The 2013 Indiana Manufacturing Industry Survey released Wednesday shows potential storm clouds on the horizon for the state’s sector, despite many researchers predicting a manufacturing renaissance.
Indiana University professor Steven Jones says growth in Indiana’s manufacturing industry is led by a surge in smart manufacturing, which combines things such as new technologies with reductions in energy needs. He says it gives local manufacturers an advantage over companies overseas.
“The reduction in the need for labor ironically ends up meaning that our high labor costs don’t work to our disadvantage so much as they did before which means that there’s a lot of opportunity for new employment in smart manufacturing if the skilled workers are there,” he says.
Jones says companies believe there is a significant shortage of skilled workers and predict an even greater shortage in the next few years.
The data also reveals that Indiana manufacturers believe state and local government policy does not provide them an advantage.
IU professor Mark Frohlich says he is surprised by that, especially since previous surveys showed the opposite.
“Some of those initiatives were taken over the last two or three years, if you think about the changes in inventory taxes and property taxes and perhaps now manufacturers are thinking, ‘That was great but what can you do for us now?’” he says.
Frohlich says frustration with government at the national level may be reflected in the perceived dissatisfaction with state and local government.