The state of Indiana demonstrates how collaborative leadership, a pro-growth environment and an engaged community can contribute to economic vitality and improved quality of life. Strategically located, fiscally sound and dedicated to growth, Indiana is a leader in the Midwest and the nation.
Indiana is ranked highly favorably in cost of living and property tax; it is ranked as Forbes’ best state for renters and is first in the Midwest and fifth in the nation for the costs of doing business, according to Chief Executive Magazine. A consistently balanced budget with twelve percent in cash reserves has helped Indiana maintain a AAA bond rating, which is a foremost source of pride.
“We call ourselves the crossroads of America, and we truly are,” explained Secretary of Commerce Jim Schellinger. Indiana is within a twelve-hour drive of sixty percent of the population in the U.S. and within an eight-hour drive of ten large municipalities.
Schellinger highlighted that Indiana has the highest number of interstate highways of any state, and is ranked number six in terms of rail infrastructure in the U.S. It is ranked number one in the country for overall infrastructure by CNBC, since Indiana has three ports that offer excellent access to maritime, rail and highway shipping channels.
Logistics is a significant component of the state economy and helps to keep industries and their goods, as well as people, moving. The movement of goods and people is efficient, and Indiana enjoys some of the shortest commute times in the country. This connectivity is the reason Indiana is home to the world’s second largest FedEx air hub.
Indiana’s diverse economy also includes a thriving automotive industry, a growing aerospace, aviation and defense sector, as well as a strong manufacturing base, agribusiness, cyber security and IT sectors. Health and life sciences also show promise for growth, and this is the orthopedics capital of the world.
“Advanced manufacturing is huge for us in Indiana. We have the number one concentration of manufacturing jobs anywhere in the country, where one out of five of our Hoosiers go to work in manufacturing organizations every day, and we have 8,500 manufacturing organizations. It’s nearly thirty percent of our [gross domestic product],” said Schellinger.
Indiana is in the unique position of being the only state in the U.S. that has three Japanese automotive assembly facilities, with Subaru, Toyota and Honda acting as huge economic players in the state. Over five hundred Tier 1, Tier 2 and Tier 3 suppliers supply these companies with what is needed to produce over one billion automobiles each year.
Indiana is home to over 260 Japanese companies that employ 53,000 Hoosiers. Schellinger appreciates the foreign direct investment in the state. “We have over eight hundred foreign-owned businesses in our state. They employ 152,000 Hoosiers. Between 2012 and 2014, they invested $4.6 billion in capital investments to create over 13,000 jobs.”
Honda made the decision to reintroduce the production of its CR-V. It moved operations from Mexico and invested $52 million in its Indiana plant, creating one hundred new jobs in just one of many examples where investments and job creation are happening in the state.
“We are very proud and supportive of our foreign direct investment. Actually, I feel strange when I say foreign direct investment because we consider these people to be family. I think the F in FDI should stand for family because they are Hoosiers through and through,” said Schellinger.
He mentioned other well-performing industries such as agribusiness, which is a $31 billion business that employs 100,000 Hoosiers. The IT sector in the state is growing at nearly three times the national rate. Between 2013 and 2015, central Indiana added tech jobs at a rate of 27.9 percent, which is more than double the U.S. average and ranks fifth in the nation. Indianapolis is ranked as one of the best places for women in the IT field.
“We’ve always been a state that grows things, makes things and moves things, but we want to build upon that,” he said. There are many factors that have contributed to Indiana’s diverse economic composition including a competitive tax and regulatory environment.
At the heart of economic development efforts in the state is the Indiana Economic Development Corporation (IEDC). The state’s leading economic development agency offers incentives and undertakes initiatives that catalyze economic growth and development.
Incentive programs include Economic Development in a Growing Economy (EDGE), which is dedicated to job creation; the Hoosier Business Investment tax credit (HBI), which supports capital investments; and the Skills Enhancement Fund (SEF), which is geared towards workforce development are performance-based funding opportunities for business expansion.
The IEDC works in close partnership with local economic development organizations (LEDO) and regional economic development organizations (REDO), as well as elected officials at all levels of government. Governor Holcomb has committed $1 billion over ten years to encourage innovation and entrepreneurship—a program IEDC is to coordinate.
“In 2015, we broke every record at IEDC. We ended up having 323 deals, 26,500 new jobs, $4.8 billion in capital investments, and average wages were about $24.87 per hour. It was a huge year for us overall,” said Schellinger. As of June 1, 128 businesses have committed to creating 12,050 new Hoosier jobs and investing $1.64 billion in their Indiana operations in the coming years. Of these planned jobs, the average wage is $28.98.
Schellinger pointed out a comparison between San Francisco and Indiana taken from a study conducted by commercial real estate firm CBRE Group to illustrate the impact of higher than average wages and the low costs associated with living and doing business in the state.
“A five-hundred-person IT company in San Francisco would cost about $55 million a year to run. The same company in Indiana would cost about $32 million to run,” he explained. “The cost of housing in San Francisco is 262 percent higher than in Indiana.”
Currently, there are 2,676,200 private sector jobs filled in Indiana. More Hoosiers are working than ever before in the state’s history. Since the recession hit in 2009, 353,000 jobs have been added, 28,700 of which were added in 2016.
When Schellinger was in Japan on a trade mission, he encountered a number of people who did not speak English but recognized Indiana. “They recognized the logo, and they know what those words are. It stands for Hoosiers who have a really good work ethic and always work together,” he said.
Regardless of political affiliation, elected leaders work together to do what is in the state’s best interest, and this approach is paying off. “Jobs are non-partisan. We’re talking about jobs for families to help people, families, communities and companies grow,” he acknowledged.
“The good news is, we’re at 3.6 percent unemployment, and the bad news is, we’re at 3.6 percent unemployment. It’s a fifteen-year low, and it’s below the national average, but the issue then becomes workforce.”
Efforts like the Regional Cities Initiative are meant to curb the impact of population and its resulting labor scarcity. “We know we can attract business, and we know business can expand here, but we want to make sure that people want to come here and live,” he said.
The Indiana Regional Cities Initiative looks to improve the quality of life and define a sense of place in Indiana. The goal is to elevate regions in the state to become nationally- and internationally-recognized as an ideal location to live, work and invest.
There are several areas that are driving growth across the state—chiefly the north-central, northeastern and southwestern regions. These regions have demonstrated a viable strategical regional development plan that will help take Indiana to new heights as an economy and as communities.
Evansville’s regional airport is being renovated, and a new medical center is being built. South Bend is benefitting from Innovation Park and Ignition Park, sister start-up accelerators at the University of Notre Dame. There is also a mixed-use technology campus located in the former Studebaker facility. The 1.2 million-square-foot site had been vacant since it closed in 1963.
Indiana is home to great little towns that are rich with history, cities bursting with opportunity, excellent services and amenities, ideal location, infrastructure, high-quality education, state parks, trail systems, and an outstanding sporting culture.
Not only can residents and visitors cheer for their favorite drivers in the Indy 500, or for teams like the Indianapolis Colts, the Indiana University Hoosiers, Indiana Pacers, they can also cheer for the results of the IEDC. “Economic development is a team sport,” Schellinger stated, and this is a sport that Indiana is dominating.
“There are just so many things that are going on around the state relative to great communities to live, work and play, but also focus on innovation and entrepreneurship because that’s what it’s going to take to be a vibrant city in the future and attract and retain talent,” he said.
“There’s nothing better than the passion and the spirit of the people; it’s contagious,” said Schellinger. He radiates a passion of his own for Indiana and its unlimited potential. “I have what I think is one of the best jobs in the world. We have such a great story to tell, because our state sells itself.”