Luncheon presentation shows Indy area lags behind in growth

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Indiana University Public Policy Institute Senior Analyst Drew Klacik accepted an offer to explain why Indianapolis was not selected for Amazon’s headquarters or operations center.

Klacik addressed the issue at the Feb. 13 OneZone luncheon at Ritz Charles in Carmel.

Amazon originally planned two headquarters but canceled its plans to put one in New York City the day after Klacik’s talk. There are still plans for a headquarters in Arlington, Va., near Washington, D.C. Nashville, Tenn., was previously selected for an operations center with 5,000 jobs. The Indianapolis area was one of the metropolitan areas under consideration.

Klacik said the Indianapolis area was most likely being considered for the operations center, which wasn’t previously announced as part of Amazon’s plan.

“We’ve made a lot of progress since 1984 in central Indiana,” Klacik said. “But in many ways, the progress has been made by individual communities and individual structures. All those individual victories haven’t added up to make a dramatic difference relative to other places.”

Klacik compared the Indianapolis-metro area to metro areas of Nashville, Milwaukee, Pittsburgh, Raleigh, N.C., Austin, Texas and Columbus, Ohio.

“Only Milwaukee and Pittsburgh grew slower between 2011 and 2016 than we did (in population),” Klacik said.  “We are growing our share of people with a bachelor’s degree slower than other places. Typically, it’s easier to grow faster when you have less.”

Klacik said Indianapolis is in the middle as far as job growth.

“Clearly, we don’t want to be Pittsburgh, and we’re happy we’re not Milwaukee,” Klacik said. “Out of the 100 (metro areas), we are 40th, so we are doing a pretty good job of growing jobs. But the jobs we grow turn out not to pay very well because we have the second lowest.”

Klacik said studies show the Indianapolis area is growing jobs and has productive workers, but low wages.

“That almost makes no sense,” Klacik said.

Unfortunately, Klacik said the Indianapolis area is better at growing poverty than most of its counterparts.

“We grew poverty by 6.3 percent at the same time Denver reduced poverty by almost 20 percent,” Klacik said. “I was thinking, how the (expletive) did we get on the list? What is it about us that Amazon had us on their list despite (that) everything looked so awful to me?”

Klacik said firms look for talent in the region, not city or county. Klacik said the challenge for Hamilton County is, how does it help the other areas improve its numbers?

“We have to do a better job of convincing people we are in a very innovative part of the country,” he said. “I suspect Amazon knew that, and part of the reason we were on their list. We’re an awesome producer of talent. We are not as good at retaining that talent. We have to convince our people to stay.”

Klacik said the Indianapolis area should do a better job of making its case that convenient and affordable is an attractive place to live.

Klacik’s final point was: “We have to stop being other places and be the best we can be.”


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