Indiana’s latest population estimates suggest to business leaders that workforce availability in the state is not necessarily being shaped by population growth but by where people are choosing to move.
New analysis from the Indiana Business Research Center (IBRC) at Indiana University reveals that the state’s recent population gains are being driven by net migration rather than births exceeding deaths. That matters to employers because migration-driven growth tends to be more volatile, more uneven in different regions and typically more often tied to labor market conditions.
For companies competing for talent, the research could be a hard reality that the available workforce is all about geography.
Indiana’s population is now estimated at more than 7 million residents, according to modeling from the U.S. Census Bureau. That is up over 35,700 residents in 2025 from the previous year. But that growth is not evenly distributed. Gains are concentrated in certain metro counties, most heavily around Indianapolis. This leaves the more rural counties with a decline in working-age population. What does this mean for employers? The research suggests that labor pools are not just growing at different rates. Instead, they are physically relocating.
According to IBRC’s findings, 66 of Indiana’s 92 counties saw population growth in 2025. Hamilton, Boone, Hendricks and Johnson counties saw the largest share of in-migration. These areas already have a strong labor market as they are close to the Indianapolis economy. Meanwhile, parts of southern and southcentral Indiana are seeing out-migration, particularly among younger workers.
The IBRC analysis indicates that migration is the most significant source of growth, representing the net population change in the last few years. That shift is most likely a reflection of why people are moving to metro areas in the state. Some of those factors include more affordable housing, job availability and infrastructure for remote work flexibility.
For employers, there are several business implications of migration-led growth.
Even in a state that is showing population growth, employers in counties where out-migration is occurring may face difficulties in developing workforces due to not enough qualified people to fill the positions.
Employers in metro areas may have a reverse dilemma. They have access to more talent, but are met with labor competition, often driving up the cost of wages sought by talent. As wage pressure becomes localized to more metro areas, those in rural counties may struggle with retention rather than wage inflation.
For many employers, the driving factor in where to establish headquarters, relocate or expand a business is access to labor, rather than tax incentives or the cost of land to build a company. This dynamic could be problematic to some employers who may have to sacrifice initial savings or prime logistics locations just to ensure they have an adequate workforce.
As metro areas develop and the cost of living increases, employees seek affordable housing outside of those costlier counties. As a result, commute times increase and can present challenges. Employers may face higher tardiness from staff members, issues with weather for those commuting to work, or a higher demand for remote or hybrid schedules, which may not fit with the company model.
While an overall population increase is a positive trend for Indiana, a closer look at where the growth is happening is a major consideration for business leaders. An uneven distribution of those gains means that labor availability is segmented by geography and industries tend to develop in clusters, rather than economically benefit the entire state.
For business leaders, expansion plans, workforce strategies and company location are all affected. If the migration trend continues in Indiana, employers will be forced to make company decisions based primarily on what regions are seeing the most population gains.
