Bloomington’s 2025 economic story is about adapting and rising to meet challenges. Flexibility, strategic investment and collaboration are critical to securing our region’s future.
Recently, business and civic leaders delivered this message of urgency and opportunity at the State of the Bloomington Regional Economy, hosted by the Bloomington Economic Development Corp. (BEDC). The event’s speakers included Eric Starks of FTR, Matt Eckerle of Baker Tilly Municipal Advisors, and Phil Powell of Indiana University’s Kelley School of Business, with a panel discussion moderated by TechPoint President Ting Gootee.
Tariffs continue to create economic uncertainty, according to Eric Starks, with federal trade policies remaining in flux. He emphasized that this volatility makes it difficult for businesses to plan ahead or invest confidently. Tariffs have been changing almost weekly, as the current administration weighs new decisions that could significantly impact global supply chains.
Indiana’s state-level property tax reforms and recent legislation are triggering revenue losses for local governments in the coming years, explained Eckerle. Cities must leverage data to plan for future contingencies. Governments can lean into public-private partnerships and become more strategic with tax increment financing (TIF), local income taxes and capital budgeting to address revenue shortfalls. Communities must make strategic financial decisions to ensure they have the resources they need to adapt.
Local wages and productivity have lagged, but strategies are already in motion to address these challenges. Powell highlighted that Bloomington’s productivity grew only 1.7% between 2017 and 2022 — far behind Indiana’s average of 8%, which exceeds the U.S. average of 7%. This negatively impacts wages. High local housing costs undermine workforce growth, as Bloomington saw a 7.7% drop in working adults between ages 25 and 44 since 2019.
But Powell also outlined the ways Bloomington is working to reverse this course. This includes IU’s investments in life sciences and microelectronics and pro-growth municipal leadership. The business community also has rallied for key investments ranging from Novo Nordisk and Simtra’s growth, to development in focused geographic areas like the Bloomington Trades District and Bloomington Convention Center.
Artificial Intelligence can be a vital tool for addressing these economic challenges, noted the panelists, as they discussed AI’s growing influence. Overall, AI should be included in a strong workforce strategy, with a pipeline of skilled trades and apprenticeships to enhance productivity on the ground. Manufacturers can use AI to improve productivity and competitiveness, while governments can use it to automate tasks and improve services. Tech layoffs stemming from AI developments also pose an opportunity for companies seeking to recruit this talent to advance their operations.
