ELKHART — This year’s manufacturing and logistics report card shows Indiana remains very strong in most measures of manufacturing and logistics.
Indiana received an “A” grade in tax climate, global reach, logistics industry health and manufacturing industry health, the only state in the region to do so in the study by Michael Hicks, PhD, of Ball State University, and the university’s center for business and economic research. The study was sponsored by Conexus Indiana, the nonprofit statewide manufacturing and logistics initiative.
It’s good news for Elkhart County, which is one of the heaviest manufacturing counties in the nation according to the U.S. Census Bureau and which has more than half the jobs here in the manufacturing and logistics sectors.
In a twist, though, the booming recreational vehicle industry played into one downgrade the state saw over last year: Sector diversification dropped from a C+ in 2012 to a C this year. Statewide, the drop was attributed to the rapid growth in transportation equipment, which rebounded more steeply than other sectors.
The state’s worst grade, a D in the human capital category, is recession-related and actually masks some good news, according to Hicks.
“While there is a decline in the human capital grade, there is a bit of an anomaly as the decline of associate degrees is tied to the fact that there is huge growth in enrollments,” Hicks said in a written announcement about the report card. “It is not surprising that there would be a decline in graduation rates as the recession improved. This may be a positive in the future as Indiana leads the nation in enrollment in these important programs.”
Conexus Indiana president and CEO Steve Dwyer said, “One of the first categories I look at each year is human capital and while I am pleased to see a huge influx of students into associate degree programs, we have to make sure that students graduate,” he said. “I believe that middle-skill programs will dictate the long-term health of manufacturing.”
Ivy Tech Community College president Thomas J. Snyder believes more can be done. “Indiana has been short-changing career and vocational education for some time. The governor has a platform to rethink this direction. We think we can help,” he said.
The state’s manufacturing and logistics sector saw a mild improvement in worker benefit costs and drops in productivity and innovation and in the expected liability gap category, all of which scored in the C range. The productivity and innovation drop was attributed to the lasting effects of the recession on the data used to measure the category, and the report’s authors expect the measure to rebound significantly.