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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowIndiana’s status as the most manufacturing-intensive state in the country is something to be proud of—although that hasn’t always been the prevailing attitude.
For a time, when much of the nation’s manufacturing was moving overseas or to Mexico where goods could be produced more cheaply, Indiana’s economy seemed—and likely was—especially vulnerable.
But as geopolitics have changed, the country has reprioritized having key electronics—including computer chips, batteries and other important components—made in America. The pandemic, which wreaked havoc on the world’s supply chain, also persuaded many U.S. companies that they should buy from suppliers closer to home.
Today, the federal government is spending billions of dollars to incentivize the manufacturing of microelectronics domestically. And Indiana—which has a long history of making cars, batteries, appliances, RVs and so much more—has been well positioned to benefit from these changes.
Economic development announcements involving Toyota, SK Hynix, Stellantis, Eli Lilly and Co., Toyota Material Handling Manufacturing and others have been rolling in, bringing with them well-paying jobs.
But Indiana’s strategic advantage as a manufacturing powerhouse is dependent not just on companies that are building new plants with the latest technology but also in ensuring that existing manufacturers—many of which are suppliers for the big guys—implement the latest technology. If they don’t, they could lose the ability to compete.
As IBJ reporter Susan Orr explains in her page 3A story about what’s called Industry 4.0, the state’s manufacturers have been behind in implementing the kinds of connected technologies that help companies automate and track their operations. As of 2020, only 15% of respondents to a Conexus survey said they had implemented at least one Industry 4.0 technology, while 6% said they were conducting their first pilot project. And 31% said that they had no foreseeable plans to adopt such technologies.
So the Indiana Economic Development Corp. and Conexus launched the Manufacturing Readiness Grants program in 2020 to encourage manufacturers to modernize their operations with advanced technologies. To date, 526 grants worth a total of $56.9 million have been distributed to help companies boost their technology.
The program is on pause until July 1, when the new fiscal year begins and $20 million becomes available. The state reports more than 300 parties have already expressed interest in applying for the next round of funding.
That demand is encouraging. And we are also encouraged that industry networks—such as the Wabash Heartland Innovation Network (see Mickey Shuey’s story on page 14A)—are helping companies determine the best technology to fill their needs.
It might seem that this technology—which includes robots and other automation—could take jobs away from Hoosiers. But already, companies are concerned about finding enough workers, and the new technology requires highly skilled workers to program and maintain it.
So we urge the state and industry groups to continue to make money and programs available to help maintain Indiana’s place as a manufacturing powerhouse.•
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I’m not against technological improvements, but it would be a disservice to Hoosiers to invest a penny of state money in higher technologies before making investments in education.
It’s pretty well established that more advanced technology & automation have lead to more manufacturing job losses in the US – in Indiana and elsewhere – than globalization ever did. The loss of low-tech manufacturing has been devastating for much of Indiana. There are still thousands of such jobs in Indiana, slowly being eaten into by technology and leaving devastation behind.
High-tech manufacturing is totally different from manufacturing of the past, often requiring much more educated workers. It’s a massive mistake to subsidize high-tech manufacturing before giving extraordinary educational opportunities to those who would otherwise be left behind.