Study: Ind. Manufacturing Garners High Marks
Six years after the official end of the “Great Recession,” Indiana’s economy continues to grow, thanks in large part to robust expansion in the manufacturing sector. The 2014 Manufacturing and Logistics Report Card issued by Conexus Indiana, the state’s advanced manufacturing and logistics initiative, and Ball State University’s Center for Business and Economic Research (CBER), places Indiana among the nation’s elite in four important categories: manufacturing health, logistics health, tax climate and global reach.
For six consecutive years, Indiana has boasted A-level performance in manufacturing health and four consecutive years of earned ‘A’s in logistics industry health. Indiana continues to lead the nation with the highest share of manufacturing employment per capita and highest manufacturing sector income share of total income.
“Indiana’s growth in economic activity continues to be relatively robust,” said Michael J. Hicks, CBER director and Ball State economics professor. “The data are conclusive evidence of Indiana’s competitive edge in the post-recession economy, both in comparison with surrounding states and on the national stage.”
Indiana also maintained an ‘A’ grade for tax climate and is among the top 20% relative to other states for income tax, sales tax, unemployment insurance and property tax for fiscal year 2014. Global reach also earned an ‘A’ grade for the sixth consecutive year, although Indiana saw a slight decrease in export growth compared to 2013.
Indiana improved grades in human capital (‘D’ to ‘C-‘) and worker benefits costs (‘C-‘ to ‘C’). Indiana also improved its first-year retention rate for first-time degree/certificate-seeking students, but is still among the bottom 10 percent of states in terms of percentage population with a bachelor’s degree.
“While our human capital grade showed some improvement this year, Conexus Indiana and our industry and education partners continue to concentrate considerable effort in shifting our statewide focus to developing a workforce equipped with the middle-skills necessary to succeed in today’s advanced manufacturing and logistics industries,” said Steven Dwyer, president and CEO of Conexus Indiana. “The workforce component is essential not only to our continued success in these sectors, but to an even stronger and more stable statewide economy.”
This year’s annual report came with a companion policy brief addressing some of the most pressing workforce issues facing Indiana manufacturing businesses. “Manufacturing and Labor Market Frictions” examined the effects on Indiana’s labor market of the long-anticipated “baby boom” generation retirement.
“The most significant factor facing Indiana’s manufacturing employers is the aging of the workforce,” Hicks said. “The share of the workforce aged 55 to 64 has increased 71% since 1998 – from 9.8% to 16.8%. The entire economy is experiencing that transition, but it is much larger and more rapid in manufacturing.”
To view the full report click here.