The first half of 2020 was bad, economically, for Indiana. So will the state recover in the second half of the year?
Mike Hicks, an economist at Ball State University, predicts a slightly better outlook for the final six months, but Indiana and the local governments will continue to struggle for a while.
“At the state level, we’re looking at a loss of tax dollars somewhere between $2.1 billion and $2.4 billion over the next couple years,” Hicks told Inside Indiana Business.
He says there are certain counties that have been hit harder than others, especially those that heavily rely on casino revenue, tourism, or the bar and restaurant business.
“There are 20 to 30 counties that are facing, perhaps, double-digit (percentage) revenue losses, some extraordinarily high, through 2022 and even 2023,” Hicks said.
He adds that schools in Indiana are already facing financial problems, and it could be even worse this upcoming academic year.
“We don’t know what extra costs for schooling might be,” Hicks said. “I’ve heard about estimates of $1 million or more, per school, to equip them for COVID-19, and that doesn’t include broadband and technology to do online education.”
Hicks says the Hoosier state should slightly recover in the second part of the year, but “we’re not going to get back to where we were (before the pandemic) for a couple of years.” He predicts Gross Domestic Product for 2020 will finish about six percent lower than in 2019.