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Why President Obama can’t get enough of this small Indiana town

James Kruis grew up on the factory floors of his family’s molding and plastics business in Elkhart, Indiana, the city that President Obama says represents “the story of America’s recovery.”

At age 10, Kruis rummaged through the trash bin for wrongfully discarded parts. As a teenager, he worked the night shift with his brother, Jeff, producing television components that shipped south to an assembly plant in Marion, Indiana. They learned to love building things with their hands.

Now, four decades later, the brothers run Kruis Molding and Engineering, the same company their family founded in 1958, and Indiana Plastics. They learned “many years ago to be cautious and conservative,” said James Kruis, 52. “Our parents ran the business the same.”

In 2009, for the first time, the family business saw a 12 percent drop in sales. The Great Recession was shaking the nation’s economy. But they tried not to panic.

“Everybody was saying, ‘It’s not going to bounce back.’ I always thought we go through these downturns, and it comes back again,” Kruis said. “You’re going to have the highs and the lows.”

Elkhart was the first city Mr. Obama visited as president in February 2009, and he has kept an eye on it ever since. On June 1, he returns to the Midwestern town for the fifth time to speak at a local high school and answer questions at a town hall meeting with PBS NewsHour’s Gwen Ifill.

“Today, Elkhart’s manufacturing industry is back, and the town has regained nearly all of the jobs it lost during the downturn,” President Obama said, according to a recent White House-released statement. “The unemployment rate is lower than it was before the recession, and lower than the national average. In Indiana, more people have health insurance, and few homeowners are underwater.”

But the data paints a slightly more complicated picture.

Source: Pew Research Center Analysis of Census Bureau Data

Rakesh Kochhar is in the business of exploring downturn and recovery. An economist and associate director of research at Pew Research Center, Kochhar analyzed Census data from 2000 and 2014 to better understand how the middle class in 229 U.S. metropolitan statistical areas grappled with the Great Recession. He found that middle-income households in 203 of these areas still haven’t recovered since the recession began.

Part of Kochhar’s analysis included what happened in Elkhart-Goshen, Indiana, where, in March 2009, a staggering 20-percent unemployment rate rattled the region. The manufacturing sector alone — which made up 56 percent of the area’s gross domestic product — lost 24,000 jobs, he said.

In many respects, Elkhart and nearby communities rebounded, and by 2014, they were among the nation’s top 10 spots for middle-income households. Today, it boasts a jobless rate below 5 percent with 19,000 jobs back in manufacturing, which once again supports about half of Elkhart’s output. But had the Midwestern town truly risen unscathed from the Great Recession?

When Kochhar dug deeper into the data, he found something interesting. He looked at how many adults reported being in upper, middle and lower income levels, and, at first glance, data snapshots captured in 2000 and 2014 resembled each other. But when he explored household income data, he found that the average take-home pay in Elkhart-Goshen had dropped 22 percent — down from nearly $74,000 in 1999 to almost $58,000 in 2014.

Source: Pew Research Center Analysis of Census Bureau Data

“There’s been a significant hit on incomes,” Kochhar said. “Jobs have remained, but they are lower wage.”

Kruis didn’t say his family’s business cut wages, but he did say they slashed the prices of equipment they sell to farmers, physicians and musicians to “become more competitive.” They have diversified the products they make and don’t want to pigeonhole themselves the way Elkhart’s recreational vehicle industry did, he said.

In 2010, Elkhart built 60 percent of the nation’s RVs, trailers and pop-up campers. But when the Recession hit, household budgets tightened nationwide, and demand for these luxury items sank, said Elkhart Mayor Tim Neese.

Kruis said during the years immediately following the recession, business remained profitable and gained more customers,but it did so at lower profit margins.

Today, Kruis says he feels optimistic about the factory’s future. Still, he has a handful of engineering jobs that he’s struggled to fill. And he laments that most people in the United States no longer get excited about manufacturing.

“We teach our kids that they have to be excited about being on a computer, not on a bench grinding steel or producing a part,” he said.

Learn more about the people of Elkhart and their thoughts on the state of the nation at 8 p.m ET, Wednesday. Watch “Questions for President Obama: A PBS NewsHour Special” hosted by Gwen Ifill on your local PBS station and online.

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