Aug 1, 2023 - Business

Indiana lags in nationwide manufacturing boom

Data: BLS; Note: May 2023 data is preliminary. Seasonally-adjusted estimates used; Map: Axios Visuals

Indiana is missing out on a manufacturing boom, despite being one of the top states in the U.S. for making goods.

Why it matters: Indiana's slow growth in a sector it has traditionally dominated points to a mismatch between the state's workers and the skills employers are looking for.

By the numbers: Indiana gained about 18,000 manufacturing jobs from January 2021 to May, an increase of about 3.5%, according to the Bureau of Labor Statistics.

  • That's the seventh-lowest statewide percentage gain during that time.

The big picture: The U.S. economy has added some 800,000 manufacturing jobs during President Biden's 2½ years in office, with the South and Mountain West — including several red states — having especially strong growth, Axios' Hans Nichols writes.

  • Biden is seeking to take credit for those new jobs, especially the union ones.

Between the lines: Indiana is ill-equipped to keep up because the state's manufacturing workforce is less educated than the national average, Ball State University economist Michael Hicks told Axios.

  • Also, low-skilled jobs — especially common in Indiana — are among the easiest to automate, Hicks said.

What they're saying: "In the short run, a less well-educated factory workforce makes employment more volatile," Hicks said. "Lower skilled workers are more abundant, and firms (are) less worried about replacing them as the economy slows."

The other side: Indiana has made high-profile manufacturing announcements in recent months, including the long-awaited news that General Motors and Samsung SDI are partnering on a $3 billion battery manufacturing plant near New Carlisle.

  • Gov. Eric Holcomb called it "proof that Indiana has turned it up and shifted into a higher gear."

Yes, but: Hicks noted Indiana lost manufacturing jobs through the first six months of the year, while the sector grew by 1.3% nationwide.

  • "All the happy economic development news and promiscuous use of tax incentives masks the fact that Hoosier manufacturing employment is shrinking," Hicks said.

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