Economic Update | Has the Soft Landing Come and Gone?

submitted by
Uric Dufrene, Ph.D.,  Sanders Chair in Business, Indiana University Southeast

The monthly national jobs report released showed another big gain in job creation.  The Bureau of Labor Statistics report showed that the nation’s economy gained another 275,000 jobs during February,  much higher than consensus estimates of 200,000. Revisions from the prior two months did show that payrolls were reduced by a combined 167,000, pointing to some softness in previous strong reports. While the overall report was favorable, looking beyond the headline numbers can find potential clues on the overall trajectory of the economy. 

While the headline 275,000 jobs number from the survey of establishments was favorable, numbers from the household survey pointed to potential concerns about the economic outlook. Employment declined by 184,000, and this marks another consecutive decline since November 2023. Since November 2023, employment has declined by nearly 900,000. The decline in employment showed up in the uptick in the nation’s unemployment rate, from 3.7% to 3.9%. The increase in the unemployment rate was due to an increase in unemployed workers of 334,000. Since the same time last year, the number of unemployed workers has increased by close to 500,000.     

Examining unemployment rates by occupation might also offer signs about the economy. The unemployment rate data by occupation is non-seasonally adjusted. So, we need to examine the year-over-year change in the unemployment rate to ascertain any relevant information about potential trends. One occupation with signaling potential is sales and related occupations, with the unemployment rate usually undergoing a noticeable change prior to and during a recession. Simply speaking, employers need more sales-related occupations when an increase in sales is anticipated and need fewer on the converse. The unemployment rate for sales-related occupations increased from 4% of February last year to 4.7% in February 2024. In the tech-led recession of 2001, the unemployment rate for sales occupations increased from 3.3% to 4.9% just prior to the recession’s start. The Great Recession did not see any declines in sales-related occupations until the actual start of the recession, with the unemployment rate increasing from 5.2% to almost 9% by the end of the recession.  While the current change is a noticeable uptick, we need to see sustained increases for definitive conclusions on growth projections and more conclusive statements on any pending recession.

One industry that can provide potential hints on the economic trajectory is professional and business services, specifically temporary employment services.  As the economy heats up, employers will first expand with temporary labor. To the contrary, when employers are anticipating or experiencing declines in economic activity, temporary workers are usually the first to experience layoffs. Temporary labor services are part of the professional and business services sector, and the unemployment rate has increased from 4.2% to 5.1%.  Just as recently as October 2023, the unemployment rate in professional and business services was 3.2%.  Additionally, the February jobs report did show a decline in temporary labor services of 15,400. As a comparison, the 2001 recession saw the unemployment rate in professional and business services increase from 4.1% to 5.9% just prior to the economic slowdown. For the Great Recession, professional and business services saw an increase in unemployment from 4.8% to 6.4%. There has been a noticeable increase in unemployment, but still not the kind of changes that might coincide with a recession. This is another number that warrants watching. 

My economic outlook for 2024 called for “slower growth” and a pullback in consumer spending. We are seeing emerging signs of softer growth along with consumer spending, but we are not close to calling for a recession. Over the next several months, we will hear more talk about various forms of stagflation, a combination of higher prices and slower growth. As the inflation rate approaches the Federal Reserve’s desired level of 2%, getting from 3 plus percent down to 2% is facing headwinds, implying that interest rates will be higher for longer.  The soft landing may have come and gone as the  “last mile” of inflation remains stubborn, and signs of softer growth emerge. 

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Advocacy Update | 03.13.24

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The 2024 Legislative Session is officially over! If you want to see our earlier Advocacy updates, please click here. As a reminder, this year’s Call to Action continues the conversation with talent attraction and retention, focusing mainly on housing development, availability and affordability of childcare and eldercare, incumbent worker training options, employability of people with disabilities, and eliminating worker shortages.

New this Week:

HB-1183 passed and was signed by the President of the Senate on 3/12/2024. This bill will have an impact on economic development projects for our region, but we as 1si are still learning about what that impact will be. The Advocacy Leadership group will continue to monitor the bill and will provide an update once more information is received by the State.

SB-2 passed and was signed by the President of the Senate on 3/12/2024. The childcare bill makes it easier for childcare workers to find subsidized care for their children and makes families whose income is lower than the state’s median eligible for childcare vouchers and programs. The bill also requires a compensation study done on early childhood educators and caregivers for out-of-school programs and make that data available for review. Click here to read the most up-to-date version of SB-2.

Bills 1si is Monitoring:

  • HB-1121 – Local Income Taxes
    • Passed and was signed by the President of the Senate on 3/12/2024.
  • HB-1183 – Foreign Ownership of Agricultural Land
    • Passed and was signed by the President of the Senate on 3/12/2024.
  • HB-1199 – Repeal of Economic Enhancement District Law
    • Passed and was signed by the President of the Senate on 3/12/2024.

Current List of Bills 1si Supports or Opposes:

Supports: SB-2 – Child care

  • Passed and was signed by the President of the Senate on 3/12/2024.

Thank you for following along with us on this session. If you’d like more information on our 2024 Advocacy Agenda, or to download a copy of it, please visit www.1si.org/advocacy or download a PDF copy here.

Purdue Opens 2024 Digital Ready Businesses Program

WEST LAFAYETTE, Ind. – A Purdue Extension workshop series that seeks to help Indiana small businesses build or enhance their online presence will return in communities throughout the state this spring.

“Digital Ready Businesses” was launched in 2017. The program has been updated and new workshops added to reflect current trends. Participants can attend all 11 (1 hour) sessions or only those that meet their needs. The hands-on training, led by county Extension educators, covers a variety of topics, from website basics to podcasting, blogging, the ins and outs of social media, and email analytics and marketing. 

The series is being offered virtually starting in January from 2pm-3pm EST:

  1. Claim Your Online Turf – Tuesday, April 2
  2. Website Basics – Thursday, April 4
  3. Grow Your Virtual Customers – Tuesday, April 9
  4. Search Engine Optimization – Thursday, April 11
  5. Email Analytics & Marketing – Tuesday, April 16
  6. Podcasting 101 – Thursday, April 18
  7. How to Blog Successfully – Tuesday April 23
  8. Introduction to Social Media Platforms – Thursday, April 25
  9. Social Media Plan & Content – Tuesday, April 30
  10. Social Media Analytics & Marketing – Thursday, May 2
  11. Digital Storefront – Tuesday April 7

Sessions are $25 each or you can register for the complete series for $250.

“These workshops are designed for entrepreneurs and small business owners or employees who might not have an online presence, or have one that is outdated,” says Roberto Gallardo, director of the Purdue Center for Regional Development and Community and a regional economic specialist for Purdue Extension.

In follow-up surveys, participants have reported significant increases in sales, customer base and customer engagement, and nearly 9 in 10 recommended the series to others.

“We have a long way to go,” one participant responded, “but at least we now have a plan. Since our workshop I started concentrating on Facebook and Instagram with the help of my daughter. She started to post daily even though our content/backdrop was not exactly how we wanted it. We grew Facebook from 1,547 to 2,079 and Instagram from 676 to 2,013.”

For more information, email Daniel Walker at walke422@purdue.edu

Click the link for an informational flyer: Digital Ready Businesses 2.0 flyer March

Writer: Charles Wineland, 765-494-6946, cwinelan@purdue.edu

Source: Daniel Walker, 765-215-1534 walke422@purdue.edu

Nonprofit Spotlight | Family & Children’s Place

Family & Children’s Place
1 Quartermaster Ct.
Jeffersonville, IN 47130
Business Phone: 502-893-3900
Website:  www.famchildplace.org

Contact Person: Kristen Millwood, Director of Development
Contact Email:  kmillwood@famchildplace.org                                    

Agency Mission Statement or Description:
Our mission: We protect and heal children and families.  Our vision is happy, healthy children and families…freed from abuse.  Family & Children’s Place guides families through life’s challenges school-based, mental health counseling, and child advocacy services. We provide resources that build skills for children, families, and communities to use now and for generations to come.  

Year established: 1883.  We are 140 years old this September!

Counties/regions serviced: Clark, Floyd, Scott, Harrison, Washington, Jackson

Focus areas:  

  • Child Advocacy Centers: Comprehensive, child-friendly, treatment and evaluation centers for abused children providing families with compassionate, coordinated intervention and investigation of child abuse.
  • Counseling Services: individual, family, group, and school-based services using evidence-based, proven interventions for children and families who have experienced trauma.
  • School-Based Services (SBS): family-centered out-of-school-time programs designed to improve academic success and strengthen families, build character and social competency, and bolster relationships between the student, family, and school.

Impact on community:
We are the region’s leading organization serving children and families impacted by abuse, neglect, and community violence. We provide services in a 17-county region encompassing Southern Indiana and Louisville, KY. When the unthinkable occurs, Family and Children’s Place provides a refuge that allows children to heal in a supportive environment and our team is with families every step of the way.  We also promote initiatives to bring child abuse prevention to the broader cultural conversation to create healthier communities. Our School-based services promote regular engagement and participation, improved social and life skills and improved academic performance. 

Volunteer Opportunities: Family & Children’s Place offers several different types of volunteer opportunities for those looking to help us better our community.  This includes administrative volunteers, event volunteers and program volunteers.

How 1si members can help your organization: Report abuse if you suspect it.  In Indiana call 1-800-800-5556.  Refer people who may need our services: 502-893-3900. Advocate by sharing our social media – we’re at /famchildplace on Facebook, LinkedIn and Instagram and Twitter.  Work for us!  We have several positions open.  And last but not least, give, if you can: www.famchildplace.org.

 

Charging Up: Global Technology and Engineering Provider Coming to Southern Indiana

MKS Global, an ISO 2013-certified company, is opening operations in Jeffersonville.

Jeffersonville, IN. (March 4, 2024)

MKS Global, Inc., is expanding! The global technology and engineering provider will move to a new location to grow its production capacity, including new production with aerospace maintenance technology and electric charging stations. The company will invest over $2.8 million into the region by leasing a building on Centennial Boulevard in Jeffersonville and purchasing new equipment. The location will also add up to 40 new jobs at an average wage of over $45.00 per hour, with the company providing training for each employee. The new facility will also serve as the company’s headquarters for the U.S.  

MKS Global, Inc., is a global technology partner with a full spectrum of IT, digital technology and engineering services with supply chain resources that support a variety of industries, including health care, information services, aerospace, automotive, and other technology manufacturing. With a focus on providing services that enable businesses to reach their goals, MKS Global has a 98% referral rating and a presence in six countries.

“Our team couldn’t be more optimistic about the future as we establish Jeffersonville, IN, as our headquarters and newest facility for MKS Global,” said CEO William Moon. “This new location affords us an abundance of growth opportunities by dramatically expanding internal prototyping capabilities. This investment will accelerate innovative product partnerships in a variety of high-impact industry sectors such as automotive, aerospace, renewable energy, and beyond.”

Based on the company’s job creation plans, the Indiana Economic Development Corporation (IEDC) committed an investment in MKS Vision Group, Inc. of up to $800,000 in the form of incentive-based tax credits. These tax credits are performance-based, meaning the company is eligible to claim incentives once Hoosiers are hired.

“Southeast Indiana is quickly growing its reputation as a premier destination for technology providers and technology-enabled firms thanks to the investment of companies like MKS Vision Group,” said Ann Lathrop, chief strategy officer at the IEDC. “As a state, we are committed to supporting this expanding ecosystem through our partnerships with regional leaders and through strategic investments in innovation, community development and talent, paving the way for continued economic growth and career opportunities for years to come.”

“The City of Jeffersonville enthusiastically welcomes MKS Global to our growing community of innovative technology-driven companies,” said Jeffersonville Mayor Mike Moore. “This facility will include a state-of-the-art prototyping center, supporting a number of high-growth industries and creating 40 new jobs with an average wage above $45 per hour which is nearly double the Clark County average wage.”

“MKS Global’s investment further recognizes the regional advantage we offer to industry partners,” said John Launius, Vice President and Director of Economic Development at One Southern Indiana. “We are confident MKS Global will find continued success by offering premium product design and engineering services, now leveraged with increased prototyping capabilities which make them an ideal industry partner.”

About MKS Global, Inc.

MKS Global is a solutions company, combining global network engineering, digital technology, and supply chain expertise with a focused partnership experience. They exist to provide increased efficiencies and flexibility that accelerate business performance by adapting the latest cutting-edge technologies for their customers. Their services deliver tangible benefits with efficiency and agility. For more information, visit www.mksglobal.com.

About One Southern Indiana
One Southern Indiana (1si) was formed in July of 2006 as the economic development organization and chamber of commerce serving Clark and Floyd counties. 1si’s mission is to help businesses innovate and thrive in the Southern Indiana / Louisville metro area via the three pillars of Business Resources, Economic Development, and Advocacy. For more information on One Southern Indiana, visit www.1si.org.

Contact:

MKS Global, Inc.
Andrew Brinker, General Manager
Andrew.brinker@mksglobal.com
810-434-0820

One Southern Indiana
Brittany Schmidt, Content Marketing and Media Relations Manager
BrittanyS@1si.org
812-945-0266

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Advocacy Update | 03.07.24

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We’re almost to the end of this session! If you want to see our earlier Advocacy updates, please click here.

As a reminder, this year’s Call to Action continued the conversation with talent attraction and retention, focusing mainly on housing development, availability and affordability of childcare and eldercare, incumbent worker training options, employability of people with disabilities, and eliminating worker shortages.

New this Week:

Bills continue to move throughout the Senate and House this week, as both are on their third readings for bills that are still active.

Two bills that 1si has been monitoring are now labeled as “inactive”; SB-61 and SB-295.

1si continues to monitor HB-1183 as it moves through the process, as additional amendments have been added.

Bills 1si is Monitoring:

  • HB-1121 – Local Income Taxes
    • Passed third reading in the Senate on 3/4/2024 and returned to the House with amendments. The House dissented from those amendments on 3/5/2024.
  • HB-1183 – Foreign Ownership of Agricultural Land
    • Passed third reading in the Senate on 3/5/2024 and returned to the House with amendments. The House dissented from those amendments on 3/6/2024.
  • HB-1199 – Repeal of Economic Enhancement District Law
    • Passed third reading in the Senate on 2/29/2024 and returned to the House with amendments on 3/1/2024.
  • SB-61 – Tourism Improvement District
    • Currently labeled as “inactive”
  • SB-295 – Indiana Economic Development Corporation
    • Currently labeled as “inactive”

Current List of Bills 1si Supports or Opposes:

Supports:

  • SB-2 – Child care
    • Passed third reading in the House on 3/4/2024 and returned to the Senate with amendments on 3/5/2024. Motion to concur was filed same day, and the Senate concurred in House amendments on 3/6/2024.

Opposes:

  • The one bill that 1si opposes, HB-1157 – Non-Disclosure Agreements in Economic Development, has been labeled as “inactive.”

We’ll keep you updated, but if you’d like more information on our 2024 Advocacy Agenda, or to download a copy of it, please visit www.1si.org/advocacy or download your PDF copy here.

Minority Business Spotlight | March 2024

Each month One Southern Indiana will feature a business that identifies as a minority-owned business.  If you are interested in being featured, please email Kana Brown.

This month’s spotlight is on Dr. Janeice Wooten-Kerr and Serenity Smile Care. 

Dr. Janeice Wooten-Kerr has been practicing dentistry for over 15 years. With the passion to empower patients, she provides insight into the importance of good oral hygiene, proper dental care in the home, and regular dental visits. She believes that having a healthy smile impacts many aspects of a person’s life including their self-esteem, interpersonal relationships, career prospects and quality of life. She understands that many people experience dental anxiety, and they fear visits to the dentist. Therefore, the core of her practice is to create a calm and peaceful atmosphere for a positive and exceptional patient experience.

Serenity Smile Care has a spa-like atmosphere with essential oils in the waiting room, warm blankets, Netflix and warm, scented towels for patients to enjoy and to help ease dental anxiety. They are accepting new patients so call the office or go to the website to book an appointment today!

phone: 812-748-8181
www.serenitysmilecare.com

Thank You for Renewing Your Membership | February 2024

One Southern Indiana would like to thank the following members for renewing their membership in February 2024.

Quarter Century Club (25 Years or More)Member Since
The Koetter Group1975
Indiana University Southeast1985
Junior Achievement of Kentuckiana1985
News and Tribune1985
Dennis Ott & Company, Inc.1990
Foam Fabricators1990
Jeffersonville Township Public Library1991
New Albany Floyd County Schools1991
Childplace1994
Indiana Land Co.1994
J. Rorrer & Company, CPA1994
Mister ”P” Express, Inc.1996
Orcutt Winslow + TEG1998
St. Elizabeth Catholic Charities1999
  
Ten to 24 Years 
Fifth Third Bank2000
Floyd Circuit Court Judge 2001
Voss Clark2001
German American Bank2003
Toby’s Lawn & Landscape2003
Wellstone Regional Hospital2005
Park Community Credit Union2006
Leadership Southern Indiana2007
YMCA of Greater Louisville, Inc.2009
Environmental Compliance Source, LLC2010
S & M Precast, Inc.2010
Alpha Energy Solutions2011
GHK Truss, LLC2012
Kelley Construction2012
ATS Integrated Solutions, Inc.2013
C. W. Erecting, LLC2013
Discount Labels, Inc.2013
Schmitt Furniture Co.2013
ERL, Inc.2014
Steel Dynamics, Inc.2014
  
Five to Nine Years 
Denton Floyd Real Estate Group2016
Center for Lay Ministries, Inc.2017
Larry J. Lynn / LegalShield Prepaid Legal Services & ID Theft Protection2017
ARC Janitorial Supply2018
Vitality Senior Services2018
Arnold Painting, LLC2019
Clark’s Snacks2019
Floyds Knobs Water Company2019
New Albany Broadcasting WMYO-TV and WKYI-TV2019
Patrick Johnson Landscaping LLC2019
  
Two to Four Years 
Russell Cellular2020
SERVPRO of Floyd, Clark, Harrison, Perry, Crawford, Orange, Washington & Scott Counties2020
Southern Hospitality2020
BelFlex Staffing Network2021
BluMine Health, LLC2021
CTDI2021
Destination Georgetown2021
ImmunoTek Bio Centers, LLC2021
Ready Set Prep’d2021
Unlimited Travel Consultants, LLC2021
BoomBozz Pizza & Watch Bar2022
Matrix Integration, LLC2022
Operation Parent Inc2022
Zach Wedding, Realtor- Six Degrees Real Estate2022
  
One Year 
American Structurepoint2023
Covered Bridge Golf Club2023
Drake’s2023
Express Employment Professionals2023
John-Kenyon Eye Center2023
M & M Office Solutions, Inc.2023
NAMI Louisville2023
O.K.I Furniture Fair2023
OHM Advisors2023
Open Door Youth Services2023
St. Mary’s Catholic Church2023
The Patch Boys of Southern Louisville2023
Wilson Education Center2023

Economic Update: Latest County Jobs Show Speed Bump; Challenges in Transportation and Warehousing

submitted by
Uric Dufrene, Ph.D.,  Sanders Chair in Business, Indiana University Southeast

Coming out of Covid, the Southern Indiana economy has been seeing some of the strongest job growth in the past 20 years. Not counting the outsize numbers that occurred during 2020 and 2021, the past several quarters have generated some of the most impressive job gains. There was only one other period in the past 20 years where job gains were higher,  2015 and early 2016. Manufacturing, retail trade, and administrative and support, waste management, and remediation industries were the largest contributors to job growth during that period.     

New data are out at the county level, and it showed a noticeable deceleration in job growth for the five Southern Indiana counties of Clark, Floyd, Harrison, Scott, and Washington. This is a rear view of the economy since county payroll data have about a 6-month lag but can contain some useful information about the current state and trajectory of the economy. For the 3rd quarter of 2023, the Southern Indiana region gained 544 jobs compared to the previous year. Throwing out the Covid-related job losses, this would be the weakest since the 3rd quarter of 2019.   

When we break job activity down by industries, we see that the greatest losses occurred with industries that had the strongest gains during the high job growth year of 2015. Both manufacturing and administrative and support, waste management, and remediation (temporary labor services falls in this industry) suffered the largest job losses, losing 745 and 1,159 jobs respectively. Health care and social services added the most, boosting payrolls by 1,185.  For the four quarters leading up to 2023:Q3, health care was the dominant job creator across Southern Indiana.   

Transportation and warehousing saw another drop in payrolls. Back in 2021 and 2022, transportation and warehousing led all industries in job growth across the region. The nation’s economy saw a goods spending bonanza, driving demand for transportation services to carry goods from manufacturers to the consumer’s doorstep. The latest data show that the strong gains in transportation and warehousing had vanished, with the industry seeing negative changes for three consecutive quarters. 

Strong growth in transportation and warehousing was not just a Covid effect.  Back in 2018, transportation and warehousing saw job gains that exceeded 2,000 for four consecutive quarters. For 10 quarters up to 2023:Q3,  the average job change in transportation and warehousing was just 125 jobs. This almost standstill in transportation and warehousing is linked to both challenges and opportunities coming out of Covid. Record-breaking goods spending by consumers, along with all-time highs in freight rates, invited more trucking capacity and this necessitated the hiring of workers. This explains the large increase in transportation and warehousing jobs back in 2022. 

Since then, consumers have shifted more spending back to services, while freight rates have declined to levels that existed back in 2021, after hitting a record peak in 2022. Declining freight rates, along with current excess capacity in the industry have contributed to what some referred to as a “freight recession”. Local numbers in transportation and warehousing reflect part of this slowdown.     

Despite these challenges, truck driver occupations are still among the highest in job postings. A closer look, however, shows that job posting intensity, a measure of how hard employers work to fill positions, is the highest across all job postings and higher than the regional average. It was difficult to fill truck driver positions prior to Covid, and this difficulty has only intensified since.

Other areas of weakness in the 2023 3rd Quarter release dealt with wages.  Average weekly wages declined by $20, but more concerning was the decline in total wages for the region, the first decline since the 2nd quarter of 2020, the start of the Covid recession. Three industries contributed to the overall decline in wages:  manufacturing, transportation and warehousing, administrative and support, waste management, and remediation services.   

The 3rd quarter of 2023 turned out to be a slower period for Southern Indiana, consistent with the subdued growth expected in our 2023 economic outlook. There is a macroeconomy explanation to this 3rd quarter story. National manufacturing was in contraction all of 2023, and transportation and warehousing are still feeling the effects of a Covid boom and subsequent bust.    

We move to the national jobs report this Friday, the Super Bowl of economic indicators.  Watch for the size of the monthly job gains, changes in average hourly wages, and labor force growth. All will provide additional clues about inflation pressures, and subsequent actions, including delayed rate reductions, by The Fed.