Study: Employment Shift Requires New Policies

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Ball State Economist Mike Hicks co-authored the report. Ball State Economist Mike Hicks co-authored the report.

A report from Ball State University suggests state, regional and local governments, as well as private sector throughout the state, should consider a revision of economic development policies. The report says a dramatic change in the employment mix in Indiana warrants a new look at these policies in order for economies to thrive.

The report, "Footloose Jobs & Urbanization: Recent History and Policy Considerations for Indiana," was co-authored by Michael Hicks, director of the Ball State Center for Business and Economic Research, and David Terrell, director of the Ball State Indiana Communities Initiative. It features data from 2001 to 2014.

The study says, since 2000, has lost more than 150,000 footloose jobs, but has gained more than 350,000 non-footloose jobs. Footloose jobs are described as those in companies which can locate anywhere, as opposed to non-footloose jobs, which are population dependent.

The authors also say employment growth has only been seen in larger urban counties, whereas rural and medium-sized towns have seen significant job losses. The report shows the manufacturing sector has seen gains in productivity, which has cut the need for workers.

"In Indiana, which is relatively emblematic of the nation, only counties with more than 250,000 residents have seen net employment growth over the past generation," said Hicks. "Despite these stark data, Indiana, like many other states, spends the bulk of its economic development resources on supporting and/or attracting footloose jobs. These facts compel a major re-evaluation of public policy."

The study suggests cities and towns throughout Indiana should "aggressively review" their local economic prospects by focusing on ways to attract households. It says local governments have become overly reliant on tax incentives that negatively affect schools and municipal government.

The report also says all parts of Indiana should be represented by regional economic development organizations and private sector leaders should play a more active role in economic development.

You can read the full report below:

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