As a result, manufacturing as a share of total nonfarm employment has continued to decline (see Figure 1). Since September 2000, Evansville’s manufacturing workforce has fallen 25.2 percent or about 9,400 workers. Given Evansville’s dependence on manufacturing, the metro has been noticeably impacted since the inception of the current recession. Consequently, personal income and output growth in the next year will be below levels of the past five years. Given the proportion of output that is sold outside the metro area, the rebound will not begin until the broader economy strengthens and demand for locally produced goods returns to the level of the preceding five years. In 2010, the Evansville metro economy will benefit from an announced $26 million investment by Mead Johnson Nutritionals to build its new Research and Development Technology Center as well as the stimulative impacts associated with the nearly $21 million expansion by Berry Plastics. In-migration, which has boosted local population growth in recent years, was not evident in 2009 as the widespread nature of the national recession has limited residents’ mobility. Recent announcements from Whirlpool Corporation about the closure of its Evansville manufacturing facility in 2010 and the decision to keep its product development unit in Evansville underscore both the challenges and opportunities for the Evansville economy in the future. These include workforce reductions announced by a plastics firm, automotive parts manufacturers, and a financial services firm. The national downturn and weaknesses in credit markets negatively impacted a number of the metro area’s largest employers. Between 20, single-family housing permits are estimated to have dropped by 57 percent and personal bankruptcies per 1,000 persons are estimated to have increased from 5.1 to 8.9. Existing home prices declined from an average of $94,000 in 2008 to $89,000 in 2009, and mortgage originations are estimated to increase from $715 million in 2008 to $761 million in 2009. Homeowners experienced some home price depreciation, but the median home price has not dipped by as much as it has nationally. economy in 2009, there were indications of a slowly improving housing market, some deterioration of credit quality, and higher delinquency rates. The manufacturing sector continues to be an important base to metro area household incomes and consumer spending activity even as the economy adjusts to an ongoing diversification away from manufacturing-industry dependence.Īs the Evansville economy tracked the U.S. In 2009, nominal personal income is estimated to decrease by 3.1 percent and real gross metro product is estimated to decrease by 3.8 percent.
Employment increases were evident only in the hospitality and government sectors. Traditional recession-resistant sectors such as health care and education were also adversely affected. The dynamics of the Evansville area labor market underscore this with a drop in the non-seasonally adjusted unemployment rate from 8.6 percent in January 2009 to 7.6 percent in September 2009, compared with a rise in the national unemployment rate from 7.6 percent to 9.8 percent over the same time period.Įconomic performance in 2009 was driven by job losses in key sectors such as manufacturing, construction, and financial services. While the declines in output, employment, real income, and real retail sales intensified in 2009, the depth of these impacts are less pronounced in Evansville than in many other metro areas of similar size and structure. The recession that began at the end of 2007 is no exception. Professor of Economics and Dean of Business, College of Business, University of Southern Indianaĭuring every recession over the past five decades, the Evansville metro economy has exhibited resiliency and a capacity to withstand the adverse impacts associated with national recessions.
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