Last week, John Hawks wrote a very interesting piece (“Area business on upward trend”) on business growth here in Ottawa. Hawks does a great job going through the on-the-ground specifics of recent business growth. I thought I’d dig into some government data on Franklin County to expand on his article. First I’ll talk a little bit about the employment situation in the county, then move to poverty rates and food stamps. Finally, I’ll talk about Franklin County residents’ credit ratings and home prices in the county. If you’d like to see the graphs I refer to below, please check out http://bit.ly/ottawaeconomy
I’ve addressed Ottawa’s employment situation fairly recently, and things are still humming along quite well. The unemployment rate is still at historic lows and the labor force continues the growth it has had the last couple of years. Growth in the labor force has tracked pretty consistently with overall population growth in the county. This, combined with the low unemployment rate, indicates that most people who are looking for a job are able to find one. Certainly this is a good thing and is consistent with Hawks’ informative piece from last week.
Two reliable indicators of poverty are poverty line statistics and the number of people enrolled in the Supplemental Nutrition Assistance Program (formerly called food stamps). I could only find data on the percentage of the population below the poverty line since 2012, so I can’t say much about the 2009 Recession’s effect on this statistic. In 2017, roughly 12.4 percent of Franklin county residents earned income below the federal poverty line. This is relatively low compared with the percentage of the population below the poverty line in recent years. Roughly 13.5 percent of the population was below the poverty line in 2014 and 2016.
The food stamp data is much more informative. I found food stamp data going back to the 1990s, which allows me to talk about the aftermath of the recession, 2012, and where we are today relative to that. From 2003 to 2006, roughly 7.5 percent of Franklin County residents received food stamps. This number began to tick up after 2006 and by the official end of the Great Recession in 2009, roughly 12 percent of the population received food stamps. It continued to rise until 2012, peaking at nearly 15 percent. Since then, things have improved dramatically and, as of 2016 (the latest data I could find) roughly 9 percent of Franklin residents receive food stamp benefits. Given the improvement in the local economy since then, especially the continued decline of the unemployment rate since 2016, it is likely that this number is even lower now.
So far I’ve discussed factors that contribute to short-term financial security. Income and employment are important, but they fluctuate over time. Families can receive food stamp benefits for a time and then leave the program when their financial situation improves. Home values are more significant indicators of longer-term financial security. For Franklin County residents an appreciation in their home value does several things: decrease their risk of bankruptcy, improve access to credit for times of financial stress, improve their financial situation after retirement, and other benefits.
Before the recession, home values in Franklin County peaked around the year 2007. As the recession drew near, home values fell, ultimately bottoming out about 15% below the 2007 peak in 2014. Since then, home values have been rising and have surpassed the previous 2007 peak. While some economic commentators are worried about rising interest rates quashing home value growth, continued increases in business formation and a stable job market will likely keep Franklin County in a good place to continue the growth we’ve enjoyed the last few years!
Please join Gwartney Institute and Ottawa University faculty for an engaging discussion on important issues at “Ottawa Minds and Wine!” Our first event is Thursday, Feb. 7th at 5:15 p.m. at UnWined. We will have a brief 20 minute talk and will be around for discussion afterward.
— Levi Russell is a professor of economics at Ottawa University.