Indiana is beating Michigan by attracting people, not just companies

• Indiana’s population has grown at more than twice the rate of population in Michigan 
• Indiana leaders have focused economic development on making communities more attractive to residents
• Michigan leaders are scrambling to find answers to reverse the state’s stagnant population

INDIANAPOLIS — In the 1980s, even the locals around Indianapolis referred to their town as India-no-place — a city that had no real identity, in the middle of a state known for the inferiority-tinged jingle, “There’s more than corn in Indiana!”

Today, there’s still a lot of corn, but there are also a lot of incoming moving vans. Indiana’s population grew at more than twice the rate of Michigan from 2010 to 2020.

And nowhere is that growth more apparent than Marion County, where Indianapolis is located, and the counties that surround it. While the population of Michigan’s largest metro area, Detroit, flatlined in the past decade, metro Indianapolis grew by a jaw-dropping 200,000 residents, roughly the equivalent of everyone in Livingston County.

Formerly sleepy farm towns on the outskirts of Indianapolis are seeing cornfields swallowed up by subdivisions and downtowns knocked down for mixed-use buildings. Some down-on-their-heels neighborhoods in the city are being gentrified by the young, college-educated families Michigan is desperate to attract.

As Bridge Michigan reported in May, Michigan ranks 49^th in the nation in population growth, a dangerous trend that impacts the state’s economy and its ability to maintain services for an aging population. It’s part of the reason there is a hobbling worker shortage in the state, and why businesses are hesitant to expand within Michigan borders.

Earlier this year, Gov. Gretchen Whitmer appointed a commission to study Michigan’s population crisis. Recommendations are expected within months. That commission could do worse than to turn its eyes to our neighbor to the south for tips.

‘Used to be Podunk’

Steve Rupp points at new buildings as he steers his BMW X7 around one of the 142 roundabouts that circle Carmel, an affluent suburb on the north side of Indianapolis. The city and some surrounding communities replaced almost all their traffic signals with roundabouts a few years ago to improve traffic flow. In a 45-minute tour of the area, he doesn’t hit one traffic light.

“That building went up three years ago,” says Rupp, a real estate agent and board chair of the Westfield Chamber of Commerce, a community adjacent to Carmel. “There was a strip mall there before.

“That building,” pointing a block down at a multi-story brick structure, “went up last year. There used to be an Arby’s there.”

Rupp curves around another roundabout and points to new downtown condominiums, where a friend recently sold a top-level unit with a swimming pool for over $1 million.

Hamilton County, where Carmel and Westfield are located, grew 26 percent from 2010 to 2020. It’s one of three suburban Indianapolis counties that exploded by more than 20 percent in that decade. By comparison, Michigan had only one county with double-digit growth in that span — Ottawa County, at 12 percent.

Michigan has a larger overall population than Indiana (10 million, versus 6.85 million), but the two states are growing at a far different metabolism. 

Since 1990, Michigan has grown 8.4 percent, while Indiana has jumped 22.4 percent.

If Michigan had grown at Indiana’s rate just since 2010, it would have 270,840 more residents today, the equivalent of adding an extra Grand Rapids and Kalamazoo.

Related:

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• College grads: We left Michigan for jobs. Moved here for family, nature
• What Michigan can learn from booming Columbus, Ohio

Indiana is actually growing slower than the U.S. average (34 percent since 2010). All of the states that are sometimes derisively referred to as the “Rust Belt” have grown at rates below the national average since 1990. But among them, Michigan is the worst of the bunch, and Indiana is, comparatively, a superstar.

One reason: the median Hoosier (age 38) is two years younger than the average Michigander (40), which means more of them are having babies. Short of discovering a Fountain of Youth in Escanaba, there’s not much Michigan can do in the short term to reverse its aging population trend.

But there’s another data point that separates Michigan from Indiana that is of keen interest to Michigan leaders scrambling to address the state’s population problems:

More people are moving to Indiana from other states than moving out. That gain — 25,000 since 1990 — seems modest. But over that same time span, Michigan lost over 1 million people to net domestic migration.

Indiana has, in effect, found a way to put its finger in the population dike, while Michigan hasn’t.

Rupp continues his tour into nearby Westfield, which still has the remnants of an old downtown, but with a gleaming new public library under construction thanks to the additional property taxes of new residents. The downtown is surrounded by former cornfields that now feature three-car garages. Rupp pulls into a cul-de-sac where four homes are under construction. One sports a sold sign, planted in squares of grass sod that have yet to take root. Bushes near the front door still display tags from a nursery.

 “It used to be, companies would locate where they had the best tax rates and they’d draw employees. Now, companies look to where people want to live. And people want to be here.”

— Steve Rupp, Indiana real estate agent

All new subdivisions in Hamilton County must be connected by trail or sidewalks to surrounding neighborhoods, Rupp said. Trails have become a major selling point for the county and the entire Indianapolis metro area. Many communities have converted abandoned railway lines to trails that in turn connect to other trails. The most famous is the Monon Trail, which traverses 27 miles from northern Hamilton County to downtown Indy, with others feeding into the Monon like tributaries.

Surveys show young adults value walkability as a priority in choosing where to live. More and more, young adults are choosing the kinds of places they would like to live and then finding jobs, as opposed to checking Zillow after accepting a position.

Which is why it’s important for Michigan to be able to compete for young professionals, said Lou Glazer, president of Michigan Future, a think tank that promotes a knowledge-based economy.

“We get younger and more educated,” Glazer said of Michigan’s future, “or we get poorer.”

Through a combination of geographic luck — Indiana sits as a convenient crossroads for transportation across the country — and an economic refocus on sprucing up communities (what consultants call “placemaking”), a state without the coastlines of Michigan is blessed with has made itself more attractive to new residents 

“All of this is new in the past 10 years,” Rupp said, continuing his drive past subdivisions. “All these donut towns (surrounding Indianapolis) used to be Podunk. Now, all of these places have become destinations.”

Attracting new residents has become the primary economic driver for the region, Rupp said. “It used to be, companies would locate where they had the best tax rates and they’d draw employees,” he said. “Now, companies look to where people want to live. And people want to be here.”

Talent first, business second

Michigan still has some advantages over Indiana. Indiana has a slightly lower median household income (Michigan at $63,498 and Indiana at $62,743), and a lower percentage of adults with a bachelor’s degree or higher (32.1 percent compared to 29.6 percent). Yet time and again, people choose Indiana, and businesses follow.

Adam Berry, vice president for economic development and technology at the Indiana Chamber, told Bridge Michigan he believes state decisions about how to invest in economic development help boost population gains. 

In 2021, the state launched the Regional Economic Acceleration and Development Initiative (READI) to direct money for community placemaking. The state spent $500 million on projects that required local matching dollars. All told, Berry said, that $500 million turned into $12.2 billion in combined state, local and private funding for projects ranging from cleaning brownfields to building parks and trails around the state.

An example: There is a Toyota manufacturing plant in Princeton, Indiana, near the southwest corner of the state that abuts Kentucky and Illinois. “People who work there could live in any of those states, so what could I do to have amenities in Indiana that would attract people who already have a connection here but have not taken the leap to move here,” Barry said. 

“There’s a $50-million grant that with matches (turned into) $200 million to build those amenities,” which include a new YMCA and apartment complex in Princeton.

Barry said when he worked in economic development in the administration of then-Indiana Gov. Mike Pence a decade ago, the focus was on attracting foreign companies to move to Indiana. Today, the goal is attracting talent.

“We still want to make Indiana attractive to foreign direct investment,” Berry said, “but there needs to be increased focus on talent attraction and companies that are already here, the small and mid-sized companies. What can we do to incentivize them to invest in themselves and grow?”

Trails and smoothies

Another example of Indiana’s population metamorphosis sits just northwest of Indianapolis in the town of Brownsburg, which has gone in a few years from one stoplight to three Starbucks, with a fourth shop under construction along Ronald Reagan Parkway. The downtown, devastated over decades by fires and closures, has been transformed by two- and four-story mixed-use brick buildings. There is a Chicago-themed restaurant, and an eatery serving coffee, smoothies and bowls of “super food” with acai and chia pudding.

Chase Cotton ordered a smoothie and sat down to talk about how the community has changed since 2018, when the first buildings of the “new downtown” opened.

“We have incredible amenities,” said Cotten, a Purdue University graduate who moved to Brownsburg a few years ago with his wife and young daughter. “(We have) one of the best school systems in the state. Our parks are great. We have good local businesses and restaurants, and movie theaters are still in business. You know, it's like the types of things that make a community feel like it’s thriving.” 

Brownsburg has grown 36 percent since 2010, with a population now surpassing 30,000, and almost all of those new residents are the college grads Michigan is trying to attract. According to U.S. Census data, of the adults who moved to this former farming town between 2011 and 2021, 77 percent had a bachelor’s degree or higher. In those 10 years, median household income skyrocketed from $65,923 to $93,147.

Throw a smoothie in almost any direction in metro Indy and it’ll land near a bike and walking trail. There is a tree-lined paved bike trail that meanders eight miles from Brownsburg to the western outskirts of Indianapolis, and the Monon Trail wandering through the northern suburbs to downtown. There is a cultural trail that circles downtown, several trails that run through the Mass Ave. Cultural Arts District, and another that connects to the quickly gentrifying Fountain Square neighborhood.

Fountain Square is close enough to hear the rumble of semi-trucks running east-west and north-south along the freeways that dissect the city. The neighborhood is filled with hip restaurants and bars and a mix of modest older homes and new houses built on tiny city lots. Dumpsters brimming with construction material are as common as Teslas, and young couples walk dogs and push baby strollers.

Trevor Langston, pushing his young son in a stroller, pointed to a home that recently sold for over $1 million. The Oklahoma native and his wife moved into the neighborhood four years ago, and he said they expect to stay there until they can afford to “move up north” to the Carmel area. 

Downtown revitalization in Fort Wayne

Indiana’s growth extends beyond Indianapolis.

Take away metro Indy and, since 1970, the rest of Indiana still grew at a faster rate (20 percent) than Michigan (13.5 percent).

Between 2010 and 2020, 43 of Indiana’s 92 counties gained population.

One prime example is Allen County, home to Fort Wayne, the state’s third-largest metro. The county grew 8 percent in that decade, the city grew 4 percent.

In recent years, Fort Wayne has also focused on attracting people, not just companies. 

The city suffered more exits than arrivals through 2015, said Ellen Cutter, chief economic development officer at the Fort Wayne Chamber of commerce.

“We had slow and steady growth, but the hole in the bucket was losing more people than we were able to successfully attract from other communities,” Cutter said

That trend has turned around since 2015, following downtown revitalization.

A moribund downtown dominated by banks and attorney offices has been revitalized with a minor league baseball stadium, parks that take advantage of the city’s three rivers, and investment in condominiums, apartments, entertainment and restaurants that bring people to the area.

The city invested in alley and sidewalk improvements, and there was $1.3 billion in private investment downtown.

“In a 2019 survey, 90 percent of Allen County businesses said downtown revitalization was what helped them attract and retain talent, ranked above schools and public safety,” Cutter said. “It’s not something that’s nice, it’s something that’s necessary.”

One business leader who helped lead the push is Scott Glaze, CEO of Fort Wayne Metals, which specializes in the manufacture of metal for medical devices. About 20 years ago, Glaze and a group of entrepreneurs visited Greenville, S.C., to see how that community turned around its downtown. Glaze came back to Fort Wayne and “bought the ugliest building downtown and opened an Irish pub.”

Others followed. “All the businesses used to be on the fringe (of town),” he said. Now, “people go to the (baseball) game, then wander around downtown.

“There was a lot of city seed money” to help entrepreneurs revitalize, Glaze said. “There are several (construction) cranes downtown now. You would have never seen that 20 years ago.”

Glaze’s business has expanded in recent years, something he attributes partly to Fort Wayne’s ability to attract talent.

“We have strong internship programs, and every summer, we take our 40 to 50 interns to events downtown and show them around,” Glaze said. “Even if we can’t retain them, we want them to care about the area.”

Aiding that effort to connect with young professionals is a chamber-sponsored effort called Young Leaders of Northeast Indiana. Justin Hayes, former president of the organization, said the group works to increase “stickiness.” 

“We want you to get involved in something you’re passionate about, whether that’s the Humane Society or one of the 300 nonprofits we have in the area,” Hayes said. “Once they become connected in some capacity in five ways, they’re more likely to stay.”

Finding formulas for success

Matt Kinghorn, senior demographer at the Indiana Business Research Center at Indiana University, acknowledges that Michigan has some disadvantages that hamper growth.

First, it is a peninsula — few people travel through Michigan on their way to someplace else. Second, Indiana has the intersection of two of the largest interstates in the nation running through downtown Indianapolis — I-70, running east-west from Baltimore to Utah, and I-65, running north-south from Chicago to the Gulf Coast.

“Some of the forces driving change are so large, it’s hard to think of (any state) policy that will turn the tide” in Michigan, Kinghorn said.

Glaze, the Fort Wayne businessman, suggests Michigan leaders travel to successful communities to see what ideas they can steal, like Fort Wayne did 20 years ago.

“Each city has its own formula for success,” Glaze said. “Take back some wisdom from those cities.

“And another thing: Encourage your city to be open to entrepreneurs, encourage investment,” Glaze said. “Some cities get incredibly bureaucratic; they have rules and will defend them to the death. Be flexible.”

Langston, the young father living in Indianapolis’ Fountain Square neighborhood, had this blunt advice: Pay people to move to Michigan.

He pointed to a new program in Tulsa, Okla. Tulsa is paying workers who can work remotely $10,000 to move there for a year, making a bet many will decide to stay. More than 2,000 people have taken Tulsa up on the offer, which is funded by the George Kaiser Family Foundation, which is based in the city.

Justin Hayes, who works in economic development for a regional bank in northeast Indiana, recommends including young people in discussions about how to attract young families. (The first selections to Whitmer’s population commission looking for ways to retain and attract young people included just one person under age 40.)

“If you have an older demographic making all the decisions, they’re not trying to engage the next generation,” Hayes said. 

“When It comes to the way this generation looks at things, they’re not looking for a job, they want to find a place to truly live.”

Mike Wilkinson contributed to this report.