Where Indiana leads, too many workers don’t follow

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As Indiana competes with neighboring states for computer-chip and electric-vehicle production plants, some state leaders remain concerned that Hoosiers are ill-equipped to fill the jobs of the future should those corporations decide to locate here.

Indiana is a leader in the national advanced manufacturing and logistics sectors, yet employers continue to struggle to find candidates to fill open positions, according to a new report from Conexus Indiana, a statewide organization that supports and promotes Indiana’s advanced manufacturing and logistics industries.

Sam Charron

Workforce development is still the “top challenge” for many employers, said Sam Charron, director of government affairs for the Indiana Manufacturers Association.

“There’s still a big demand for more skilled workers, and that’s where the focus is for our members,” Charron said.

Labor economists attribute the nation’s labor shortage to a confluence of factors, including a surge in retirements since the pandemic, a lack of skilled workers and a dearth of affordable child care.

In Indiana, the volume of job postings for Industry 4.0 skills—artificial intelligence and machine learning, data visualization, cybersecurity, cloud computing, to name a few—is roughly on par with that of neighboring states, according to the Conexus study.

Manufacturing and logistics account for one in five private jobs in Indiana and nearly a third of GDP, making Indiana the most manufacturing-intensive state in the country. At the same time, the state’s industry turnover rate, which is the number of job separations compared with the number of jobs, was 50% in 2022. The turnover rate for the logistics industry alone was a staggering 85%.

Those rates are reason for concern because they are much higher than the nation’s rates, which stood at 39% for the overall industry and 70% for logistics, according to the U.S. Bureau of Labor Statistics.

Hoosiers make everything from automotive parts and jet engines to pharmaceuticals and electronic components. About one in four workers in these industries is at or near retirement age, increasing a sense of urgency for employers.

To inspire more Gen Z Hoosiers to enter these careers, Conexus launched a Make IN Move initiative that uses digital advertising and marketing campaigns on social media to tout the average salary for careers in the industries. The average total compensation for a manufacturing job, which includes wages and supplements, is $89,000; the average logistics job pays $67,000.

It’s part of an effort to ensure that younger generations are prepared for advanced manufacturing jobs that will become even more widespread in the next several years.

According to the Conexus study, the manufacturing subsectors anticipated to grow the most over the next three years are transportation equipment manufacturing, fabricated metal product manufacturing and machinery manufacturing. In the logistics industry, warehousing and storage are expected to see the largest growth, followed by truck transportation, and couriers and messengers.

In the works

Thousands of those kinds of jobs and billions of dollars of investment in advanced manufacturing are slated to come to Indiana, putting an even greater spotlight on the need for trained workers.

Since President Joe Biden took office in January 2021, Indiana has secured $7.6 billion in commitments from original equipment manufacturers, projected to bring 5,800 jobs, according to the White House.

The Indiana Economic Development Corp. is pursuing several advanced manufacturing projects that together would exceed $55 billion in investments and result in thousands of well-paying jobs.

Indiana is in the running for a $50 billion semiconductor plant, and an unnamed auto-parts maker is considering the state for a $3.2 billion manufacturing facility in north-central Indiana, according to IEDC officials. State officials are also courting a $3.2 billion data-center project.

Other projects are already in the works. Minnesota-based semiconductor manufacturer SkyWater Technology is building a $1.8 billion R&D and production plant adjacent to the Purdue University campus in West Lafayette. Amsterdam-based automaker Stellantis is constructing a $2.5 billion electric-vehicle battery plant in Kokomo, and General Motors is partnering with South Korea-based Samsung SDI to build a more than $3 billion EV battery-cell plant in northern Indiana.

Indianapolis-based Eli Lilly and Co. is investing $3.7 billion in a manufacturing site in Boone County and will serve as anchor tenant of the IEDC’s LEAP Lebanon Innovation and Research District, a planned 9,000-acre advanced manufacturing and tech hub. LEAP is an acronym for “Limited Exploration/Advanced Pace.”

To ensure that employers will be able to fill these jobs, business executives, education leaders and government officials are working to remove barriers to entry for workers, increase the number of Hoosiers seeking college degrees and provide students with the skills they need to secure jobs of the future.

Brad Rhorer

Conexus officials said continued state funding for manufacturing-readiness grants and more emphasis on manufacturing jobs in middle school and high school could help fill the gap.

“It’s really making sure that we’re keeping workforce development and education development in lockstep with tech adoption,” said Brad Rhorer, Conexus chief operating officer and chief talent officer. “We’re seeing a lot more exposure in our postsecondary network, but we want to see more in the [high school] space.”

Legislative help

In the most recent legislative session, the Indiana General Assembly passed several bills designed to bring more students into the STEM workforce.

State lawmakers created a program that allows eligible high school students to receive up to $5,000 for career scholarship accounts. Students can use the funds to pursue work-based learning experiences and earn postsecondary credentials before graduation.

As part of that legislation, Indiana’s authority for both secondary and postsecondary career and technical education moved from the Governor’s Workforce Cabinet to the Indiana Commission for Higher Education, a change that was intended to prepare more students for high-skill, in-demand careers in fields such as advanced manufacturing, information technology and agriculture.

“It’s a big benefit because it continues to engage students in the workplace,” Rhorer said. “I know our employers are incredibly encouraged by more opportunity for students to enter the workforce and at least experience the new technologies that are being adopted.”

State legislators also allocated an additional $40 million in the next two-year budget for manufacturing-readiness grants, which help Indiana companies invest in new technologies.

To draw more talent to Indiana, lawmakers also dramatically increased funding for the Indiana Destination Development Corp., a state agency formed in 2019 to replace the Office of Tourism Development. The agency’s mission has since expanded from primarily tourism to include attracting and retaining students and temporary workers.

Legislators also gave unprecedented levels of funding to the IEDC, including $500 million for a deal-closing fund; $500 million for READI 2.0, a third wave of regional economic development grants; and $150 million for a revolving site-acquisition fund.

Indiana’s higher education institutions are also stepping up to the challenge. Purdue University last year launched the country’s first semiconductor and microelectronics degree program, and Ivy Tech Community College offers a smart manufacturing and digital integration degree, preparing students for careers in robotics, autonomous systems and highly technical fields.

“There’s another level coming to Indiana as we look at electric vehicles, semiconductor chip manufacturers and battery manufacturers because of all of the technology involved,” said Sue Griffith Smith, Ivy Tech’s vice president for advanced manufacturing and applied sciences. “Those processes are becoming very automated. That is what we are preparing our workforce for.”•

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11 thoughts on “Where Indiana leads, too many workers don’t follow

  1. We really should create a generous scholarship programs families whose primary source of income is commodity crop farming, a factory, or a warehouse. The commodity crop market is saturated (and has been for a long time); even with LEAP and other IEDC initiatives, the total number of manufacturing jobs in Indiana will likely continue to decline overall and the high tech manufacturing that we do attract will require higher levels of education attainment; and logistics jobs physically demanding like manufacturing jobs, but without the same pay.

    Indiana is in the middle of a multi-decade workforce doom loop that cannot be solved without paying serious attention to education.

    1. We cut ourselves off at the knees 15 years ago. We cut the money going towards Indiana colleges during that recession.

      Colleges shrugged and looked at the best way to make up the difference … admit more international and out-of-state students, who pay far more. Kids who, in a lot of cases, are just here for the education and are heading back home as soon as they have that diploma.

      Meanwhile, if you’re an Indiana kid, it ‘s a lot harder to get into Indiana or Purdue than it was 25 years ago. Just today I heard about a kid who was top ten in his class at one of the big high schools in Hamilton County … who got waitlisted at Purdue. That’s insane!

      So a bunch of kids who may well want to stay in Indiana to find jobs after graduation and put down roots and raise families are instead encouraged to head elsewhere and do that in another state… that they might find more appealing for all the reasons Derek touches on.

  2. The culture warriors in the Statehouse and the well-publicized AG antics cast a dim light on Indiana as an attractive place to live.

    The state and Statehouse bad reputation of backwardness, vindictiveness, and arch-rightism masquerading behind a veil of sound governance is well known and sadly a deterrent to recruiting or maintaining.

    1. And yet the State has net in-migration, job growth, wage growth, growth in foreign direct investment, a AAA credit rating, a reserve, pays its bills, comparatively little debt, #5 in the nation for state* infrastructure, has one of the strongest real estate markets in the country for three quarters in a row (Lafayette), and has been dolling out hundreds of millions of dollars each year for the last 3 years for quality of life projects. All this despite your wishful narrative.

    2. Tell me more about this #5 in state infrastructure. US News has us at 26. Also, doesn’t flat pass the smell test. You can tell when you leave Indiana, heading into Ohio or Illinois, because the roads are just better.

      And don’t forget that a lot of that “quality of life” money was doled out from federal funding. When the time came for the state to continue on its own, it decided another tax refund was a smarter play.

    3. The predictably hilarious and out-of-touch chauvinism from college educated people leaves Derek and his clique so blinded by ideology that they fail to see what’s happening to the formerly desirable “progressive” hotbeds that were such a lure for those “most coveted” creative class types. And, of course, the reason that cities like Seattle and San Francisco and Minneapolis and Denver and of course PDX are swirling the toilet is because of the prevalence of the mentality that these same creative classers bring with them. By this point, the people least capable of nuanced or balanced reasoning are those that have spent too much time in higher ed. But they’re so hypnotized by the aroma of their own flatulence that they can’t tell.

      And this doesn’t even manage to capture Illinois, New York State, California or other places that host these hobbled alpha cities and find their state-level politics skewed because of these cities.

      2006 is calling and Derek C keeps answering. But will Derek C ever pick up the phone when 2023 calls?

      These grass-is-greener types are actually revealing how parochial they really are. Sure I don’t like cruddy roads either. I’ve also been on bad roads in Ohio and Illinois and good ones in Indiana. And if the roads are so superior in Illinois, does that mean people are using them that much more to get the heck out of Illinois? Because that’s certainly what the Census is telling us.

    4. Lauren B. – Have you recently (or ever, even) visited any of the cities you list as “swirling the toilet”? I keep seeing you accuse others of being “out of touch” or “blinded by ideology” but really consider that projection coming from you. The OP made a point about culture warriors. You then launched another one of your culture wars, which sort of reinforced his point.

    5. Yes, Greg. Do you presume I haven’t visited these places because I clearly have the political ideology of a hayseed?

      So the question is: what media sources are you using that are so desperate to shield your view of how bad things have gotten?

      I can certainly concede that the usual controlled-opposition sources (Fox, National Review, Fox, Sky News Australia, New York Post, Fox) are going to focus their efforts on the most salacious examples while ignoring the fact that 97% of people in Seattle, PDX, MPLS, SF don’t experience that stuff. But the fact remains that these atrocious conditions exist, they didn’t exist 20 years ago (probably not 10 years ago either), and if you plop the little yellow man down in Google Streetview around an interstate exit ramp in any of these cities, you can see how prevalent these encampments are. And Google most certainly does NOT like to focus our eyes onto the squalor. But their little camera cars can’t avoid it.

      So call it projection but I’m ceding ground to a centrist position that at least recognizes Fox, Fox, and Fox like to sensationalise.
      But there’s only so much they can do before it has to enter the radar of the normies who aren’t already cued to see these things. It’s abysmal.

      I mean: is the fact that DeSantis is a big-time culture warrior hurting Florida’s job prospects?

    6. Lauren: No, I don’t agree that cities of several hundred thousand people are “swirling the toilet” or “abysmal” because they have homeless. Every city in this country has problems (even those in FL) but they have positive aspects as well, and I’m not blind to either. They’re large collections of people after all. The negatives you point to do not define those cities, at least to the vast majority there, and I don’t really think it matters what your “media sources” are.

  3. “To draw more talent to Indiana, lawmakers also dramatically increased funding for the Indiana Destination Development Corp., a state agency formed in 2019 to replace the Office of Tourism Development. The agency’s mission has since expanded from primarily tourism to include attracting and retaining students and temporary workers.”

    Can IBJ show us what people in other states are seeing? Come to Indiana videos? Newspaper ads in Michigan? Billboards in Minnesota? This is a very important task and I’m thrilled that the legislature is giving it more funding. Please do an in-depth story about how this money is being used.

    1. This article provides some additional details on Indiana’s effort: https://www.ibj.com/articles/state-tourism-agency-adds-labor-needs-to-its-mission

      “In June 2022, the Indiana Destination Development Corp. came up with its IN Indiana slogan and used a $1.9 million grant from the Economic Development Administration to launch a targeted ad campaign in the Chicago, Louisville and St. Louis markets. That campaign has generated $102 million in visitor spending, resulting in $11.22 million in tax revenue, according to Longwoods International, a Toronto-based marketing firm that specializes in the travel and tourism industry. For every $1 that was invested in the campaign, $6 was generated in new taxes, according to the firm.”

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