2018 Indiana Manufacturing Survey: Push for automation increases

INDIANAPOLIS --As Indiana's largest industry sector enjoys continued growth in revenues and profits, its employers are investing heavily in automation and manufacturing efficiency, welcoming an industry movement that, nationally, has been dubbed "Industry 4.0."

The "2018 Indiana Manufacturing Survey: Industry 4.0 Has Arrived" report shows that most Indiana manufacturers consider investments in facilities, machinery and related information technology to be their top concern. Meanwhile, the percentage of firms identifying workforce development as their top concern declined to its lowest level in a decade.

"If last year's shift in favor of automation and facilities was a growing wave, this year's results seem more like a tsunami," said survey co-author Steve Jones, a professor of finance at the Indiana University Kelley School of Business on the IUPUI campus. "Hoosier manufacturers recognize that they must join the Industry 4.0 revolution if they want to remain competitive."

The annual manufacturing survey -- commissioned by Katz, Sapper & Miller; authored by faculty from IU's Kelley School of Business on the IUPUI campus; and promoted by the Indiana Manufacturers Association -- is designed to assess the state of Indiana's manufacturing industry and provide insights into management choices made by manufacturing companies across the state.

Respondents to this year's survey reflect views from rural to urban Indiana communities and industries ranging from industrial equipment, automotive, aerospace/defense, packaging, high-tech and health care.

"Manufacturers continue to see automation not only as a way to increase efficiency and productivity, but also as a way to address workforce shortages," said Jason Patch, partner-in-charge of Katz, Sapper & Miller's Manufacturing and Distribution Services Group. "Still, they recognize that, even as increased technology reduces their reliance on unskilled workers, they will need more skilled workers to operate the factories of the future."

The report authors suggested that, in order to meet this growing need, manufacturers must train and "upskill" current workers and aggressively recruit high school students into the field. At the same time, they must make the case to all Hoosiers about how important manufacturing is to the state's economy.

"This survey shows that manufacturing is strong in Indiana, but the state can't take its position for granted," said survey co-author Mark Frohlich, an associate professor of operations management at the IU Kelley School of Business on the IUPUI campus. "Issues such as regulations and tariffs, health care reform, and the workforce shortage must be addressed if Indiana manufacturers are to maintain their competitive strength."

The "2018 Indiana Manufacturing Survey: Industry 4.0 Has Arrived" report includes valuable data for the manufacturing community as well as service providers and economic development officials. A full copy of the report with complete findings can be found online.

About Katz, Sapper & Miller

As one of the top 60 CPA firms in the nation,Katz, Sapper & Miller has earned a reputation as a leader in the areas of accounting, tax and consulting services. The firm has more than 400 employees and is headquartered in Indianapolis, with additional offices in Fort Wayne and New York City. KSM is consistently named one of the "Best of the Best" accounting firms in the nation by INSIDE Public Accounting magazine. The firm is a member of PrimeGlobal, a global association of independent accounting firms.

About the Kelley School of Business on the IUPUI Campus

The Indiana University Kelley School of Business has been a leader in American business education since 1920. With more than 110,000 living alumni and an enrollment exceeding 11,000 students across two campuses and online, the Kelley School is among the premier business schools in the country. The Kelley School at IUPUI is home to a full-time undergraduate program and four graduate programs, including master's programs in accounting and taxation; the Business of Medicine Physician MBA; and the Evening MBA, which is ranked 13th in the country by U.S. News & World Report.

About the Indiana Manufacturers Association

Formed in 1901, the Indiana Manufacturers Association is the second-oldest manufacturers association in the country and the only trade association in Indiana that exclusively focuses on manufacturing. Manufacturing is the driving force of Indiana's economy, employing more people and contributing more to Indiana's gross domestic product than any other industry. The Indiana Manufacturers Association, representing more than 1,100 companies, is dedicated to advocating for a business climate that creates, protects and promotes quality manufacturing jobs in Indiana. The staff of the Indiana Manufacturers Association are recognized experts in areas including tax, environment, labor relations, human resources, energy, workforce development and health care.

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