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Indiana's Steel
Industry Continues to Boom

Indiana has not initiated significant new economic-development initiatives in the last year, but it has devoted considerable attention in recent years to making its recruitment efforts competitive. This helped the state land 210 companies' new plants or expansions in 1999, which will result in 18,000 additional jobs and $2.5 billion worth of investments in the state.

"As you look at Indiana over the last 10 years, it has outperformed the national average," says Morton Marcus, director of the Indiana Business Research Center at Indiana University. "Prior to 1988, the state performed poorly. The state's doing well now, and there's no reason to tinker with that."

Indiana, of course, has its own little secrets. The Hoosier State is the No. 1 steel-producing state in the United States. That makes it a key player in terms of durable goods, which are susceptible to economic downturns but make it a player in good times like now.

"The mills in Indiana produce a high-quality steel for things like automobiles and refrigerators," Marcus says. "Indiana has been the top steel producing state for 20 years. Manufacturing has been growing in Indiana."

With its location in the heart of auto country, Indiana steel manufacturers are easily able to serve the corridor of auto plants that have sprung up in the Interstate-65 and I-75 corridors that reach from Michigan south to Alabama and Georgia. Many of those markets focus on auto parts.

Indiana has also taken dead aim at growing its export markets, much of which rests on its manufacturing base. In 1999, for instance, Indiana exported $14 billion in goods, a record year, according to Larry Davidson, an economist at Indiana University. That's an increase from $4.8 billion in 1988.

"Export growth has been very strong," Davidson says. "Our manufacturing sector has done very well, even through the Asian crisis, partly because we weren't so dependent on the Asian economy. I think you'd find Indiana is bucking the trend nationally in manufacturing employment."

Manufacturing processes are increasingly high-tech, and some of that trend will be seen in the imposing $800 million investment that Toyota announced the end of last year for Princeton. Toyota's expansion in Indiana, the third in four years, will increase the company's production facility in Princeton and create an additional 2,000 jobs. The company already employs 4,300 in Gibson County. When the latest expansion is completed, Toyota will have invested $2 billion in the community.

Meanwhile, Indiana is working to improve its workforce and prepare it for high-tech jobs. The state is embarking on building a community college system with educational opportunities that previously were left to regional campuses of the state's public universities. In June, Lt. Gov. Joe Kernan presented the first grants from the state's 21st Century Research and Technology Fund to help spur high-tech jobs.