Figures released Friday, May 16, show Elkhart County unemployment at 5 percent in April.
Imagine — 5 percent. We haven’t seen a number that low since February 2007.
But we cannot afford to spend much time celebrating. Because in many ways, we’re still relying on the same economy that peaked at 20.2 percent unemployment in March 2009.
The RV and boat industries fueled our spectacular recovery from the Great Recession. Our workforce grew to 95,326 in April, its largest total since October 2000. More people drew paychecks last month — 90,544 — than any time in the past 13 years.
And, while April statistics showed 4,782 people unemployed, that’s the lowest total since July 2003.
We’ve come a long way since the recession. But we need to recall what we learned just last month, when Dorinda Heiden-Guss spoke at the Greater Elkhart Chamber of Commerce’s annual economic development luncheon.
Heiden-Guss, president and CEO of the Economic Development Corp. of Elkhart County, pointed out that the county’s per capita income plunged from 101 percent of the U.S. average in 1970 to 78 percent in 2012.
STATS Indiana reported Elkhart County per capita income at $35,550 — just 93.3 percent of the state’s $38,119 average. Indiana, in turn, ranked 39th nationally in 2012 per capita income.
So, while the local economy expanded fast enough to reduce unemployment by 15.2 percent in five years, it remains vulnerable. Chris Steele, CEO of Investment Consultant Associates, showed just how vulnerable we’ve become to downturns in the transportation industry.
A location quotient measures how much of a workforce does a specific kind of job. If an area scores more than 1 on the LQ, that demonstrates strength. When a location quotient hits 4, it indicates a risk of over-concentration on an industry.
Elkhart County’s LQ for transportation equipment: 19.
"We're not talking about high-tech or advanced manufacturing,” Steele told the chamber at its economic development luncheon. “We're talking about light assembly, things that tend to be a little bit lower on the wage and skills base, and are particularly susceptible to downturns in the national economy. You in this room need to be able to lead the efforts toward diversification.”
The Economic Development Corp. hired Steele’s Boston-based company in 2013 to help the county diversify its economy. Based on his advice, Heiden-Guss said the EDC is no longer pursuing light-assembly manufacturers paying less than $20 an hour.
Steele suggests targeting a new set of industries, including financial and professional services, agricultural and food processing, automotive machining.
Heiden-Guss said the EDC board understands what’s at stake. “It’s no longer business as usual,” she said in April.
That goes for all of us.
A vibrant community shapes its own future. If a diverse economy is important to us, that’s what we’ll build; if we value a thriving middle class, that’s what we’ll create.
And when we do, we’ll no longer need to live in fear of 20 percent unemployment.