Thanks to two multibillion investments by StarPlus Energy to build electric vehicle battery manufacturing plants and the record labor contracts obtained by the United Auto Workers union, Howard County’s wage growth and unemployment rate in 2024 will buck statewide trends after years of performing worse, according to a forecast by the Indiana University Center for Econometric Model Research.
The 2024 forecast of the Kokomo Metropolitan area, which includes all of Howard County, was discussed Tuesday at the “Futurecast: Kokomo” event put on by Indiana University Kokomo’s School of Business.
The event, held at the Kelley Student Center on the IUK campus, featured professors and researchers from Indiana University Bloomington’s Kelley School of Business, Kokomo Mayor Tyler Moore and Dmitriy Chulkov, a professor of business analytics and economics at IUK.
Chulkov said he sees Star-Plus Energy’s two EV battery plants, pegged at investments of up to $6.3 billion, that are expected to hire 2,800 as an “engine of growth” for the local economy, bringing up average weekly wages while bringing down the county’s unemployment rate as Star-Plus Energy’s investments bring in additional investments.
Because of that, IU’s models predict the county’s unemployment rate to decline to closer to 4% in 2024. The unemployment rate for Howard County last year was as high as 7%. As of September, the county’s unemployment rate was 4.4%, which is still higher than the state’s 3.3% and the United States’ 3.9%.
Chulkov said the county’s flat population and high number of manufacturing jobs, which is more likely to have temporary layoffs than other industries, contribute to an “unstable” unemployment rate and labor force totals and makes it “difficult” for Howard County to “catch up” with statewide and national unemployment trends. Around 25% of the county’s workforce is in manufacturing of some sort.
“That’s why something like the investment from Stellantis is so important,” he said. “It creates an engine of growth that is in addition to all the trends.”
In addition to lower unemployment, IU models forecasts the county’s average weekly wage increasing year-over-year, in part because of the tentative agreement between the Big Three and the UAW.
The agreement includes a 25% pay raise over the life of the four-year contract, annual cost-of-living increases and more. Workers at General Motors plants voted to ratify the agreement. UAW workers at Stellantis and Ford plants are still in the process of voting.
From March 2022 to March 2023, average weekly wages in Howard County increased more than 9% to $1,277. Chulov said the models are predicting a more modest increase for 2024.
“So, yes, inflation has been high, but specifically in this area, we’ve seen quite a lot of growth in average wage,” Chulkov said. “Obviously, not everyone is getting a 9% raise, but the average for the area has been pretty positive.”
IU’s 2024 forecast is very similar to their 2023 forecast for the region in which it forecasted the county to see job growth and an unemployment rate closer to 3% by the end of the year.
© 2024 Community Newspaper Holdings, Inc.