Indiana Chamber: Despite Economic Progress, Workforce Growth Lags

Jun 7, 2017

The Indiana Chamber of Commerce’s latest report card on the state economy’s race to the top shows some progress. But a lot of obstacles remain.

The Vision 2025 Plan is basically the Chamber’s policy platform. Chamber president Kevin Brinegar says it lays out the ways Indiana’s economy should succeed.

“We believe, if we can be best of class in each of these areas, that Indiana will have the best chance for competitiveness and prosperity in the 21st-century global economy,” he says.

The Chamber issues status reports on the plan every two years. The latest, out this week, says Indiana improved in two metrics for every one where it declined. Brinegar says that’s better than their last report card, in 2015.

“There’s a lot of reasons for celebration, but the report card also shows some areas where we’re still lagging,” he says. “It gives us an idea, and gives policy-makers an idea, of where we need to redouble our efforts.”

Workforce development is one such area of concern, Brinegar says. Indiana now ranks third in the nation for science and technology, but it’s near the bottom for putting degree-holders to work in Indiana.

“We’re producing the individuals, but arguably, too many of them are leaving our state,” Brinegar says.

He says the state has to do more to connect those workers with training and open jobs. The current gap, he says, is prompting firms to ease up on drug testing for new hires, or focus on recruiting veterans or even ex-convicts.

“When you’re down at 3.6 percent statewide unemployment, you know, you start to lower your standards, you start to look at different things,” he says.

Though new reforms around career education may not have an instant effect on Indiana’s workforce, Brinegar hopes they’ll move the needle by 2025.

The state also made progress on K-12 educational proficiencies this year, but fell behind on closing its achievement gap for disadvantaged students.

Meanwhile, Indiana’s tax and legal climates rank high, but its energy and health care costs aren’t improving quickly. Neither are its obesity and smoking rates.

Brinegar says those makes Indiana less productive, and more expensive for new businesses.

“And while that isn’t always necessarily the number-one factor… it’s a strike against us, and detracts from our otherwise very positive business climate rankings,” he says.

In light of that, he says, the Chamber is especially worried about entrepreneurial growth. Indiana already ranks low on start-up job creation and venture capital activity, and it lost even more ground in the past two years.

That’s bad news, says Brinegar, “because older, more mature businesses tend to add jobs at a much slower rate, and often are contracting their employment levels.”

He says the Chamber will use the new report card to push for more workforce and other reforms during the next legislative session.