Center for Business and Economic Research - Ball State University


CBER Data Center
Projects and PublicationsEconomic IndicatorsWeekly CommentaryCommunity Asset InventoryManufacturing Scorecard

About

Commentaries are published weekly and distributed through the Indianapolis Business Journal and many other print and online publications. Disclaimer

RSS Feed

Disclaimer

The views expressed in these commentaries do not reflect those of Ball State University or the Center for Business and Economic Research.

Recent

Previewing the Long-Term Effects of TariffsThe dominant effect of the Trump tariffs will be to raise production costs on almost every American manufacturing firm.

It’s TDS to Suppose These Tariffs Are WorkingTrump has pushed the U.S. into an economic downturn that will be especially hurtful to Hoosiers.

Trump’s Tariff Recession Is HereMy new forecast, completed in late April, predicts a national recession began as early as March in reaction to Trump’s tarriffs.

Two Key Economic Lessons in One BillHoosiers face trade-offs and opportunity costs in the wake of SEA1.

View archives

Top Tags

jobs and employment 262
economics 203
state and local government 188
education 186
indiana 173
economic development 171
taxes 146
budget and spending 145
law and public policy 144
workforce and human capital 139
Browse all tags
Reporter / Admin Login

November 7, 2011

The Skinny on Community Growth

I am fortunate that one or more times a week I am invited to speak at different places around the state.   This is a great gift because I learn so much from the questions and interests of various groups.  One question that looms over every talk is, “What can we do to increase the number of jobs in our community?”

There are surprisingly easy yet few answers to this question.  First I say, make sure you don’t get annexed by Illinois or Michigan.  Living in a state with a solid fiscal environment and tractably small public debt is a great boon in these times.  I am quick to point out, however, that these times won’t last, and that even now, the quality of the workforce—or human capital, in economics jargon—matters more than anything else in the long haul of economic development.  For many communities this is disagreeable news.

This recession is poignantly amplifying the cost of a skills gap in a community.  The places the highest and longest unemployment rates are those with an excess of unskilled workers.  School performance in these communities is a double-edged sword.  Skilled and mobile workers choose places with top-notch schools.  In turn, top-notch schools prepare skilled workers.  More than a third of Indiana’s schools perform badly enough to crush the economic prospects of their communities.  The Indiana Department of Education has a wonderful tool for assessing schools based on their achievement and growth.   It is the most important indicator of economic development in a community.

If you live in a school district that is below average in achievement and below average in achievement growth, you had better get angry.  If the school does not improve in two or three years, vote with your feet and move.  If you stay, expect the value of your home to decline and the local economy to shrink.  But, more than schools matter. 

A well-run local government that makes an investment in the quality of a community is nearly as important.  Two communities stand out.  The palpable success of R and D mayors in Muncie and Kokomo respectively demonstrate that it isn’t a political party, but a policy that turns communities around.  What makes these communities different is a conscious decision to invest in things that make the city more livable and attractive.  This is a big change in both places, where a half decade ago local governments existed mostly to secure jobs for public employees.  That model failed spectacularly.  But even in successful Kokomo and Muncie, much is left to do.  It will take a full generation of investment to turn these communities into places that will comfortably grow and prosper.  

These are often uncomfortable answers to the jobs question.  It is far easier to offer a tax incentive or launch a marketing campaign, but these things don’t work by themselves.  Fixing schools, paving roads, building sidewalks, sprucing up parks and cutting government waste are hard, long, inelegant and thankless tasks—but are the ones that really matter.

Link to this commentary: https://commentaries.cberdata.org/595/the-skinny-on-community-growth

Tags: education, jobs and employment, recession


About the Author

Michael Hicks cberdirector@bsu.edu

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Note: The views expressed here are solely those of the author, and do not represent those of funders, associations, any entity of Ball State University, or its governing body.

© Center for Business and Economic Research, Ball State University

About Ball State CBER Data Center

Ball State CBER Data Center is one-stop shop for economic data including demographics, education, health, and social capital. Our easy-to-use, visual web tools offer data collection and analysis for grant writers, economic developers, policy makers, and the general public.

Ball State CBER Data Center (cberdata.org) is a product of the Center for Business and Economic Research at Ball State University. CBER's mission is to conduct relevant and timely public policy research on a wide range of economic issues affecting the state and nation. Learn more.

Terms of Service

Center for Business and Economic Research

Ball State University • Whitinger Business Building, room 149
2000 W. University Ave.
Muncie, IN 47306-0360
Phone:
765-285-5926
Email:
cber@bsu.edu
Website:
www.bsu.edu/cber
Facebook:
www.facebook.com/BallStateCBER
Twitter:
www.twitter.com/BallStateCBER
Close