brian Namey, NACO director of public affairs, said Tuesday.

Here, the uphill climb back to life-before-the-recession plateaus continues, across the board, according to NACO research dating back to 2002.

• Vigo’s unemployment rate peaked above 11 percent in 2010 and has dwindled since. It fell to 6.5 percent in 2015, but still lingers above the local pre-recession level of 5 percent.

• The county’s rate of jobs growth bottomed out in 2013, and has slowly begun to recover. Yet, last year, Vigo’s jobs growth rate stood at 94 percent of its 2002 level.

• The growth of Vigo’s economic output, or productivity, peaked in 2007, plunged as the recession set in, leveled off from 2012 to 2014, then rose by 3.4 percent last year. Nonetheless, it remains well below that 2007 level and far beneath the average for similar mid-sized U.S. counties.

• Median home prices in Vigo County spiked in 2006, dropped through the recession, then rose in 2013, approaching 2006 levels. But median home prices fell again by 1 percent from 2014 to 2015.

Not surprisingly, wages haven’t grown either. The growth rate in Vigo Countians’ average pay — adjusted by NACO to reflect the cost-of-living differences between counties — was zero from 2013 to 2014, the most recent year available. Average wages locally declined from 2009 to 2014, as did productivity.

Though Indiana’s governor and leaders were “celebrating” the state’s lowest unemployment rate in a decade and 10,000 new jobs, many Hoosiers aren’t enjoying full prosperity. In terms of full recovery, less than half of Indiana counties are back to pre-recession levels in economic output, and only a fourth of the counties have regained their previous number of jobs. Yet, nearly all fare better than Vigo.

To be sure, the city of Terre Haute’s lingering general-fund budget deficit doesn’t bolster the community’s economy. This transcends that problem. The NACO report reveals a far broader economic malaise here. It clarifies the need for smart, continual, get-the-biggest-bang-for-the-buck economic development measures. A mayor can’t fix it alone, nor can a city council or county commission.

“Economic development is not a single-player game,” Istrate said. “Not a single player can pull an economy out.”

To revitalize, counties not only need all of the local government units and community planners, but also an active interest from their state and federal government representatives. “The big message for [NACO] is for the federal and state governments not to forget to work with the locals on the ground to help with economic recovery,” Istrate said.

An example of such interaction emerged with the current Hulman Center renovation and expansion proposal. That $75-million project received a commitment of $37.5 million from the state Legislature, thanks to efforts by state Rep. Bob Heaton and other local backers. The community must raise the other half through a coalition of the city, county, Terre Haute Convention and Visitors Bureau and Indiana State University. That opportunity should be utilized, with the budget-troubled city’s portion cautiously outlined.

The Indiana Regional Cities Initiative offered $42 million to metro sectors, and aimed to get cities to team up with nearby small towns and rural communities to develop locally distinct amenities that attract new businesses and residents. The Wabash River Region proposal — involving Vigo, Sullivan and Knox counties — lost out to more expansive plans by Fort Wayne, Evansville and South Bend. Still, Vigo and its adjoining Wabash River communities should continue broadening and fine-tuning the local proposal, and push the Legislature to continue the Regional Cities investments.

Roads, bridges and infrastructure, schools, colleges and workforce training programs also benefit from strong local-state-federal cooperation. While Vigo and the other five still-in-recovery Indiana counties receive state and federal funds for such necessities, those locales and similar ones across the country face a “triple threat.” NACO says that threat involves “uncertainty around federal policy, from tax reform and from entitlement reform and appropriation cuts not accompanied by reductions in unfunded mandates.”

In the upcoming Indiana primary (on May 3) and 2016 general election (Nov. 8), candidates running for county, state and national offices will want Vigo Countians’ votes. When they say, “I’m all about jobs. Jobs, jobs, jobs,” ask for details. Question how they plan to work with other levels of government and various entities to bring growth in jobs and wages not just to Indiana or the Midwest, but Vigo and its neighboring counties. If they imply that benefits from projects elsewhere will trickle down to this place, ask them what that will look like to the average Hautean.

“Americans don’t live on this abstract macroeconomic level,” Istrate said. “Americans live in a place like these counties.”