Brian Howey: Are You Better Off?

In 1980, Republican presidential nominee Ronald Reagan posed this blunt question during a debate with President Jimmy Carter: “Are you better off than you were four years ago?”

It is an enduring query, reprised just about every four years from every presidential challenger, including Republican Donald Trump this past fall on his way to a victory over Democratic Vice President Kamala Harris.

So this is a column for the future. If you’re reading this in a newspaper, clip and save. If you’re on the State Affairs website, bookmark this entry, because this question will almost certainly be posed once again in 2028.

According to the research website GIS, the U.S. jobless rate when Trump entered the White House in 2017 was 4.7%. It decreased to 3.5% before the COVID-19 pandemic and peaked at 14.9% in April 2020. When Joe Biden took office in January 2021, the unemployment rate was 6.4%; it has gradually declined to the low of 3.4% in early 2023. In July 2024, the jobless rate stood at 4.3%.

In Indiana, the jobless rate stood at 4.6% in January 2017, skyrocketed to 16.8% in April 2020 during the pandemic, and then receded to 2.9% in February 2022. It stood at 4.4% in October 2024.

Indiana had 141,000 unfilled jobs in September 2024, according to the Bureau of Labor Statistics. According to JobTest.org, Indiana had 78 workers for every 100 jobs available. Hoosier companies had 37,000 fewer workers compared to what would be needed for full employment.

There were 8.2 million open jobs in the United States last summer, and only 7.1 million unemployed workers.

Indiana is one of the most manufacturing intensive states. “One of the brightest spots in the economy has been the strong surge in corporate investments, particularly in manufacturing facilities,” observed economist Steve Rattner. “The latter was substantially stimulated by two major pieces of legislation passed during the Biden administration. The inaccurately titled Inflation Reduction Act offered tax credits and other assistance for climate-friendly energy projects while the CHIPS and Science Act allocated nearly $40 billion to stimulate production of semiconductors in the United States. Investment in other areas, particularly relating to technology and artificial intelligence, has also been increasing rapidly, a promising sign for future economic growth.”

Manufacturing construction has crossed the $22 billion nationally threshold since Sen. Todd Young’s CHIPS and Science Act passed in 2022 (with little support from the Indiana GOP congressional delegation) and was signed by President Biden. In 2020, manufacturing construction stood at less than half that amount in the U.S.

“Since 2022, eight companies have announced plans to establish semiconductor manufacturing plants here, committing to invest more than $6 billion and create more than 2,100 new high-skilled, high-paying jobs for Hoosiers,” according to the Indiana Economic Development Corporation. Indiana is now home to a new, 10-acre microelectronics campus — WestGate One — a public-private development near the Naval Surface Warfare Center, and the state landed a new federal microelectronics hub designation through the CHIPS and Science Act, bringing $32.9 million in funding in the first year for the Silicon Crossroads Microelectronics Commons Hub.

According to the Indiana University Kelley School of Business, Indiana’s Gross Domestic Product in 2024 was projected to be $416.4 billion, which is a 2.3% increase from 2023. Real GDP annual rate change was 3.9% for Indiana, compared to 2.5% in Ohio, 2.9% in Michigan, 2.0% in Illinois and 4.0% in Kentucky.

Indiana’s GDP is expected to be 2.9% in 2025, according to IU researchers. “We expect a slowdown in employment growth, matching that in the pre-pandemic period,” said Carol Rogers, director of the Indiana Business Research Center. “Income growth slows slightly during the middle half of our forecast but then stabilizes. Both employment and income fall short of what we expect at the national level.”

Indiana’s personal income went up at an annual rate of 1.8%, compared to 3.2% nationally, 3.5% in Kentucky, 3% in Ohio, 2.9% in Michigan and 2.6% in Illinois.

Voters returned Trump to the White House largely due to two issues: Inflation and immigration.

According to GIS, inflation under President Biden rose from 1.4% in January 2021 to 9.1% in June 2022, after which it declined to 3% in June 2024. During the same period, the money supply rose by “just” 10% in nominal terms and interest rates shot up to 5.5%.

“The public at large was not pleased,” the GIS analysis observes. “Households and many small businesses were heavily indebted after the Trump years and, therefore, were severely hit by the rise in interest rates in the Biden years. Inflation also hit purchasing power since wages failed to catch up with rising prices. Last but not least, Washington gave the impression that the authorities were not in control. First, the administration claimed that inflation was transitory, then they said they would bring it back to about 2% by the end of 2023. Finally, it stopped announcing specific targets and deadlines.”

President-elect Trump has vowed to install high tariffs on China and America’s key trading partners in neighboring Canada and Mexico. Trump has also signaled a widespread effort to deport up to 15 million undocumented workers.

How these two issues impact the economy will become one of the enduring legacies of the second Trump presidency, and will provide answers to this enduring political question.

Brian A. Howey is a senior writer for Howey Politics Indiana and State Affairs. Find Howey on X @hwypol.