Kokomo Tribune; Kokomo, Indiana

Opinion

June 23, 2013

MICHAEL HICKS: Good news at plants in 2013

Indiana sees productivity growth from manufacturing sector.

I am always reluctant to fill this column with my recent research, but this week’s release of the annual Conexus Indiana Manufactur-ing and Logistics Report (available at www.conexus.cberdata.org) begs comment. The scorecard itself had just a few surprises. Indiana did much better in the cost of worker benefits, and continued to lead in the size of manufacturing and logistics. We also report that Indiana ranked third overall in the pace of manufacturing recovery since the end of the Great Recession, trailing only the tiny manufacturing states of Alaska and North Dakota, whose energy production has propelled their growth.

Our human capital scores took a surprising downturn, but the problem is a good one to have. The classes who entered community colleges in 2007 saw graduation rates dropping by 3.8 percent. This would typically be a worry, since improving graduation rates is the key to our long-term prosperity, but there’s a clear and happy reason for this anomaly. Enrollment growth in these schools jumped from 25th to first place during the recession years (and has subsequently returned to trend). Unsurprisingly, some of these students have yet to graduate; in fact, with enrollment growing more than 15 percent a year during the recession, we should have seen a far deeper drop in graduation rates. Over the next two or three years, the spike in associate degree students we experienced during the Great Recession will boost our human capital, and hence our grades. In the short term, it placed huge stress on our public and private community colleges.

The most interesting part of our manufacturing research this year was revelations on productivity growth in Indiana. The downturn took a heavy toll on our manufacturing of big ticket items (cars and trucks), which are high value-added goods. This left us with a greater share of low value-added production of commodity-type products, and so reduced our ranking slightly. However, there’s an even richer story about manufacturing productivity over the past decade that we reported this week. Manufacturing productivity consists of four things: technology growth, plant and equipment, workers and something economists call “total factor productivity.” This TFP is growth that cannot be explained by other factors. It is really the sole source of economic growth in a developed economy.

Text Only | Photo Reprints
Opinion
  • LoBianco: Bigger ethics questions raised in House Turner review

    Members of the House Ethics Committee who will take up Rep. Eric Turner’s case face daunting tasks as they try to answer two questions: Did their powerful colleague violate any ethics rules in privately lobbying against a measure that would have hurt his family’s business?

    April 18, 2014

  • Letters to the Editor: April 18, 2014

    Attendees at the Tipton County Board of Commissioners meeting April 7 were treated to an appalling lack of both action and concern by the commissioners.

    April 18, 2014

  • Letter to the Editor: April 17, 2014

    On March 20 of this year I attended a public meeting of the Tipton County Economic Development Alliance. Members of this group include the three county commissioners, a member of the county council, two members from the city council, and the mayor.

    April 17, 2014

  • Hicks: Measuring the unmeasurable

    One aspect of economic research I think is especially powerful is the ability to measure or monetize the things that humans clearly value but for which a market price is not necessarily apparent. This is one of the aspects of economic analysis that gives it such dominance over other social sciences.

    April 17, 2014

  • Rob Burgess House of Burgess: Bush presents 'The Art of Leadership'

    On April 5, “The Art of Leadership: A President’s Personal Diplomacy,” opened at the George W. Bush Presidential Library and Museum on the campus of Southern Methodist University. The display, which runs through June 3, boasts “portraits of more than two dozen world leaders” painted by Bush, according to the official literature.

    April 16, 2014 1 Photo

  • Bohanon: ‘Economics is fun’ in Vegas or in Bible study

    I am writing this on an airplane to Las Vegas. I’ll be attending the annual conference of the Association of Private Enterprise Education along with two of my colleagues and six of my students.

    April 16, 2014

  • Letters to the Editor: April 16, 2014

    At the time the agenda for the April 7 commissioner meeting came out, I was happy to see that the neglected commissioner board appointments were finally going to be addressed. These appointments had been in limbo for months on end.

    April 16, 2014

  • Hayden: Want better teacher ratings? Ask the kids

    The state may be back where it started, encumbered with a flawed teacher grading system, a year after implementing what were meant to be tough new standards.
    That was the general consensus of the State Board of Education days after teacher evaluation data were released last week.

    April 15, 2014

  • Letters to the Editor: April 15, 2014

    In a recent “public eye” article written by KT columnist Scott Smith about the proposed industrial wind turbine project; mention was made of the “new deal” brokered by Howard County Commissioners with E.ON.

    April 15, 2014

  • BRIAN HOWEY: Mike Pence for president in 2016? Stay tuned Mike Pence for president? The swirl of 2016 national ticket talk surrounding Gov. Pence intensified over the past few weeks. I sat down with the governor in his office on Tuesday to find out what he's really thinking. A few hours prior, the Weekly S

    April 14, 2014

Featured Ads
Only on our website
AP Video
Obama Hopeful on Ukraine, Will Watch Russians Flamingo Frenzy Ahead of Zoo Construction Crew Criticized Over Handling of Ferry Disaster Agreement Reached to Calm Ukraine Tensions Raw: Pope Francis Performs Pre-easter Ritual Raw: Bulgarian Monastery Dyes 5000 Easter Eggs Diplomats Reach Deal to Ease Tensions in Ukraine U.S. Sending Nonlethal Aid to Ukraine Military Holder: Americans Stand With KC Mourners Obama Greets Wounded Warriors Malaysia Plane: Ocean Floor Images 'Very Clear' Sparks Fly With Derulo and Jordin on New Album Franco Leads Star-studded Broadway Cast Raw: Two Lucky Kids Get Ride in Popemobile Boston Bombing Survivors One Year Later Sister of Slain MIT Officer Reflects on Bombing
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Obituaries
Poll