Indiana University traditionally has propped up Bloomington, Monroe County and the surrounding area during tough economic times.
But now, due to cuts in state and federal funding and a number of layoffs, uncertainty at the university is dragging down the local economy.
“Folks, the news is rough,” said Phil Powell, executive director of the Indiana Business Research Center at Indiana University’s Kelley School of Business.
He said that at the IBRC’s presentation of its 2026 Futurecast, its annual economic forecast, in Bloomington last week.
Read more: Private businesses will bolster Bloomington after IU cuts, economic experts say
Powell said Bloomington is having a rough year, and next year’s growth might not be much better.
“If we're lucky to have 1 percent here in the region, it will have been a good year for Bloomington,” Powell said. “I'm thinking more zero to 0.5.”
The state, however, is faring batter. While wages in Bloomington fell by 6.2 percent this year, they grew by 5.6 in the state.
Indiana University is one of the main reasons. It accounts for about 20 percent of the economy in Monroe and surrounding counties. Powell said the university will likely continue to cut jobs and wages in 2026.
“If you're feeling some economic pain in your markets and your customers, it's happening right here, folks,” Powell said. “It's driven by what’s happened in higher ed.”
On this week’s Noon Edition, we’ll discuss the findings of the Indiana Business Research Center’s 2026 Futurecast and what it means economically for Bloomington, Monroe County and the state.
Join us on the air by calling 812-855-0811 or toll-free at 1-877-285-9348. You can also send questions for the show to news@indianapublicmedia.org.
You can also record your questions and send them in through email.
Guests
Phillip Powell, Executive Director, Indiana Business Research Center
Andrew Butters, Associate Professor, IU Kelley School of Business
Jennifer Pearl, President, Bloomington Economic Development Corporation
