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Local MSA shrinks, but does it matter?

November 11, 2018

The Fort Wayne MSA just got smaller : not that you might have noticed.

Those three initials may not mean a lot to many area residents. But to economic policy wonks, government planners and key business people, the term MSA is part of everyday language.

MSA stands for Metropolitan Statistical Area : and a recent federal change that eliminates one of the counties that is a part of Fort Wayne’s caught area statistics experts off guard. 

Since 2003, Fort Wayne’s MSA has comprised three counties : Allen, Wells and Whitley : and more than 425,000 people. But now, according to a document issued in September by the White House Office of Management and Budget, Wells County and its approximately 28,000 residents have been lopped off.

That means the Fort Wayne MSA’s population has dropped about 7 percent to about 400,000 residents. The change also will likely drop the area’s ranking on the list of the nation’s 384 MSAs.    

Rachel Blakeman, director of the Community Research Institute at Purdue University Fort Wayne, said the change will likely make using MSA data in the next few years “kind of confusing.”

A staff member discovered the change “by coincidence,” she said. 

Little wonder, said Ellen Cutter, vice president of marketing, research and strategy for Greater Fort Wayne, which uses MSA information in marketing the region.

“It’s a 227-page document,” she said of the federal bulletin containing the change, which is listed on page 52 without explanation.

Cutter said to her knowledge, local government or community leaders weren’t specifically notified of the change : or consulted in advance. How the decision was made, she said, was outlined in a June 28 document containing standards. But how the standards were applied, and when they will take effect in the various ways in which they are used, remains a bit of a mystery.

“What I do know is they base the MSA definitions largely on commuting patterns and more broadly on shared social, demographic and economic characteristics,” Cutter said. 

An MSA traditionally has been defined as a region with a core area with a high population density, typically a city, and outlying areas with close economic ties. MSAs don’t need to correspond to a governmental or geographic unit, although some may follow those lines.   

Tom Guevara, director of the Public Policy Institute at Indiana University, said the Fort Wayne MSA change may be because fewer people are commuting from Wells County to work in Fort Wayne and Allen County.

He said one standard : an opinion survey of commuting patterns : was dropped for the new MSA determinations, and that might have influenced the Fort Wayne MSA’s status. The change may have been based more on observable data than people’s opinions, he said.

Also, recent economic development growth in Wells may have been a factor. In the past few years, Wells has attracted more larger employers, according to Chad Kline, executive director for the Wells County Economic Development Corp.

The county has had about $58 million of increased industrial development and a commitment of 128 jobs just in 2018, including two large manufacturers and seven business expansions, he reported.   

Fort Wayne’s MSA has been adjusted multiple times since the early 1970s. “It’s not that the government is out to get us,” Blakeman said.

In 1972, Fort Wayne’s MSA consisted of only Allen County. In 1973, Adams, DeKalb and Wells counties were added. Ten years later, Adams and Wells were removed, but Whitley was added.

Ten years after that, Adams and Wells were added back and Huntington County joined. That grouping remained until 2003, when the Allen-Wells-Whitley configuration came into being.

The many shifts mean it’s often been hard to compare the area’s MSA statistics across time, but it has been easier since 2003, area experts said. Now, that will again be more difficult.

For example, if one is looking at the Fort Wayne MSA’s per-person income statistics or unemployment rates or even educational attainment levels in 2008 and 2018, it’s no longer possible to see if they’ve gotten better or worse in the proverbial apples-to-apples way.

“It’s more like comparing apples to parts of apples,” said Michael Galbraith, director of the Road to One Million initiative of the Northeast Indiana Regional Partnership. “I think we may have to have an asterisk (by results) if we’re doing that kind of long-term look now,” he said, and those less familiar with the area and MSA statistics might get tripped up.

MSA statistics can still be compared across time, Galbraith added, but statistics would have to be extracted from earlier data by county and numbers from Wells discarded. 

Fort Wayne has never been in the Top 100, a status coveted by many communities, area experts said. The Fort Wayne MSA currently ranks 125th.

Blakeman said her estimate is that the MSA will fall a few spots to 133rd, the spot now held by Salisbury, Maryland. But the actual ranking depends on what changes were made to other MSAs, she said.

The ranking could affect how attractive the area appears, especially to outsiders. For example, as Amazon has looked for places to locate its new headquarters, MSA size was a qualifying factor, Blakeman said. 

“It looks like we’ve suddenly lost 28,000 people from our MSA,” she said : not exactly a sign of a healthy community.

Decisions often based on MSA statistics include whether retailers locate or leave the area, how much money is spent on media advertising and how affordable housing prices are, Cutter said.

“Every industry I can think of is a consumer of some area of Metropolitan Statistical Area information,” she said. 

Because the difference between the old and new MSAs is in the single digits, impacts on specific statistics should not be overly large, Cutter said.

“What is going to happen is that ... some measures are going to overperform and some are going to underperform,” Blakeman said. In other words, some aspects of the region might look relatively better or relatively worse.

“For example, Wells has wages under the state average, so in theory, that (dropping Wells) is going to bring wages up in the MSA,” she said.  “But if you see (statistics showing) wages going up in the next year, it may not be that wages are (actually) going up, but the change (in the MSA).”

Still, MSA statistics are not the only way the Fort Wayne area is measured,  Cutter said.

“We consider our region to be 1.5 million people living within an hour drive of Allen County,” she said, pointing out that the area includes portions of Ohio as well as northeastern Indiana counties.

And, these days, with more internet access to data and more sophistication in using it, MSA data, while still important, doesn’t hold sway in the way it once did, said Galbraith, adding the partnership looks at the region as much more than two : or even three : counties.

“My immediate reaction is that other counties are still part of our region ... when we’re looking how the economy works,” Galbraith said.

The MSA is “just the way they (at the federal government) measure.” 

rsalter@jg.net

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