Indiana’s entrepreneurial community seems to be thriving. The Kauffman Foundation recognizes the Hoosier State as one of America’s best places to launch a business. Plus, Indianapolis has made the Top 10 of IT per-capita job growth rankings for most of this century, as calculated by New Geography.
Its economic-development chief talks of a record-setting economy two years running. In early summer, just days before being named Donald Trump’s vice-presidential candidate, Gov. Mike Pence announced a $1 billion plan to accelerate entrepreneurship over the next decade by addressing the innovation economy’s long-term growth needs: namely young workers and enterprise funding.
Unveiling the plan to a business group, Gov. Pence said: “We must build on this economic momentum and increase collaboration between educators, community leaders, industry partners and, most importantly, idea generators (so as) to further propel innovation.”
The governor’s plan promises to double funding available to small businesses and growth companies over a 10-year span and to boost services. Goals include: idea-economy programs created at the high school level; advance research initiatives and best-practices sharing at the university level; money to build co-working spaces, incubators and innovation centers; scaling-up assistance for companies; support for industry-driven strategic initiatives; cluster-based company support and increased micro-lending to small businesses.
To line up funding, the governor plans to tap the state legislature, venture capital funds and Indy investment group Elevate Ventures. His big “ask” was for $500 million—representing half the plan’s total budget—from the Indiana Public Retirement System. The pension fund, whose mandate includes supporting Indiana businesses as well as optimizing investment returns, has not yet formally responded. In contrast to the usual state emphasis on corporate recruitment, the programs sketched out in the new plan are best described as talent nurturing, said Jim Schellinger, the IEDC chief who’s coordinating statewide efforts. “We’ve proven Indiana can be a destination for business. Now we have to make Indiana a destination for talent.”
MOST MANUFACTURING-INTENSE STATE
Indiana Gov. Mike Pence and president-elect Donald Trump touted the governor’s track record lowering taxes and creating jobs in Indiana during the presidential campaign. The new tax structure “puts Indiana at a much more competitive advantage,” says Indianapolis site selector Larry Gigerich. “It’s a very easy state for doing business, not a lot of bureaucracy to deter.”
As for job growth, the Hoosier State ranked 19th in the nation during Gov. Pence’s administration. Indiana job growth is “heavily dependent on the strength of the national economy,” observed the hometown Indy Star. “As the most manufacturing-intensive state in the nation, we make lots of things. When consumers and companies are buying those things, the factories run fast and hard and… need workers.” Workforce quality, said Gigerich, “is the biggest challenge Indiana faces.” State programs such as the Skills Enhancement Fund help bridge the skills gap, he said.
Business leaders describe a pro-startup culture and a business climate that favors quality of life and sense of place. After Salesforce’s 2013 acquisition of homegrown ExactTarget, many departing execs invested their payouts to launch small businesses near home. The growth of these startups “has been a huge part of Indiana’s renaissance,” said Tim Cook, CEO of KSM Location Advisors in Indianapolis. “Also, the low tax climate, balanced budget, strong incentives and solid business climate” add appeal.
On the campaign trail this spring, Gov. John Kasich touted Ohio’s manufacturing sector growth and overall job-creation success to mostly positive local reviews. Roger Geiger, head of the NFIB’s Ohio chapter, praised the governor’s tax reform policies, which lowered the top tax bracket below 5 percent and made Ohio more competitive with neighbors like Michigan and Kentucky. Tax reform has also encouraged entrepreneurs to start new businesses, Geiger said.
“Ohio is most definitely business-friendly,” said site selector Gigerich. Cities like Cleveland and Toledo are shedding Rust Belt images and attracting tech and financial firms. Columbus and Cincinnati are more aggressively using incentives to recruit CEOs. Quality of life is a major draw.