Muncie forecast 2024

Dagney Faulk, Ph.D.

Director of Research, Center for Business and Economic Research, Ball State University

Cade Deckard

Research Assistant, Center for Business and Economic Research, Ball State University

The Muncie metro showed continued employment and wage gains over the past year. However, the level of employment is still lower than the pre-pandemic period, unemployment is higher than it was a year ago and the labor force has decreased. New home construction has slowed, even as sales prices for existing homes have reached new highs. The number of food stamp recipients is lower than it was a year ago, but is still much higher than pre-pandemic levels.

Business news from 2023 includes the departure of PepsiCo, which announced the closing of its Muncie distribution center.¹ The long-languishing Muncie Mall was sold to Wells Fargo, who is currently seeking a buyer.² Delaware County Commissioners extended a solar farm moratorium through the end of the year while working on a solar farm ordinance for the county.³ Housing development continues: D.R. Horton, a Texas-based homebuilder, purchased vacant property on the northwest and east sides of Muncie and plans to construct new housing.⁴ Riverbend Flats, an affordable housing development on the site of a former Marsh Supermarket on the southeast side of Muncie, opened.⁵ Finally, construction began on a new YMCA, which will enhance the recreational amenities available in the county.⁶
This article uses the most recent data available (at the time of this writing) from public sources on various measures of economic activity for the Muncie MSA (Delaware County) to analyze changes over the past year. A summary of the labor market forecast for the Muncie area is included in the conclusion.

Labor markets

The Muncie metro area experienced increasing unemployment rates over the last year with the unemployment rate reaching 5% in July (see Table 1). It has since decreased, but is about a percentage point higher than it was a year ago and higher than both the Indiana and U.S. unemployment rates. The labor force experienced a year-over-year decrease of about 500 people and is still lower than pre-pandemic levels. The labor force totaled more than 54,000 people before the pandemic. 

Employment by industry (see Table 2) was measured using January-to-August averages for each year. Although overall employment is still lower than pre-pandemic levels, total nonfarm employment topped 47,600, a small increase over the previous year. The manufacturing sector (+5.3%) and other services (+4.8%) experienced the highest growth rates. Other sectors, including government (+2.9%), financial activities (+2.7%) and leisure and hospitality (+2.6%), also experienced notable growth rates. Retail employment was steady. 

Muncie’s average weekly wages increased to $966 per week, an 8.1% nominal increase from the previous year (see Table 3). In total, 16 industries experienced increases in weekly wages, the largest being professional, scientific and technical services (+21.2%) and real estate and rental and leasing (+19.7%). Only two industries experienced weekly wage decreases, management of companies and enterprises (-3.3%) and public administration (-2.2%).

Using the Midwest Consumer Price Index for the first quarter, the inflation rate was 5.47%, which is lower than the 8.14% inflation rate of the previous year. Of the 16 industries that experienced nominal wage growth, 14 experienced wage growth that was higher than the inflation rate. The two sectors with wage growth below the inflation rate were educational services (4.9%) and health care and social services (5.4%).

Housing

High mortgage rates and economic uncertainty are reflected in the building permits data. There was a dramatic decrease in the number of building permits issues during 2023 as compared to the previous year. Through August 2023, 48 residential permits were issued in the Muncie metro, with 43 of them being single-family units and five being multi-family units (see Table 4).

Turning to single-family home sales, the number of units sold during 2023 continues the decrease that started last year (see Table 5). The relatively low average number of days on the market, along with the higher average and median sales prices relative to previous years, indicate that there are likely supply-side issues in this market, where demand for available houses for sale is higher than supply. We expected prices to decrease over the past year as mortgage rates have increased, but this data suggests that has yet to occur. The housing market remains tight.   

Social safety net

From August 2022 to August 2023, total food stamps issued in the Muncie metro have gradually increased from $2.4 million to $2.7 million (see Table 6), which partly reflects the inflation adjustment that occurs at the beginning of each federal fiscal year. Food stamp payments are substantially higher than before the pandemic when they were typically closer to $1.5 million each month and fewer households received the benefit. Although the amount of food stamp payments issued increased by 13.2% over the year, the number of households and individuals receiving food stamps decreased through the spring of 2023 and then increased through the summer. Year-over-year, the number of recipients decreased slightly.

Table 6: Food stamp recipients in Delaware County, August 2022 through August 2023

Source:  STATS Indiana, Indiana Family and Social Services Administration data

Outlook

The data and analysis presented here show a somewhat mixed picture for the Muncie metro. The unemployment rate is higher than it was a year ago, but has decreased over the past few months. Nonfarm employment increased overall (and in most industry sectors) compared to the previous year, and most industry sectors have experienced positive inflation-adjusted wage gains. Residential construction has slowed while the housing market remains tight, even though mortgage rates have increased substantially. Food stamp usage remains much higher than pre-pandemic levels.

The most recent forecast from Indiana University’s Center for Econometric Model Research shows employment growth of 1.86% over the next two years.⁷ Personal income is expected to increase 3.13% through 2025 and population is expected to decrease 0.25% over the same period.