Muncie, IN economy lacks human capital says Ball State expert
By Rick Yencer
MUNCIE, IN - A local job fair proved what a Ball State economist said about why the community and others parts of the country face high unemployment despite an improving economy.
"The continued high unemployment in Muncie and many other places is largely a consequence of lagging levels of available human capital," said Michael Hicks, an economist who heads the university's Center for Business and Economic Research.
While lots of people don't have work, far fewer are well suited to the types of jobs the economy is creating, he said, while skilled trades jobs are few in central Indiana.
A job fair at Ball State Monday offered more than 1,100 jobs, although only about 350 job seekers showed up, making it the lowest turnout in many years. And that effort is coupled with a 10 percent unemployment rate in Delaware County, compared to a national rate at 7.4 percent.
And some of the job seekers, like Mike Sherwood, a seasonal park worker, hoped to get a fulltime job at Keihin North America as an assembler after working as a cook in the U.S. Air Force.
"I am good at organizing and and putting things together," said Sherwood.
About 50 employers showed up including a group of job headhunters like Manpower, Staffmark and Employment Plus along with manufacturers like Littler Diecast, Reliance Machine and Delaware Dynamics.
Chris Cardemon of Reliance, was looking for a CNC machine operator besides an office assistant, saying he had plenty of orders for auto, energy and other parts manufacturing. Reliance employs about 135 people between Muncie and Ridgeville plants.
Reliance wants skilled machine operators and Cardemon said it was difficult to find skilled labor although he had a couple prospects on Monday.
That disconnect among skills, job seekers and employers was one reason Mayor Dennis Tyler partnered with Work One to provide more machine and building skills training to fill manufacturing and building jobs. Out of the nine people who entered the program, seven found jobs.
Tyler was unsure why there were so many jobs on the table Monday with few people who were interested.
Congressman Luke Messer, who inherited the job fair from previous congressmen Mike Pence, now governor, and David McIntosh, a policy analyst, had his own ideas about why the economy lagged in eastern Indiana besides other parts of the country.
Some employers are afraid of hiring full time and permanent workers because of the Affordable Care Act that requires health care for everyone. And while Republican congressmen want President Obama to consider tax cuts to improve the economy, Obama has been pushing some stimulus spending to build new bridges and roads while promoting job growth,
The obstruction between Republican congressmen and the Democratic White House is so bad that a Farm Bill has yet to pass and now some Republicans want to shut down the government if ACA is enacted.
Hicks said even ACA supporters realized the risk to the labor market when they delayed implementing affordable care.
"In order for it to work, there had to be enough economic growth that employers and employees would accept additional costs as part of doing business and the state exchanges had to work well," said Hicks. Neither of those conditions have been met, he added.
Hicks said the administration was responsible for some of the slowing growth although the stock market is at an all time high at 17,000 and there's been six-figure job growth during the summer.
And he said the ACA was poorly designed and federal government has been ineffective at administering it. One issue Hicks raised that the ACA did not adopt Republican argument about cross-state competition among insurers. That means that in many states, health care premiums for both existing and exchange like consumers will rise while in others it will fail.
Hicks insisted the President and his political majorities simply screwed up health care reform and that is why the economy languishes and will get no better. ACA also is why new jobs have been mostly part time for economic reasons.
Many companies and even public institutions have been getting rid of fulltime employees with insurance and benefits and hiring part time workers. The latest case was the Muncie Public Library last week when it got rid of a handful of veteran librarians and took applications for part time workers to replace them.
Joe Evans, who heads the East Central Indiana Building Council, acknowledged much of the job growth was part time as skilled labor finds it difficult to find work in the Midwest. He supported more stimulus to get people back to work on public works and infrastructure.
Messer, a Republican who has voted repeatedly to repeal ACA, reiterated that tax cuts would stimulate manufacturers and others to add more jobs and spend money to improve the economy.