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Report: RVs Help Rise in Indiana Manufacturing

August 5, 2013 by · Leave a Comment 

For the second year in a row, industrial employment in Indiana posted a gain, according to the “2013 Indiana Manufacturers Directory,” an industrial directory published annually by Manufacturers’ News Inc. (MNI) Evanston, Ill. MNI reports Indiana gained 8,020 manufacturing jobs from April 2012 to April 2013 or 1.4%.

Manufacturers’ News reports Indiana is now home to 9,698 manufacturers employing 556,357 workers.

“Indiana’s industrial climate continues to improve,” says Tom Dubin, president of MNI, which has been surveying industry since 1912. “The state’s reasonable labor costs, friendly business environment, and ideal location for the shipment of goods has resulted in many companies reinvesting in its manufacturing sector, particularly those in the automotive and transportation equipment industries.”

According to the industrial directory, transportation equipment, including recreational vehicles, ranks first in the state for manufacturing employment with 81,567 jobs, up 4.7%. Industrial machinery and equipment ranks second with 69,866 manufacturing jobs, up 1%, while fabricated metals accounts for 55,491 jobs, up 1.2%.

Additional industrial sectors in Indiana that posted gains in employment included instruments/related products, up 5.9%, furniture/fixtures, up 4.9%, and lumber/wood, up 2.6%.

Northeast Indiana accounts for the most industrial employment in the state with 144,494 industrial workers, up 2.1%. The East Central region of Indiana accounts for 140,472 jobs, up a half percent over the past 12 months, while the Northwest region accounts for 88,945 jobs, down a half percent. Southwest Indiana saw manufacturing employment increase 3.2% and represents 72,561 of the state’s jobs, while jobs increased 2.4% in Southeast Indiana, with the region currently home to 57,965 industrial workers. West Central Indiana accounts for 51,920 manufacturing jobs, up 2%.

MNI’s city data shows Indianapolis remains the state’s top city for manufacturing employment, home to 73,527 jobs, down a half percent over the survey period. Second-ranked Fort Wayne is home to 25,629 jobs, up 1.7% over the past 12 months. Industrial employment in Elkhart increased 3.2% over the year, with the third-ranked city currently home to 23,259 jobs. Evansville accounts for 16,379 jobs, down 1.6%, while Lafayette is home to 14,274, virtually unchanged over the year.

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Report: Ind. Has Rapid Manufacturing Rebound

June 18, 2013 by · Leave a Comment 

Reflecting a “key period” in the post-recession transition, the sixth annual Manufacturing and Logistics Report Card shows Indiana outpacing the nation in the industries’ rebound.

According to Inside INdiana Business, the report, issued by Ball State University’s Center for Business and Economic Research (CBER) and the state’s advanced manufacturing and logistics initiative Conexus, Ind., stated that only six states are “recovering,” and Indiana is leading the charge. Indiana is home the RV industry’s manufacturing center.

“This study argues for an unusually strong recovery period. Most of the country’s manufacturing has not rebounded effectively,” said Michael Hicks, report author and CBER director. “Indiana’s post-recession recovery is third best in the country behind only Alaska and North Dakota. Those states are so small relative to Indiana’s manufacturing, I think it could be said, of the real manufacturing states, Indiana is recovering most rapidly.”

Hicks says the 2013 report reflects the state’s continuing dominance in manufacturing and logistics. Indiana received an “A” in manufacturing industry health for the fifth consecutive year, and logistics industry health has improved from a “B-” in 2009 to earning its third consecutive “A” this year.

Indiana also received an “A” in tax climate and in global reach, which measures the export of goods. Additionally, the Hoosier state leads the country with the highest share of manufacturing employment per capita.

Indiana earned an average “C+” score in productivity and innovation. Hicks noted that although the struggling national economy would suggest stalling productivity, manufacturers are making more goods with the same number of people and level of capital investment.

“The really good news is, throughout the Midwest, Indiana is leading that productivity level and growth,” says Hicks. “We rank 16th nationwide, but we’re doing a very good job amongst more comparable states in the Midwest.”

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Report: Manufacturing Drives Hoosier Economy

January 22, 2013 by · Leave a Comment 

A survey by the U.S. Commerce Department highlights the importance of manufacturing jobs to the Indiana economy.

According to a press release, results indicated jobs in the sector accounted for at least 20% of total earnings in 50 of Indiana’s counties in 2010, which is the most among all states. Elkhart County, home to the RV industry’s manufacturing hub, was included in that listing.

Indiana was followed followed by Ohio (48 counties), Tennessee (42 counties), Wisconsin (40 counties), Georgia (36 counties), Iowa (36 counties) and Kentucky (31 counties).

Nationwide, the manufacturing sector added roughly 500,000 new jobs from the beginning of 2010 through the end of 2012, and contributed more than 25% of the overall growth in gross output between 2009 and 2011. Today’s report finds that nearly all states include some counties where manufacturing accounts for a significant share of jobs and earnings.

“The Geographic Concentration of Manufacturing Across the United States” study uses smaller geographic areas to find where manufacturing matters most to a local economy. It finds that such counties are concentrated in the Midwest and the South, are more likely to be outside metropolitan areas, and are relatively small.

“The report we are releasing today is an important lens to better view the geography underlying manufacturing in America,” said Acting Secretary Rebecca Blank. “Not only is it a key economic sector, but manufacturing jobs often carry higher wages and provide better benefits than non-manufacturing jobs.”

There were 181 counties spread over 27 states where manufacturing jobs made up at least 20% of total employment.

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Survey: Hoosier OEMs Shaking Off Recession

December 6, 2012 by · Leave a Comment 

The results from the 2012 Indiana Manufacturing Survey indicate that Hoosier manufacturers are stronger this year than at any point since the Great Recession, according to a press release.

“Indiana’s manufacturers have clearly recovered from the Great Recession and are now investing for growth,” said Mark Frohlich, associate professor of operations management at the Kelley School of Business in Indianapolis, who presented the results with Steven Jones, associate professor of finance at Kelley. “They are stronger this year than we’ve seen in recent years and ready to compete with the best that there is.”

This study of small- to medium-size manufacturing companies was commissioned by Katz, Sapper & Miller and developed in partnership with the Indiana University Kelley School of Business Indianapolis, Conexus Indiana and the Indiana Manufacturers Association.

Other key findings reveal:

• Hoosier manufacturers have largely shaken off the effects of the Great Recession and have stabilized their businesses. A significant majority of Indiana’s manufacturers now report that their businesses are either “healthy” or “stable” with tougher times behind them.

• Survey results indicate that the past’s relentless rounds of downsizing are over, and while that approach worked well when mere survival was paramount, it is hardly a winning strategy for the future.

• Many Hoosier manufacturers now recognize that the winning strategy is targeted investment aimed at growth. More than 70% of respondents reported their goals are increasing investment in areas either essential for revenue growth or across the entire business.

• Indiana remains well positioned to lead American manufacturing. Hoosier manufacturers are highly competitive in a broad variety of industries and products, and, in fact, one in 10 of the companies in this survey are planning to open a new facility in Indiana in the near future.

• A significant number of respondents report that they are on-shoring manufacturing back to the United States. Indiana’s competitive advantage remains. Nowhere else in America allows manufacturers to position themselves closer to their customers and markets or offers greater advantages in terms of suppliers, workforce quality and transportation.

• Successful manufacturers are continuing to rely on process improvement programs such as Lean and Six Sigma for implementing change, as well as increasingly taking advantage of advanced automation or smart manufacturing technologies to remain competitive.

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Study: Indiana Manufacturing Fueling Recovery

June 21, 2012 by · Leave a Comment 

Indiana’s legacy of building products is fueling the state’s economic recovery, according to the 2012 Indiana Manufacturing and Logistics Report Card, a partnership between Conexus Indiana and the Ball State Center for Business and Economic Research (CBER).

Inside INdiana Business reported that the study shows Indiana, home to the RV industry’s manufacturing hub in Elkhart County, has the most manufacturing-intensive economy in the nation and ranks highest in manufacturing employment per capita. However, the fifth annual study echoes the same concern of previous report cards – Indiana must address human capital to ensure the health of two industries that collectively employ nearly one of every four Hoosiers.

“Everybody knows that manufacturing has done pretty well in Indiana; you don’t have to be an economist, you just have to read our job creation numbers over the past year or 18 months,” says CBER Director Michael Hicks, who authored the study. “This has been a very good time for manufacturing recovery in Indiana; the score card reflects the state still in a very high position nationally with respect to the overall strength of its manufacturing and logistics sectors.”

The report card, which compares Indiana to all other states, gave the Hoosier state the highest grade possible in manufacturing and logistics industry health, tax climate and global position.

“Hoosiers are doing very well competing in the global economy,” says Chris Watts, vice president of communications and research for Conexus Indiana, the state’s advanced manufacturing and logistics initiative. “We’re in the top ten in manufacturing exports per capita and number one in income derived from foreign owned manufacturers, so that shows we’re continuing our hot streak in attracting foreign direct investment.”

Not the state’s lowest grade – but perhaps of greatest concern– is the C- in human capital, a slight dip from C in 2011. The score is attributable to low rankings in adult population with a high school diploma, associate’s degrees per capita and adults with a four-year college degree. The Hoosier work force is of even greater concern as baby boomers near retirement age.

 

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Survey: Hoosier Manufacturing Gets Stronger

November 10, 2011 by · 1 Comment 

The certified public accounting firm of Katz, Sapper & Miller LLP today released the results of its annual Indiana manufacturing survey. As reported by Inside Indiana Business, the “2011 Indiana Manufacturing Survey: Performance, Practice and Strategy” indicated that Hoosier manufacturers are strong and getting stronger.

“This study has some of the most encouraging findings we’ve seen in years,” said Scott Brown, partner-in-charge of Katz, Sapper & Miller’s manufacturing and distribution services group. “It suggests that many Indiana manufacturers are once again investing in their businesses and holding their own against the competition. Such investments and improvements are the key to Hoosier manufacturers remaining successful.”

Other key findings reveal:

• A majority of Indiana’s manufacturers reported “healthy” or “stable” financial performance over the past two years. Equally encouraging, the waves of cost-cutting in recent years by manufacturers now appear to be rapidly receding, with less than 25% of survey respondents reporting cost-cutting as their strategy for future financial success. Additionally, 60% of Hoosier manufacturers reported that they are now increasing investments across the business and in areas essential for revenue growth.

• When asked about future financial priorities, the top three goals of Indiana manufacturers are: 1) improving cash flow and working capital management; 2) improving short- and long-term operational efficiencies; and 3) accessing credit for working capital. All of these strategies are designed to not only improve financial health but also help ensure survival in today’s demanding business environment.

• In terms of job growth for 2011 and beyond, 11% of survey respondents plan to open new manufacturing facilities in the next two years. Of those respondents, all favored Indiana over other locations due to Indiana’s workforce, central U.S. location and transportation network. Just as encouraging, 13% of respondents reported that they anticipate relocating or “onshoring” some manufacturing back to America in the next several years. Chief among those reasons cited were obtaining better control over production, closer proximity to major customers and markets, and reduced total “landed” costs.

The survey also revealed specific business, manufacturing and supply-chain strategies for manufacturing to be competitive. First, superior product design and customer service are keys to new growth. Second, smart manufacturing and process improvements lead to financial success. Third, supply chain integration is linked to better customer service and inventory control. Together, these findings suggest that the roadmap for successful manufacturing consist of:

• Crafting a business strategy that features superior design and delivery for new products as well as outstanding customer service for more mature goods.

• Picking a path in terms of manufacturing improvement. The strongest strategies are those featuring either advanced smart manufacturing technologies or process improvements (or both).

• Leveraging upstream suppliers and downstream customers in the supply chain. Since no manufacturing company operates in a vacuum, manufacturers working together with their customers, suppliers and transportation providers reported significantly better performance versus those that do not.

To view the complete results of the 2011 Indiana Manufacturing Survey: Performance, Practice and Strategy, visit www.ksmcpa.com/2011_indiana_manufacturing_survey.

 

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Indiana Manufacturing Aids Economic Rally

June 21, 2011 by · Leave a Comment 

The economic recovery may have stalled in parts of the South and West hit hard by the housing bubble, but Rust Belt states, buoyed by a manufacturing comeback, have seen a steady decline in their jobless rates over the last year.

According to a report from McClatchey Newspapers, of the 10 states where unemployment rates dipped the most from May 2010 to May 2011, Rust Belt states — Michigan, Indiana, Ohio, Pennsylvania and Illinois — account for half, according to Labor Department figures. Indiana is the manufacturing hub for recreational vehicles in the U.S.

Metropolitan areas in the five Rust Belt states accounted for 30 of the top 34 declines in regional unemployment rates since last year, as well.

While these industrial Midwest states and towns have made the biggest strides in reducing their jobless rates, their progress is limited. Many had some of the nation’s highest jobless rates during the recession, so their declines reflect not only more people finding jobs, but also the labor-market loss of older manufacturing workers who gave up the job search.

A recent national survey of 18,000 employers by the work force consulting company ManpowerGroup found that 20% plan to hire in the third quarter of this year, while only 8% expect to cut jobs.

But a whopping 69% expect to make no changes at all in their payrolls, suggesting “a level of caution not seen among employers in the last 30 years of data,” said a statement by Jonas Prising, ManpowerGroup president of the Americas. “This fact, along with many clouds still on the economic horizon, may explain the tepid labor market growth we have seen so far.”

Ironically, it’s the long-troubled manufacturing sector that’s fueling the nation’s anemic economic recovery. For years, industrial decline and globalization eliminated thousands of well-paying manufacturing jobs in the industrial Midwest. The recession doubled the pain as demand for manufactured goods plummeted, driving even more people out of work.

But as America’s auto industry rebounds and export demand for industrial and agricultural equipment remains strong, Rust Belt states are slowly coming back.

“That’s a huge change from ‘06, ‘07 and ‘08, when the automobile industry was in big trouble and shrinking,” said Steven Cochrane, the managing director of Moody’s Analytics in West Chester, Pa.

Cochrane said the excess of factory and building space, a skilled labor force and lower labor costs due to union concessions had made the Rust Belt attractive to companies looking to expand. “It’s no longer a no-brainer to look elsewhere,” he said.

In Elkhart, Ind., where production of recreational vehicles accounts for about half of the area’s economy, unemployment spiked at 18.9% in March 2009.

But over the last year, RV manufacturers and their suppliers began adding workers and hours in Elkhart, which posted the nation’s largest one-year decline in its area jobless rate, going from 14.1% in April 2010 to 10.1% in April 2011.

An electric car manufacturer from Norway, THINK, opened its North American assembly plant in Elkhart last year and plans to build 2,500 vehicles this year. The plant, in a former RV parts factory that went out of business, has more than 100 employees and is expected to create more than 400 area jobs by 2013.

“Elkhart hasn’t fully recovered by any stretch, but the rate of change” is promising, said Jim Diffley, senior director and chief regional economist at IHS Global Insight in Philadelphia.

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Study: Indiana Manufacturing on Record Pace

June 10, 2011 by · Leave a Comment 

Conexus Indiana and the Ball State Center for Business and Economic Research today (June 10) released the 2011 Indiana Manufacturing and Logistics Report Card, an annual grading of the strengths, challenges and opportunities impacting the two industries that collectively employ nearly one of every four Hoosiers.

According to a press release, this year’s Report Card confirms that Indiana’s strengths in making and moving products have buoyed the state’s economic recovery. Indiana continues to rank among the top tier of states in manufacturing and logistics employment, and Ball State economists predict that the next 12 months will be a record year for manufacturing in the state. Indiana’s manufacturing employment has risen by 4.6% since the end of the recession.

The study gives Indiana overall “A” grades in manufacturing industry (ranking first among states in share of the economy focused on manufacturing), logistics industry, global position (measuring manufacturing exports and foreign investment) and tax climate. The educational attainment of the Hoosier workforce, however, continues to be a long-term concern.

The state’s “C” grade in Human Capital is a step forward from last year’s C-, based on strong enrollment in community college programs and improved high school graduation rates. But Indiana’s adult population continues to rank among the least-educated in the nation, leaving Hoosier manufacturing and logistics firms struggling to find qualified applicants for jobs that demand increasingly advanced skills.

This year’s study reiterates that Indiana must do a better preparing the next generation of manufacturing and logistics workers, said Steve Dwyer, Conexus Indiana’s president and CEO, noting “today’s jobs aren’t about standing at assembly lines, they’re about running computerized equipment and robotic systems, about teamwork and problem-solving.”

He added, “We have to give introduce young Hoosiers to these careers early on, and give them opportunities to acquire the skills they need at all levels to create the pipeline of talent that manufacturing and logistics employers need to grow.”

Other key findings from the 2011 Indiana Manufacturing and Logistics Report Card:
• Indiana ranks second among states in per capita manufacturing employment and ninth in logistics employment.
• Indiana ranks first in per capita income derived from foreign-owned manufacturing operations, ninth in manufacturing exports per capita and 13th in export growth.
• Indiana scored a “C” in benefit costs, based on poor rankings in healthcare and fringe benefit costs.
• Indiana generally ranks in the top tier of states in terms of tax rates and the recently-enacted corporate income tax cut should bolster the state’s current ranking of 21st in corporate taxes.
• The state’s “C” grade in productivity and innovation represents a mixed-bag of indicators, with strong rankings in manufacturing productivity (ninth) and R&D investment (15th) offset by poor performance in patents-per-capita (32nd);
• With rankings of 31st in percentage of the workforce with a high school diploma or greater, 42nd in college-educated workers, and 26th in younger workers with a two-year degree, human capital remains Indiana’s biggest long-term hurdle to future manufacturing and logistics growth.

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