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September 1, 2013

HOWEY: Jobs problem may be local, not state

After 16 consecutive months of Indiana’s jobless rate above the national average — it’s 8.4 percent now, compared to 7.4 for the U.S. — the cold reality is that we have a problem with a quarter of a million Hoosiers chronically out of work.

Then came a Ball State University study showing Indiana’s per capita income has slipped from 30th in the nation to 40th with dozens of counties wallowing in wage levels in the 1990s and, some like my old home of Miami, in the 1970s range.

I wrote an analysis in which I noted that for almost the past nine years, we’ve had Republican governors who have made job creation and education reform top priorities, and yet we’ve been over 8 percent unemployment since early 2009.

At some point, a political reality comes into play, perhaps as early as 2014 and if this trend persists, by 2016. It used to be that a jobless rate over 7 percent would mean the boot from voters. Yet, Gov. Mitch Daniels left office with a 60 percent approval rating and President Obama was reelected.

Gov. Mike Pence gets it. Speaking before the Indianapolis Kiwanis last Friday, he acknowledged, “There’s a great sense of optimism, there’s reason to be encouraged as Hoosiers, but this is a difficult time for too many in our state.”

At Hobart, Pence told local Realtors, “I want to see where the young people can graduate from high school and can have an industry certification or even an associates degree right that day.”

There was one interesting response to my analysis, and it came from Ball State University economics Prof. Michael Hicks. “Indiana’s problem is not that the overall business climate for investment is poor [it is great] or that we have too few students graduating from college with the right degrees [they are] or that people outside Indiana don’t know how great these things are [they know],” he explained. “The problem is not statewide [we have 12 counties growing much faster than the nation as a whole]. These are just facts. I also don’t believe that the overall problem is one of rapid technological progress or any of the national [and hopefully transient] problems in labor markets.”

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