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Presentation (PDF) Open in new window 2014 Manufacturing GDP by State (millions of current dollars) Indiana Has the Most Manufacturing Dependent Economy in Nation Indiana 2014 GDP Share by Industry Indiana Employment by Private Sector Industry March 2015 Average Indiana Weekly Wage by Sector 1st Quarter 2015 Manufacturing Wages as Share of Private Sector Wages: 2014 Annual Average Top 20 States 2015 Indiana Manufacturing Survey: Back to Uncertainty About the Study - Ninth Year, Statewide Survey - Spring – Summer 2015 - Manufacturers of all sizes - 2015 - Slumping performance in a variety of areas - Ever-growing concerns around worker shortages & regulations Indiana's Five-Year Manufacturing Health Financial Performance Will the United States Lead the World Again in Manufacturing? No - 63%, Yes - 37% When Will the United States Lead the World Again in Manufacturing? How Well Is Manufacturing Supported by Government? Importance of Regulatory Concerns to Indiana Manufacturing Which Region of the United States Leads in Manufacturing? Manufacturing Modernization Availability of Workers (2015) Availability of Workers (Next 3 to 5 Years) Skill Deficiencies Compensating for Existing Skills Gaps Summary - After a solid 4-year “run,” Indiana’s manufacturing performance has dipped - Winning strategy is investment aimed at growth - Successful manufacturers still taking advantage of advanced manufacturing methods - Shortage of skilled workers remains a dark cloud on the horizon - Regulatory issues another looming concern Workforce Challenges Indiana performs poorly as a state in key metrics of overall state skills levels - 39 percent of US businesses cited difficulties finding qualified talent in a recent Manpower survey - Indiana ranks 39th in per capita income (down from 30th in 1980) - 500,000 workers with no high school diploma (31st in nation) - 68 percent of Indiana workforce with no college degree (bottom 10 in nation) - 34 percent of high school graduates don’t attend college - Nearly 30 percent of public college students need remediation - Only 30 percent of college students complete a 4-year degree on time 2016 General Assembly: Tax - Business real property assessment – “Big Box” store issue - Goal: Limit any changes is assessment of industrial property - Engage in discussion surrounding long-term funding of infrastructure improvements - Support SEC. 199 deduction coupling - Support reductions in Business Personal Property Tax – repeal 30% depreciation floor Energy & Environment Update - Clean Power Plan - Indiana likely to seek 2-year extension of Sept. 2016 deadline to adopt state implementation plan - 2022 (start of compliance period) – 2030 (states must meet emissions goals - Ozone Standards - Lowered from 75 ppb to 70 ppb on Oct. 1 - Four counties likely to be unable to make attainment: Lake, Porter, Floyd and Clark 2016 General Assembly - “No More Stringent” effort to continue combined with added transparency and rule making oversight reforms - Storm water general permit changes – limit state adoption of federal standards - Monitor legislation offered to promote selfgeneration and rate-making reforms Unemployment Insurance Trust Fund - Early Pay-off of federal debt - Will save employers $327 million in 2016 with elimination of federal credit reduction - General fund will be paid back from UI Trust Fund by 2nd quarter 2016 (approx. $244 million) - Trust fund -> General Fund -> Federal Loan -> Benefits - Long-term solvency still a priority FUTA Penalty - The FUTA Penalty reduces the 5.4% credit against the 6.0% tax to repay the principal of the “advance.” - The credit reduction is 0.3% the first year, and compounds by 0.3% each consecutive year the “advance” remains outstanding. Pay 2016, 1.8% 2015, 1.5% 2014, 1.2% 2013, 0.9% 2012, 0.6% 2011, 0.3% 2010, 0.0% Indiana Economic Forecast Bottom Line for Indiana - Indiana’s growth continues to be higher than neighbors - Midwest growth generally lagging other parts of U.S. - Payrolls regained pre-recession peak in 2014 - Resurgent auto sector a big key to Indiana’s growth - Ind. manufacturers are big part of auto supply chain - Location makes us a logistical hub - Near-term growth should continue to be favorable - In the longer term, lack of population/labor force growth a concern