Bloomington-Normal Economy Well Off Peak But Holding Steady | WGLT

Bloomington-Normal Economy Well Off Peak But Holding Steady

Dec 11, 2017

There are 9,000 fewer workers in Bloomington-Normal than there were seven years ago, according to Economist Mike Doherty of the Illinois Farm Bureau.

"Our labor force peaked back in 2010 at over 105,000 people working. And we are down about 9 percent from there. That's in keeping with declines in labor force nationally, in the state of Illinois, and with surrounding communities," said Doherty.

The current workforce size is about 96,000 people, a seasonal high, according to Doherty. The state of the local economy will be featured at the EDC's next BN By the Numbers event on Thursday.

Doherty said major drivers of that decline include baby boom retirements, the closure of the Mitsubishi plant, State Farm ending consulting contracts following its digital reinvention, and government shrinkage.

In spite of that, Doherty said, the local economy is doing well at the moment, with a 2 percent year-to-date increase in sales tax revenue and very low unemployment rates. Normal's sales tax receipts are down. Bloomington's are up.

A closer look at Bloomington-Normal's shrinking labor force, according to data from the Illinois Department of Employment Security:

Labor Force - Bloomington-Normal

"We had a total employment level of 92,846 and a 3.9 percent unemployment rate back in January 2007, 10 years ago," said Doherty. "It peaked in 2010 at over 98,000. In 2016 (June and August of 2016 and even as late as January of this year) we were at or just under 91,000 people employed, still well under our peak and well under where were at 10 years ago. So I think all other numbers, housing, income, etc., need to be looked at with that in mind," he said in citing Bureau of Labor Statistics figures.

Those who argue for cuts to municipal governments to balance strained budgets are missing part of the picture, according to Doherty. Government's share of the workforce has declined to 17.5 percent of local employment from more than 18 percent in the year 2010.

"It looks like they have already addressed those factors as far as their ability to cut back on the number of people they employ in the government sector. You could even argue that people expect more every year from government services and they do a little bit more each year. And yet they are doing it with 1,000 jobs less than at their peak eight years ago," said Doherty.

Year-over-year employment figures, Doherty said, show there wasn’t any employment growth in the Twin Cities from summer 2016 to summer 2017. Peoria only saw a 0.3 percent increase.

Financial Activities, a sector that is over 20 percent of Bloomington-Normal's total jobs and which include State Farm, is holding its own—down 3 or 4 percent from what it was eight years ago. In fact, it's higher than it was three years ago, in 2014, when it fell to under 20,000 workers, said Doherty.

Professional and Business Services, a sector that includes about 11 percent of jobs in the Twin Cities, continues to show growth since lows last year, solidly up in 2017 by over 1,000 jobs in most months, compared to 2016. Basically that is back to 2014 levels. This sector saw significantly higher peak numbers back in 2011 and 2012, at around 11,500 jobs.

There was also continuing growth in Education and Health Services, a sector that includes hospitals and schools. In October, that sector finally matched high points from 2009 and 2010. Doherty said that is the only sector to reclaim that position.

"The most consistent recovery we have seen is in Hospitality and Leisure, I assume due to the new hotels opening up. In the past six months of 2017, we’ve been at solidly high levels, just under their peak in August 2016 at 12,000 jobs," said Doherty.

This sector accounts for about 12 percent of all jobs in the county.

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