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The Economy of a College Town


College towns like Muncie, Indiana face challenges to thrive economically.

Muncie’s story is similar to many other midwestern cities; a former industrial boomtown that fell on hard times after its core businesses left. The well-paying manufacturing jobs that used to boost the local economy disappeared, resulting in lower incomes, lower tax revenue for the city, and higher unemployment rates.

Why all of those jobs left town is subject to a lot of speculation, according to Muncie Mayor Dennis Tyler. Many companies that used to operate in the area exported jobs internationally where lower wages made it easier to turn a profit, but Tyler says it was a more complicated issue.

As a result, Muncie was left with hundreds of blighted and abandoned properties, factories, and businesses scattered across the area. Its infrastructure suffered, and it became harder for the city to find money to put toward community improvement.

According to the Bureau of Labor Statistics, Muncie’s employment rate dropped about 62 percent between 1994 and 2010, and its unemployment rate rose at the same rate in that time frame. Salaried factory jobs gave way to lower-paying hourly retail positions, and Muncie joined the ranks of many other cities who faced the same fate.

The Thomas Business Center is one of the area’s older still-functioning firms. Started in 1930, it saw Muncie go from boomtown to what it is today. At one time, it supplied many of the major businesses in town including all of the Ball Corporation, Ball Hospital, and the university. Today it maintains a core base of clients locally and in Indiana’s surrounding states.

Ball State alumnus Kent Thomas is its current owner. He’s the third generation in his family to run the business. Despite its longevity, Thomas says the business did encounter significant challenges over the years. They’ve had to cut staff, turn down contracts, and reconsider the way they acquire new business, but they’ve been in Muncie the whole time.

“This is where we grew up, and as long as we’ve been able to provide ourselves and the people that work here a living, we’ve made a decision to stay here,” Thomas says.

Thomas feels that the city has potential to improve, but he’s unsure if it will happen or not. He’s confident in the city’s amenities and infrastructure, but says the local leadership needs to make the right decisions if it will continue to grow.

Ball State University is the Muncie area’s largest employer. At more than 3,600 full- and part-time non-student employees, a significant chunk of money and disposable income in the city comes directly from the university.

Mayor Tyler says without the partnerships and influence from the university, his job would be a lot tougher.

“I really even wouldn’t want to think about that,” Tyler said. “We’d be a ghost town.”

Tyler says the city would survive without the university, but it would be much more difficult without student and faculty support, both economically and culturally.

College towns typically have fairly stable economies because they have a consistent number of students who live and spend money there, but that impact is relatively small in a regular college town whose economy doesn’t rely so much around its university. Those towns also don’t usually lose their core businesses the way that Muncie did.

Another challenge faces the city and the university in particular; many professors work in Muncie, but choose to live elsewhere. Even though they may spend a lot of time in Muncie, they may not be invested in the community beyond their capacity within the university.

Ball State Art Professor Maura Jasper moved to Muncie in 2008 after completing graduate school, intending to stay and teach for a short while before moving on. Jasper has lived in large cities all over the country, including New York City and Boston, but says she decided to stay after she saw all of the opportunities for artists it had to offer.

Jasper says that because Muncie is such an affordable place, finding spaces and resources for creative projects is a lot easier than it would be in a larger city.

Muncie made a distinct impression on Jasper when she first moved downtown. Within a week, she met her neighbors and found herself volunteering at a street festival alongside them. She says she was inspired by the sense of community she encountered.

Jasper now serves on the Muncie Arts and Culture Council and regularly puts together art shows where student artists and Muncie locals work alongside one another.

Despite organizational efforts from groups like the Arts and Culture Council, a large part of the money problem in Muncie stems from property taxes, or lack thereof. Ball State and Ball Memorial Hospital are two of the largest institutions in the area, but they are non-taxable because they are public institutions. Additionally, the city isn’t making any money on the hundreds of abandoned properties scattered around town, so Tyler says it can be difficult to find money to put toward improving the city.

To combat this, Tyler says the city has a number of economic development initiatives in the works that would make the city more attractive to people and businesses. This means projects like bike trails, cultural centers, and creative spaces like the new Gearbox Makers’ Hub, which is an industrial building the city is renovating for artists and small businesses.

Tyler says the way the city will thrive economically is by building a workforce of young people that live and work in the city, which is the primary goal of these initiatives. That could mean engaging Ball State students to stay in Muncie after they graduate, or just making a nice place where people from elsewhere would want to move.

These projects have encountered some resistance from people in the Muncie business community who do not believe the government has a place in economic revitalization, Tyler says.

“To be very honest, it’s always going to be a challenge, because there’s always going to be a group of people that for whatever reason just don’t want communities like Muncie to be successful,” Tyler said.

Despite the economic challenges, it’s clear that Tyler and many people in organizations in Muncie are invested in the city’s future. Whether or not their efforts will rebuild the city, both literally and figuratively, remains to be seen, but they certainly have a vision that they hope will someday become a reality.

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