Bubble Bursting in Lincoln?

The Street (via Yahoo Real Estate) recently took a look at five places where they speculated that an economic bubble might burst, affecting the otherwise relatively stable real estate and employment markets. First on the list was Lincoln, Nebraska, which they said might be vulnerable, “if higher education costs ever find a ceiling.” The problem with their analysis is that costs at the University of Nebraska have not risen at the same pace as counterparts elsewhere, and are still a good bargain. This is especially true for in-state students, the biggest share of the University’s recruiting pool. So, even if higher-education costs reach a settled peak, it’s not clear that this would have a severe effect on Nebraska’s schools. The University already has faced several rounds of budget cutting over the past decade, as state appropriations have shrunk and health-care costs for employees spiral out of control. Even so, they continue to be a stable, large-scale employer in the area.

If Lincoln is vulnerable, it might be because of general difficulty attracting or retaining major employers in pace with the city’s growth, or to weakness in the industries of large employers like Crete Carrier, Kawasaki, Goodyear, or various insurance companies.


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