Indiana tax revenue surpasses projections for May despite slight growth in unfilled jobs

IN Focus: Indiana Politics

INDIANAPOLIS — A new report from the Indiana State Budget Agency shows Hoosiers made and spent more money in May than projected, yet the number of unfilled jobs has grown.

The statewide data matches what some Indiana business owners are seeing. At Dawson’s on Main in Speedway, owner Chris Hill is having trouble filling some open positions.

“They’re kind of running on fumes right now,” Hill said of his staff. “They make good money, but you can’t keep throwing money at people and expect them to do well.”

According to a report from the Indiana State Budget Agency, the state’s sales tax revenue in May was 17% higher than expected and increased 39% since May of 2020.

Income tax collection was 37% above the state estimate and went up 178% since the same time last year, according to the report.

“The American Rescue Act, people getting dollars, those individuals who don’t sit on the money for the most part, but they are spending money,” said State Rep. Greg Porter (D-Indianapolis), who serves as a ranking member on the Indiana House Ways and Means Committee.

Data from the Indiana Department of Workforce Development shows the state’s labor force participation rate has held steady in 2021 at about 63%.

The number of job postings, which includes new and unfilled positions, has grown by about 6,000 since mid-April to more than 120,000 statewide, according to the department’s data.

“Talking to employers, the biggest problem we have right now is finding more workers, so that’s a great problem to have,” said Indiana House Speaker Todd Huston (R-Fishers).

The federal pandemic unemployment benefits in Indiana are set to end June 19. But not everyone agrees that will be part of the solution.

“There’s a lot of hope that will bring people back into the workforce, but we also need to do a better job of skilling up workers,” Huston said.

While Speaker Huston believes ending the federal unemployment benefits will help, Democrats argue it will hurt the economy.

“I think at this point it is payment,” State Rep. Greg Porter said. “Employers need to pay more.”

Meanwhile, some business owners are trying to stay optimistic.

“I’ve seen a lot of different things in 15 years, so I’m very positive that things will turn for the better,” Hill said.

Lawmakers estimate a roughly $3 billion surplus for Indiana this fiscal year, State Rep. Porter said, which is about $1 billion higher than the surplus in a typical year.

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