What economic development comes down to, more than anything else, is relationships, Eric Doden, the CEO of Greater Fort Wayne Inc., believes.
Getting that first face-to-face meeting that can lead to a profitable relationship is why the region’s economic development executives – in effect the region’s sales force – will be hitting the road in 2016 to an extent not seen before, Doden said recently.
Each of the 24 sales people who represents Allen County and the region’s other county economic development organizations has made a commitment to travel from five to 10 weeks a year and make 50 to 75 visits to businesses outside of the region. While those hundreds of initial visits themselves are unlikely to bring new companies into the area, beginning and nurturing those relationships over the next few years can, Doden believes.
When a firm is looking to expand or relocate to a new area, it usually picks about five regions and then narrows it down from there, Doden said. “You want to make sure you have the relationship that you are in the top five. And then you have a shot at winning.”
Although property tax breaks and other incentives also help, “Indiana wins a lot without giving the most incentives,” said Doden, who was the director of the Indiana Economic Development Corp. for 2.5 years. “Incentives are short term. They’re not a long term operational model.”
What has impressed Ryne Krock, who came to the LaGrange County Economic Development Corp. eight months ago after working several years in the Toledo mayor’s office, is the level of cooperation among area governments and economic development entities.
“The collaboration in northeast Indiana is unlike anything I’ve ever seen,” he said. “In working over in Toledo, we had networking relationships but nothing like the collaboration here.”
While some in more rural counties such as LaGrange may see Allen as a threat, “I don’t at all,” Krock added.
“That’s why the collaboration aspect is so exciting.”
Doden said Fort Wayne and Allen County have not just a responsibility to their own residents, but to the residents of the other counties in the greater Fort Wayne area.
“Each of the counties is of course important, but …we feel like we have a huge responsibility to work really hard and help the best of our businesses grow and expand,” he said.
Serving existing customers
In DeKalb County, as is the case across the region, at least 80 percent the time and effort expended by economic development advocates is in helping existing businesses expand, said Ken McCrory, executive director of the DeKalb County Economic Development Partnership.
In 2015, the county scored about $50 million in new investment – a middle-of-the-road performance, McCrory said. But over the last six years or so, it also has been able to bring in at least one new industry a year.
In 2015, the newbie was Janus International, a manufacturer of steel and roll-up doors that pledged to create 50 jobs initially and 50 more down the road.
Noble County saw an investment of $33 million in real and personal property in 2015, all from existing industries, said Rick Sherck, executive director of the Noble County Economic Development Corp. The expansions came with promises to create 184 new jobs, although that was pretty much “a wash” because of other jobs that were lost to cutbacks, primarily by Symmetry Medical and Superior Essex.
“What we’re really working hard at is product development,” Sherck said, the “product” in question being the right combination of industrial sites, buildings, development incentives and a skilled workforce.
“We’re trying to build the product that will serve the existing industries we have here today and do that well,” he said. “We’re working very hard to take care of that current customer, which we think will make it easier for us to attract new customers. We’ve been very fortunate to have a lot of industries expand, and what a great marketing tool it is when you can say in 2015 nine industries expanded in Noble County.”
Manufacturing represents the largest segment of jobs in most northeast Indiana counties, accounting for 40 percent or even more of the employment in DeKalb and Noble. That is both a blessing and a curse, McCrory said.
“We have to be careful. I don’t see manufacturing as a problem, I see the lack of diversity as a problem. And that we are very much aware of,” he said.
During the Great Recession in 2008, unemployment rates reached about 15 percent because of the enormous losses in manufacturing jobs.
“With more people back at work now, we try to concentrate a little more on diversifying, meaning, in addition to the automotive and fabrication industries, can we add biomedical? Can we add processing? Can we take that manufacturing knowledge and skill and apply that to other forms of manufacturing?” McCrory said.
With unemployment levels now at around 4 percent, workforce has become a big issue for most northeast Indiana counties.
“The interesting thing is, there is certainly a skills gap, but even more than that it’s a lack of available workers,” Krock said. “Employers are willing to train folks in house, or give them training or certification from outside, but just finding the people to do it has been a huge challenge.”
LaGrange is as heavily dependent on the recreational vehicle industry as is its neighbor Elkhart County.
“I think the line between LaGrange County and Elkhart County is kind of blurred,” Krock said. “There’s a lot of workforce that travels across that line every day, so it’s critical to work together with the Elkhart EDC on workforce issues.”
There is also a downside when the RV business is thriving as it is now.
“It makes it extremely difficult for every other manufacturer to hire because the RV manufacturers are paying very, very good wages,” Krock added.
Housing – or the lack of it – has been another problem in LaGrange, which is doing a comprehensive study on the issue. Currently, workers commute to work in LaGrange not just from other Indiana counties, but from Michigan and Ohio.
“How can we expect to (bring in) that workforce if people want to move here and they can’t find a place to live?” Krock said.
In Noble County, a lot of attention is being paid to developing the existing workforce. In collaboration with WorkOne and its local industries, the county offered industry-recognized training in skilled jobs such as CNC machining, welding and maintenance technology, Sherck said. Seventy people completed the training in 2015, with the promise from their employers that promotions and/or raises would follow.
In 2016, the county is rolling out a new, 40-hour basic manufacturing skills training program for the under-employed: people stuck in low paying fast food, retail and other jobs.
“We’re looking for someone who shows up every day and does a great job, but they don’t know where they can go from there,” Sherck said. “We’re going to give them some basic manufacturing skills, and we have 16 industries that are willing to consider hiring them after completion.”
Although one program is offered through employers and the other on an individual basis, the two will complement each other, he said.
“We’re upskilling people already in the industry to fill in some gaps, and then trying to backfill those positions with people that we’re going to call underemployed, and try to find them not a job, but a career in manufacturing.”
One thing McCrory hopes to do in 2016 is focus on the building side of employer attraction and expansion.
“Quite honestly, in DeKalb County and I think you’ll find this elsewhere …we’re out of buildings,” he said.
But rather than just getting a toe wet by constructing a single spec building, McCrory would like to see the county launch a longer term, comprehensive spec building program.
In Delaware County, for example, “they have a program devised so that once that first shell building is gone, they do another one and another one and another one. That’s where I think we need to be and I’ve talked to my board about it and hopefully we’ll go that way,” he said.
Noble County is likely to take a more conservative approach, Sherck said. The county has three certified shovel-ready sites – in Ligonier, Albion and Kendallville – and hopes to add a fourth in 2016 in Avilla. But it hasn’t attempted spec buildings.
“It can be a risky business. It’s a speculative business, so if you do a spec building you’ve got to do it in such a way that it doesn’t put the community at risk in the long term,” he said. “We’ve had the conversation but have not aggressively pursued it as of yet. We’ll let the community drive that decision. It won’t be an EDC decision.”
With northeast Indiana’s win of $42 million in funding through the state’s Regional Cities Initiative, the area’s economic development capabilities will be enhanced, Doden believes.
“It will increase momentum and community pride. Economies aren’t just about numbers. They’re about what you believe and what you feel…and an emotional connection to your community,” Doden said. “It is becoming a source of community pride that we have a vision and a mission and we’re going to go out and accomplish that.”