News From Terre Haute, Indiana

Mark Bennett Opinion

March 13, 2010

MARK BENNETT: Hoosiers with more education weathered recession better

TERRE HAUTE — Trouble tends to grab humans’ attention.

We might ignore the value of a storm cellar, until a tornado devastates our neighborhood.

The Great Recession exposed a bunch of harsh realities, and produced lots of “teachable moments.” Anyone with an ounce of wisdom will think twice before spending themselves into debt, or presuming their livelihood is “recession-proof” or investing in too-good-to-be-true deals.

As the recession recedes, one large piece of its debris has become plainly visible in Indiana.

An education can be a liferaft, or more, when economic storms hit.

In 2008, the recession’s first full year, Indiana’s poverty rate rose 30 percent from the previous year, according to a report issued last week by the Indiana Institute for Working Families. Earning a substantial paycheck wasn’t terribly common for Hoosiers before the downturn fully hit. Between 2007 and 2008, Indiana was one of only five states to experience a decrease in real median household incomes, according to U.S. Census American Community Survey statistics.

And, the less education a Hoosier had attained, the harder the recession hit.

“During the recession, workers that have higher levels of education have fared better,” Sarah Downing, a Rockville native and now a research and policy analyst for the Indiana Institute for Working Families, said by telephone from Indianapolis.

A whopping 22.5 percent of Hoosier workers lacking a high school diploma were unemployed, according to the institute’s report “The Status of Indiana’s Working Families, 2009.” The jobless rate for high school graduates was 13.4 percent, 8.5 percent for Indiana residents with at least some college experience, and 1.8 percent for those holding a college bachelor’s degree.

Their earning power followed similar lines. The median hourly wage for Hoosiers with a bachelor’s degree was $23.10. That was $8.66 more than people with some college training, and $9.47 an hour more than high school grads.

Indiana continues to have a higher percentage of its workers employed in factories than any other state. Still, manufacturing suffered during the recession. Approximately 40,000 such jobs disappeared last year, an Indianapolis Star report said. The traditional Hoosier economy is shifting. “Indiana was once a place where you could graduate from high school, get a factory job the next week, work for 30 years, and then retire with good benefits,” Downing said.

Not any more.

The recession put a spotlight on the state’s evolving job market, and the need for a more highly educated work force.

So, what should we learn from this rough, teachable moment in time?

Indiana must find a way to help more Hoosiers graduate from two-year and four-year colleges. That task grew taller after Gov. Mitch Daniels ordered $150 million in cuts to public colleges and universities, forcing the schools to implement drastic reductions. That’s the Catch-22 — the state must trim expenses to balance its budget, but higher education needs to expand for Indiana to prosper in the future.

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    March 12, 2010