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Indiana manufacturers say they are optimistic about future, survey reveals
Indiana manufacturers say they are optimistic about future, survey reveals

November 11, 2014 »  Indiana manufacturers are upbeat about their prospects for future growth, according to a survey released today, yet their enthusiasm is tempered somewhat by concerns over increased regulation, rising energy costs and a shortage of skilled workers. The manufacturing survey put together by the Indianapolis accounting firm of Katz, Sapper & Miller and Indiana University's Kelley School of Business is based on responses from companies across the state. Nearly 50 percent of the businesses that responded are in the industrial equipment, automotive, or aerospace and defense manufacturing sectors, and 88 percent of them are headquartered in the United States. According to the survey, 72 percent of respondents said they anticipated moderate economic growth in Indiana through 2015, while 52 percent of respondents predicted similar moderate growth for the U.S. economy. Forty-seven percent of respondents said they saw "healthy" financial performance in 2012-2013, while 35 percent characterized it as "stable" and 17 percent described it as "challenged." Less than 35 percent of companies identified their financial performance as "healthy" in last year's survey. And just three years ago, 47 percent of respondents said their financial performance was "challenged." The percentage of respondents who said they plan on opening a new manufacturing facility Indiana increased from 8 percent last year to 20 percent this year, and of those planning to expand, more than half said the new facilities will be used to produce new and existing products. And yet, the percentage of companies that plan on "offshoring" production over the next year rose to 10 percent from 7 percent of respondents the previous year. They cited skilled overseas labor and lower labor costs as the main reasons for doing so. Perhaps the biggest challenge manufacturing companies face is finding skilled workers. Thirty-one percent of companies indicated a serious shortage of skilled production workers, and 38 percent said they feared a serious shortage of skilled production workers in the next three to five years. In addition, manufacturing companies are rejecting job candidates because they don't possess rudimentary job skills; 70 percent of respondents said rejected candidates lacked basic skills such as regular attendance, timeliness and work ethic. Roughly two-thirds of respondents identified four chief issues that could affect future growth: Indiana's business health care laws and regulations (67 percent); Indiana's infrastructure and logistics, and the state's corporate tax policy (both 66 percent); and Indiana's property tax policy (65 percent). More specifically, 73 percent of respondents said they were concerned about changes to the federal Patient Protection and Affordable Care Act, while 53 percent said they worried about new regulations to control greenhouse gas emissions. Another 46 percent said the cost of electricity "highly" affected their businesses, and 45 percent said it "somewhat" affected their businesses. Barry Rochford, Star ©Copyright 2014 KPC Media Group, Inc.

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Polarized Labor Markets and the Supply and Demand of Unskilled Workers
Polarized Labor Markets and the Supply and Demand of Unskilled Workers

November 6, 2014 » High-skilled and low-skilled workers face very different futures in this economy. In recent years, average wages in the U.S. have stagnated. This means that wages for some workers have declined while wages for others have risen. Understanding why this has happened is important for any policy discussion. In economic theory, wages are largely determined by the productivity of workers. As worker productivity rises, so too will wages. However, productivity in this context is how much benefit the workers themselves add to overall production, not just the total value of goods produced by each worker. Let me offer an example. Imagine a highly skilled worker, such as a cabinetmaker, computer programmer or surgeon. Each will have perhaps many tens of thousands of dollars’ worth of tools, and each will produce goods or services worth from several hundred to several thousand dollars per day. People in these occupations spend years in education and training, and the equipment they use is impractical in the hands of an unskilled worker. So, each of these folks receive earnings that are principally determined by the individual value each brings to their job. In contrast, imagine a worker in a highly robotic assembly plant, surrounded by tens of millions of dollars of machinery. This worker might also be skilled, but in this case most of the value of the goods produced comes from the contribution of the machines, not the worker. In both examples workers might be highly skilled and well paid, but there the difference ends. The highest share of income goes to the worker whose skills matter most to the production process. But this is only part of the story. In the first example, there’s very little that can be done to make the machines matter more than the worker. If we want more cabinets, computer programs and medical care, we’ll need more of these skilled folks. In the second example, there’s little incentive to replace the workers because they represent such a small share of the cost of production. In each of these cases, workers will be in demand and the economy can grow continuously as long as they are available. But what happens to unskilled workers? Unless they are training for a new position, workers with poor skills won’t be in demand in either setting. Even in these cases, workers without the prospects of acquiring these skills and the dependable work habits that these jobs require just aren’t needed. The result is that the American labor force is slowly becoming polarized. At one end are highly skilled, dependable, well compensated workers. At the other end is workers who are either not highly skilled or not dependable, so will have lower wages. Alas, there’s not much more to the story. It isn’t the decline of unions or the rise of Wall Street fat cats that have caused this. It is the inevitable decline in demand for low-skilled workers at a time when we are supplied with an abundance of them. Until that changes, expect more of the same. Link to this commentary: http://commentaries.cberdata.org/756/polarized-labor-markets-and-the-supply-and-demand-of-unskilled-workers October 19, 2014 Author: Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Hicks earned doctoral and master’s degrees in economics from the University of Tennessee and a bachelor’s degree in economics from Virginia Military Institute. He has authored two books and more than 60 scholarly works focusing on state and local public policy, including tax and expenditure policy and the impact of Wal-Mart on local economies.

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Manufacturer brings jobs to Gary
Manufacturer brings jobs to Gary

July 8, 2014 |Gary, Ind. -- Superior Truss & Panel, Inc., a manufacturer and installer of commercial building roof trusses and wall panels, announced plans today to relocate its Markham, Ill. operations to Gary, creating up to 52 new jobs by 2016. The company will invest $2.6 million to construct, equip and relocate its operations into two 24,000 square-foot buildings on 8.5 acres at 7592 East Melton Road in Gary. The facility, which will begin Indiana operations this fall, will allow the company to innovate new methods for panelizing light gauge steel trusses and wall panels for non-combustible classified structures. "The Hoosier State remains an attractive place to run a business because it provides the ideal climate for growth," said Victor Smith, Indiana Secretary of Commerce. "Indiana has worked hard to build a business environment that lets companies succeed on their own terms, free from restrictive regulations or red tape. With our low taxes, skilled workforce and robust transportation networks, Indiana stands out as a state that works." Superior Truss & Panel, which currently employs 48 full-time associates, plans to begin hiring manufacturing associates this month. Interested applicants may apply at the company’s new Gary location or by emailing a resume to information@superior-truss.com. "While Indiana has a business friendly environment, Gary provides easy access to interstate highways, allowing greater convenience in shipping to multiple states," said Bryce Welty, president of Superior Truss & Panel. Founded in 1993, Superior Truss & Panel designs, engineers, fabricates and installs metal roof trusses and load bearing wall panels for the commercial construction industry. The company has manufactured projects for more than 1,500 building projects located east of the Rocky Mountains, specializing in construction for nursing homes, hotels, schools, office buildings, churches, apartments and government buildings. Superior Truss and Panel has repeatedly been the recipient of Aegis Metal Framing’s President’s Council Award, presented to the top 10 fabricators using the company’s MiTek System. The Indiana Economic Development Corporation offered Superior Truss & Panel, Inc. up to $425,000 in conditional tax credits based on the company's job creation plans. These tax credits are performance-based, meaning until Hoosiers are hired, the company is not eligible to claim incentives. The city of Gary approved additional incentives at the request of the Gary Economic Development Corporation. "As I've said on countless occasions, 'The city of Gary is open for business,’" said Gary Mayor Karen Freeman-Wilson. "Superior Truss & Panel's commitment to relocate to Gary further proves this fact. We thank them for their investment and the job opportunities this will create for Gary residents to support their families and improve their quality of life." Illinois companies continue to make the move to Indiana, where they find a low-tax, pro-growth business environment. Superior Truss & Panel’s announcement follows news just last week that Lemont, Illinois-based llini Hi-Reach, a rental provider of aerial work platforms and material handling equipment, would invest $13.6 million to relocate its corporate headquarters and service hub to Crown Point. About Superior Truss & Panel Superior Truss is America's largest fabricator and erector of light gauge steel trusses and loadbearing wall panels. Our primary philosophy is to provide the highest level of design, engineering and installation at the best value in the industry. For more information, visit www.superior-truss.com. About IEDC Created in 2005 to replace the former Department of Commerce, the Indiana Economic Development Corporation is governed by a 12-member board chaired by Governor Mike Pence. Victor Smith serves as the Indiana Secretary of Commerce and Eric Doden is the president of the IEDC. The IEDC oversees programs enacted by the General Assembly including tax credits, workforce training grants and public infrastructure assistance. All tax credits are performance-based. Therefore, companies must first invest in Indiana through job creation or capital investment before incentives are paid. A company who does not meet its full projections only receives a percentage of the incentives proportional to its actual investment. For more information about IEDC, visit www.iedc.in.gov. Source: Indiana Economic Development Corp.  

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