Obama to find Indiana county still dependent on RV industry

AP News
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Posted: May 31, 2016 6:04 PM
Obama to find Indiana county still dependent on RV industry

ELKHART, Ind. (AP) — President Barack Obama came to Elkhart County less than a month after he took office, visiting the Indiana manufacturing center that was then struggling in the depths of the Great Recession to highlight his economic policies.

When the president returns Wednesday to the city of Elkhart, which bills itself as the "RV Capital of the World," he will find the area remains heavily dependent on recreational vehicles and still striving to diversify its economy despite a sharp decline in the jobless rate over the past seven years.

With recreational vehicle purchases fluctuating with the state of the economy, local officials have tried to attract non-RV businesses in recent years, including an electric car company that went bankrupt and an electric truck venture that Obama touted in a later visit. But despite the general lack of success in attracting new businesses, officials say Elkhart County is now better positioned for the next economic downturn because many of its RV suppliers have become more diversified.

"It's easier to find companies that survived the recession and diversified than it is to find new companies that came in that are completely non-RV-related," County Commissioner Mike Yoder said.

He gave the example of Cleer Vision, an Elkhart company that makes windows and tempered glass. Rick Collins co-founded the business in 2003, focusing at first on making transit bus windows and then becoming an RV supplier. In 2009, Cleer Vision had about 40 employees and about 75 percent of its business came from the RV industry. Now it has nearly 300 employees and 60 percent of its business comes from the RV industry.

"It's our (tempered) glass operation that has really broken our dependence upon the industry," Collins said.

Elkhart County's unemployment rate spiked to 18.9 percent in March 2009, two months after Obama's initial visit. It was down to 3.9 percent in April of this year, according to the most recent jobless data available.

"Elkhart is in fact a symbol of the nation's recovery," White House spokesman Josh Earnest said.

Elkhart is still heavily dependent on manufacturing, which includes RV companies and their suppliers. In April 2006, Elkhart County had a workforce of 133,500 people and 66,300 of those, or 49.6 percent, worked in manufacturing. By April 2009, employment had fallen to 96,200 and manufacturing accounted for 37,000 jobs, or 38.4 percent. By this past April, employment was back up to 125,800 and manufacturing accounted for 57,900 jobs, or 46 percent.

Jerry Conover, director of the Indiana Business Research Center at Indiana University's Kelley School of Business, said the county has seen some growth in other areas, including health care and social services jobs, but that the RV industry is still dominant.

"So much of their economy is based on what is essentially a discretionary product," Conover said.

The Recreational Vehicle Industry Association, the industry's primary trade group, reports that 374,246 RVs were shipped in 2015, the most since a record 390,500 were shipped in 2006. That number dropped to 165,700 in 2009.

The RVIA projects RV shipments will total 396,400 this year, which would be an all-time high, and will hit 404,800 next year.

Mark Dobson, president and CEO of the Economic Development Corporation of Elkhart County, said the diversification of existing companies has made attracting new businesses less of a concern.

"I don't think we have the heartburn that we once did. We still have that urgency to keep moving forward, but not that heartburn that maybe it's a house of cards," he said.

Conover said diversity is always a good idea.

"It gives you better odds for weathering storms," he said. "Manufacturing accounts for a large chunk of jobs in Elkhart and that puts them in a vulnerable position."

Yoder said Elkhart County is in a better position today to try to attract new businesses.

"It's much easier to do it from a community that is economically viable and growing in affluence than it is from a community that's suffering high unemployment and appears to be dying to the outside world," he said.