State manufacturing, logistics sectors score high marks

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Indiana’s manufacturing and logistics sectors are emerging from the economic downturn in solid shape, demonstrated by the “A” grades they both scored in the latest industry report card compiled by Ball State University economists.

The findings are part of a report released by Conexus Indiana, an industry group that promotes the state as part of Central Indiana Corporate Partnership.

A panel of experts, including Ball State Bureau of Business Research director Michael Hicks, discussed the results Friday morning during a manufacturing and logistics conference presented by Conexus and IBJ at The Conrad hotel downtown.

Indiana’s manufacturing employment has risen by 4.6 percent during the past year, while it’s dropped 2 percent nationwide, enabling the sector to repeat its “A” grade.

The state’s logistics industry improved from a “B+” to an “A,” marking a first for logistics in the four-year existence of the report card. The improvement was based on stronger infrastructure investment compared to other states, the report said.

“The decline in manufacturing is not merely overstated but misstated,” Hicks said. “Manufacturing firms are turning back to hiring in Indiana.”

Hicks pointed to a Friday afternoon announcement by Cummins Inc. as evidence. The Columbus-based engine maker said it planned to add 600 employees in a new office building in downtown Columbus, where it is headquartered.

The development is the third expansion in southern Indiana announced by Cummins in the past year. Once the new building is filled, in 2013, Cummins will employ nearly 3,000 workers in a two-block area of downtown Columbus, three times its local presence in 2008.

Also in Columbus, a $13.5 million center aimed at training workers to fill manufacturing jobs that are growing steadily more complex opened on Friday.

Indiana University-Purdue University Columbus will use the facility for its new bachelor's of science in mechanical engineering degree program. Purdue's College of Technology and Ivy Tech Community College will also offer a number of engineering, technology, and related courses in the facility.

The center could help improve the “C” grade BSU economists gave to the state’s work force, which they say is not prepared enough to meet the demands of the more complex manufacturing jobs.

“One in four jobs in this state is tied to manufacturing and logistics,” said Conexus CEO Steve Dwyer, who emphasized that more educational opportunities should be made available for Indiana workers who don't pursue a four-year college degree.

Roughly 200,000 people will enroll in Ivy Tech courses this year, including 88,000 who will take some classes online, said Susan Brooks, the college’s general counsel and a panelist at the Friday Conexus event.

She said Ivy Tech is increasing partnerships with employers to better educate workers.

“On the other side, we need employers to step up and push these adults to get that certification, or associate degree,” she said.

Indiana also scored “A” grades in Global Reach and Tax Climate categories, even before recent legislation that will improve the state’s corporate tax rate, Hicks said.

Legislators in the past session voted to incrementally reduce the corporate tax rate from the current 8.5 percent to 6.5 percent in 2015.

Besides Human Capital, other categories in which Indiana scored in the “C” range were Benefit Costs, Productivity and Innovation, Diversification, and Venture Capital.

Indiana received no “D” or failing grades.


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