Kokomo’s economic growth continued to pace much of the nation in 2012, with the area’s auto industry leading the charge.
Preliminary 2012 statistics released last week by the U.S. Bureau of Economic Analysis showed especially strong growth in the Midwestern manufacturing states, where the auto industry has rebounded.
In Kokomo, which saw its annual gross domestic product drop to $2.32 billion in 2009, the year the city’s largest employers filed for bankruptcy, the employment rate is at a five-year low.
According to the BEA, Kokomo’s GDP grew by 8.4 percent in 2012. The announcement comes hard on the heels of new employment figures showing the Kokomo metro area picking up a full percentage point in August.
Kokomo’s 2012 growth places it third in the state and eighth in the nation, according to the BEA, with only Elkhart-Goshen and Columbus growing faster in Indiana.
The turnaround is particularly sweet for a city Forbes magazine called one of the nation’s “fastest dying” areas in 2009.
“We’re working hard to improve our community and make Kokomo a better place for residents and businesses,” Kokomo Mayor Greg Goodnight said. “Our local businesses have noticed our efforts and have invested in their Kokomo facilities and workforce. These investment decisions will positively impact our community for years and decades to come.”
Chrysler Group LLC has been by far the largest contributor to Kokomo’s growth, with $1.8 billion in upgrades planned, completed or underway at area plants. The company has added nearly 2,000 jobs locally since the 2009 bankruptcy.
Alloys manufacturer Haynes International announced a $23.5-million investment to expand its manufacturing capacity, and Goodnight pointed to investments made by small business: Carney Echelbarger relocated to Kokomo and invested $700,000 in its new facility; and EAC Corp relocated to Kokomo and invested more than $200,000 in new equipment.
Kokomo added about 1,400 jobs from 2011 to 2012, according to city officials.
“As positive as these announcements are, we also know that they are just the beginning,” said city of Kokomo Development Director Steve Whikehart. “We will continue to promote economic development and improve quality of life in our community by building partnerships, by investing wisely and by demanding more of ourselves in everything we do.”
According to retired Indiana University economist Morton Marcus, Kokomo hit an employment peak in 2005, just prior to Delphi Automotive Systems filing for bankruptcy. Marcus said Kokomo’s workforce is now about 10 percent smaller than it was back then.
But even prior to the Delphi bankruptcy, Kokomo had been shedding jobs, along with the rest of the auto parts-producing cities of the Rust Belt. According to the U.S. Bureau of Labor Statistics, Kokomo lost about one quarter of all of its jobs in the decade between 2000 and 2010.
That trend now appears to be reversing.
According to the Indiana Department of Workforce Development, Indiana has added over 60,000 manufacturing jobs since the 2009 low point, making it the state with the second largest growth in the manufacturing sector in that time period.
According to BEA analysts, durable goods manufacturing “fueled growth in many small metropolitan areas where it constitutes a large portion of the area’s economy,” and said the impact of manufacturing is “especially true in the Great Lakes region where durable-goods manufacturing contributed 8.5 percentage points to growth in Elkhart-Goshen, 8.3 percentage points to growth in Columbus, and 7.2 percentage points in Kokomo.”