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Indiana will lead the Midwest’s economy this year, with job growth of 1.3%. The Hoosier State’s hospitality sector is the region’s only one to have recovered all the jobs lost during the pandemic, and construction activity is solid. Indianapolis saw a surge of building permits issued late last year, which means more construction this year. Data centers are also a big business. Facebook owner Meta just announced that it will build a large data center in southern Indiana, across the Ohio River from Louisville, Kentucky. Google is planning a similar data center project in Fort Wayne. A Canadian-owned solar business plans to open a panel-making plant in 2025 in Jeffersonville, creating 1,200 jobs, while Indianapolis is getting a new plastic recycling plant this year.
Ohio will be close behind, with job growth of 1.2% this year. Healthcare jobs are booming, and lately, the hospitality industry has been on the upswing. However, most other sectors are flat or down. The Columbus area has become a major hub for data centers with 40 so far, and tech firms are planning to double their square footage. Wells Fargo is also developing a new IT/software development facility in the city. Amtrak aims to start fast rail service connecting Ohio’s big cities, but not until 2030. Vertical takeoff air taxis will be manufactured close to Dayton’s airport, bringing 2,000 jobs.
Wisconsin's job growth is slowing but will come in at a still-decent 1.1%. It has the most job openings in the region, and the workforce saw a large increase last year, which bodes well for future hiring. Construction, health care, hospitality and government are hiring steadily. Two big summer events — the Summerfest music festival and the Republican National Convention — promise to give Milwaukee’s local economy a boost. 50,000 visitors are expected at the RNC. Small Sun Country Airlines is expanding, while most large airlines are cutting back their regional routes. New routes will be announced in the state this spring.
Missouri sees slower gains on tap. It can expect job growth of 0.8%. Hospitality is strong, but tech firms have been shedding a lot of workers. The closure of one of the last five aluminum smelters in the U.S., due to rising power costs, hurts. On the plus side, a $1.2 billion project to redevelop St. Louis’s waterfront is starting up, and the search for a new stadium for the Kansas City Royals has narrowed to two sites. The downtown one is favored, while the other could end up as a new mixed-use project. A 120-mph powerboat race on the Mississippi River near St. Louis is expected to draw 20,000 spectators in June.
Michigan is the last on our list in the region. Job growth will register 0.7%. Most sectors are flat or down, except for health care, though an increasing labor force and a likely pickup in motor vehicles are positives. A survey of local business people reported more optimism than pessimism about the economy in 2024. Detroit office space is the cheapest among major metro areas. By contrast, Ann Arbor, home to the University of Michigan, is thriving, with local job growth set for better than 3% this year. In the western part of the state, construction on a 320,000 sq. ft. events center for Kalamazoo will begin this fall. It is expected to be completed in 2027 and will host sports teams from Western Michigan University.
Illinois has the highest unemployment in the region, at 4.8%. However, it should still see job growth of 0.6% this year. Outmigration continues but is slowing from its COVID-era peak. Healthcare is doing well, but manufacturing is flat, and business services showed a worrisome drop late last year. Chicago’s White Sox are considering moving closer to downtown, and the Bears are thinking of renovating their current stadium downtown instead of the move to the suburbs that they had previously announced. More alternative energy is in development: Nexamp will establish its headquarters in Chicago, and its solar projects will meet the power needs of 50,000 households. ComEd has 13 wind power projects in development, and Pivot Energy will develop six solar power projects in downstate Illinois by 2026.
This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.
