On the web
Read the Indiana Business Research Center report at www.incontext.indiana.edu/2018/sept-oct/article1.asp
The Wall Street Journal last week noted something peculiar about campaign advertising in the Indiana Senate contest.
“Indiana, far from the Mexican border, and with just 5 percent of its population born in a foreign country, is awash in ads with anti-immigration messaging,” according to the report. “TV viewers in the state aren't seeing any pro-immigration messages.”
The candidates and their campaign advisers undoubtedly are stoking the anti-immigration fires because it's proven effective in past practice or in polling. But if they want Indiana to grow and prosper, they should back off the fear-mongering. A new report from the Indiana Business Research Center suggests Indiana's workforce will grow by only 34,000 between 2020 and 2050. The state's economic future depends on its ability to attract young workers, including legal immigrants.
Matt Kinghorn, senior demographic analyst for the research center, notes the state's labor force will record a “relatively healthy gain of 120,000 workers between 2010 and 2020” but will likely contract over the next decade as more baby boomers retire. Lower fertility rates affect the labor pool, as well. If rates had held steady to those recorded before the Great Recession, Indiana would see 70,000 more births than are expected in that decade-long span.
Migration is another factor, of course. Indiana saw its population and labor force declining through the 1960s, '70s and '80s, but the trend was reversed with gains in net migration between 1990 and 2010. Hispanic residents moving into the state were responsible for 77 percent of the gain, according to data from the Applied Population Laboratory at the University of Wisconsin.
“As with fertility rates, however, the Great Recession triggered a period of lower levels of migration to the state that is still in effect today,” Kinghorn writes. “Indiana had an average annual net in-migration of 17,500 residents during the 1990s, and this measure stood at 9,200 residents per year in the 2000s. Between 2010 and 2017, however, the net inflow to the state has dropped to 1,900 residents per year, which is another factor working against stronger labor force growth.”
The dilemma is greater for northeast Indiana than for central Indiana, where Indianapolis and surrounding counties will see the highest labor force growth.
In this region, only Allen and LaGrange counties are projected to see growth by 2025, according to the research center projections.
“These data suggest that unless migration patterns shift significantly, this trend will continue,” Kinghorn writes. “Only 22 of the state's 92 counties are expected to see their labor force hold steady or grow between 2015 and 2025.”
Why does it matter? Because Indiana's aging population needs young workers. Demographers illustrate that point with an economic dependency ratio: Residents not in the labor force relative to the population that is in the labor force. There were 100 Hoosiers working for every 99 Hoosiers not in the labor force in 2010. By 2040, the ratio will be at 100 workers for every 114 Hoosiers not working.
“While Indiana has had higher dependency ratios in the past, these were weighted more toward children; however, in the future, retirees – with accompanying higher health care costs – will hold a larger share of the population outside of the labor force,” Kinghorn writes.
Demographic observers have been warning for some time now that immigration is an economic lifeline for Indiana and its neighboring states. But instead of heeding their message, Indiana politicians – on both sides of the aisle – have fed the narrative of immigration as a threat to our safety and well-being.
A workforce inadequate to support our aging population is the real threat. An honest immigration debate is what we really need to hear.