Forbes recently released its annual ranking of the best states for business. Indiana cracked the top 10 coming in at 10th for 2017. Forbes analyzed approximately 40 metrics spanning six category groupings: business costs, labor supply, regulatory environment; economic climate, growth prospects, and quality of life.
This story by Larry Gigerich originally appeared in Inside Indiana Business.
How Indiana ranked amongst the 50 states in the six categories utilized in this year’s study.
1. Business Costs: 12th
2. Labor Supply: 45th
3. Regulatory Environment: 1st
4. Economic Climate: 23rd
5. Growth Prospects: 18th
6. Quality of Life Rank: 4th
Generally speaking, the grades given to Indiana are not surprising. The state has continued to implement steps to enhance its business and regulatory environment. By cutting taxes, streamlining the regulatory process and investing heavily in infrastructure, Indiana has demonstrated that it is “open for business” and wants to support growing companies.
In addition, Indiana’s significant investments in quality of place initiatives and low cost of living have improved the state’s quality of life and growth prospects. The state should continue its investments in quality of place assets by taking the best components of the Regional Cities Initiatives and incorporating more rural communities into the process, to maximize the opportunities for all Hoosiers.
The area where the state continues to receive low marks relates to its workforce. Indiana does not fare well on a national basis in the areas of educational attainment, certifications/credentials held by adults in the workforce and adults in the workforce pursuing continuing education.
Gov. Holcomb and legislative leaders have identified the issue of talent development as the number one priority for Indiana. Holcomb’s creation of a Cabinet-level position, Secretary of Career Connections and Talent, and the selection of Blair Milo to serve in that role, is a promising development for the state.
Indiana has been recognized as a leader in K – 12 education reform during the past 10 years. The state’s focus in this area was greatly needed in order to begin to fix an underperforming education system impacting urban, rural and suburban communities. While we have great momentum in this area, there is still work ahead.
The area that we need to become more aggressive in relates to adults already in the workforce that do not have the requisite skills to compete as effectively in the ever changing global economy. At a time when unemployment rates are low and wages are increasing, Indiana must “triple down” on the issue of talent development and implement (including funding) transformative programs as other states (Arizona, South Carolina, Tennessee, etc.) in the United States have done in recent years.
The state’s challenge of adapting to the continually changing global economy has impacted the make-up of the business community in Indiana. Part of this issue ties to our larger share of manufacturing as compared to most of the United States. Also, the changing behavior of consumers in terms of spending has had an impact on the overall economy in the state. These things are not going away, so we need to continue transform ourselves.
In summary, Indiana’s ranking relative to the country is very good. Policy makers in the state should focus on ways to improve our weaknesses and capitalize on our strengths in order to maximize economic opportunity for everyone in Indiana. Due to the fact that Indiana is not generally a location for large headquarters companies, we need to continue to focus on growing entrepreneurs and small and mid-sized businesses that will continue to be the lifeblood of the state’s economic growth.