northwest indiana regional data snapshot

Northwest Indiana Region

REGIONAL SNAPSHOT

Overview01Demography02Human capital03

Labor force04Industry and occupation05Conclusions06

Table of contents

01overview Northwest Indiana Region

What is a regional snapshot?

4

The Northwest Indiana Region is located in the upper northwest tier of the state and is part of the Chicago metropolitan region. Major interstates, including I-90, I-94, I-65 and I-80, traverse through the region. Indiana Toll Road passes through this portion of the state. The region is comprised of the following Indiana counties: LakeLaPortePorter

Overview

section 01

Northwest Indiana Region

5

Overview

section 01

What is a regional snapshot?What is the snapshot?The regional snapshot is a demographic and economic assessment of the Northwest Region in Indiana. Using county-level data, PCRD analyzed a number of indicators to gauge key patterns and trends in the region.

What is its purpose?The snapshot is intended to inform local and regional leaders, organizations and residents of the key attributes of the region’s population and economy. In particular, it takes stock of the region’s important assets and challenges. With such data in hand, regional leaders and organizations are in a better position to invest in the mix of strategies that will spur the growth of the economy and provide a higher quality of life for residents of the Northwest Indiana Region.

What are its focus areas?PCRD secured and analyzed recent data from both public and private sources to generate the snapshot. In order to build a more comprehensive picture of the region, the report presents information under four key categories: Demography Human CapitalLabor ForceIndustry and OccupationWhen appropriate or relevant, the report compares information on the region with data on the remainder of the state of Indiana. By so doing, the region is better able to determine how well it is performing relative to the state on a variety of important metrics.

02demography Population change

Population pyramids

Income and poverty

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Demography

section 02

Population change

In 2013, the population in the Northwest Region represented almost 11.7 percent of the overall Indiana population, compared to 12.1 percent in 2002. If the trend holds, the Northwest Region population will continue to represent about 12 percent of Indiana’s overall population.The Northwest Indiana Region experienced a population gain of 3.4 percent between 2002 and 2013. The rest of the state grew by more than 7 percent during that same time period. Source: U.S. Census Bureau: Population Estimates 2013, STATS Indiana

744,067 769,294

799,946

2013-2020

2002-2013

2002

Total population projections

Northwest RegionRest of Indiana

+ 3.4%5,801,608

6,052 175 5,411,90

0

+ 4.0%

+ 7.2%

+ 4.3%

It is estimated that the region’s population will increase around 4 percent over the 2013 to 2020 period. The rest of Indiana is expected to grow by 4.3 percent (250,567 people) over that same period of time.The Northwest Indiana Region gained population, albeit at a slower pace than the rest of the state over the past decade. However, the region’s population is expected to keep pace with the remainder of the state between 2013 and 2020.

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Population pyramidsPopulation pyramids are visual representations of the age distribution of the population by gender.

Demography

section 02

Males outnumber females in the younger age cohorts (specifically in the 0 to 29 years range) in the Northwest Indiana Region and the rest of the state. The share of Northwest’s population that is 50 years old and over constitutes 35 percent (or 270,653 people) of the overall population compared to 34 percent of the population in the rest of the state. Additionally, the two oldest age

groups (70-79 and 80 plus years old) make up nearly 10 percent of Northwest’s population, slightly higher than the 9 percent of the population found in this age grouping in the rest of the state. When contrasted with the remainder of the state, the Northwest Region has a smaller proportion of people in the following younger age categories: 0-9, and 20-29 years old.

Source: U.S. Census Bureau: Population Estimates, 2013 version

Male Female

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Income and povertyDemography

section 02Source: U.S. Census Bureau – Small Area Income and Poverty Estimates (SAIPE)

2002 2008 2013

Total Population in Poverty 13% 18% 21%

Minors (Age 0-17) in Poverty 14% 21% 25%

Average Real Median Household Income*

$54,195 $56,034 $51,596

Real Personal Income ($ 2013) $35,661 $38,247 $39,370

The average real median income across households in the Northwest Indiana Region increased from $54,195 to $56,034 between 2002 and 2008 but slipped to $51,597 by 2013. On the other hand, real personal income increased in the 2002 to 2013 period (from $35,661 to $39,370), possibly the result of increasing income inequality in the region.

Meanwhile, the proportion of the population classified as living in poverty increased steadily from 2002 to 2013, as did the proportion of minors in poverty. Nearly 21 percent of residents, and 25 percent of minors, in the region were classified as impoverished in 2013.

* Weighted real median income, weighted by county population

03 human capital Educational attainment

Graduation rates

Patents

11

Human capital

section 03

Educational attainment

Associate’s degreeBachelor’s degreeGraduate degree

No high schoolSome high schoolHigh schoolSome college

Source: 2013 ACS 5-year estimates

Educational attainment is an important indicator of the skills of a population.

In 2013, 36 percent of Northwest residents (25 years of age or higher) had a high school education, 1 percentage point higher than the rest of the state.

However, the proportion of adults with a bachelor’s degree or more was lower in the Northwest Indiana Region compared to the rest of the state (20 percent versus 24 percent). On the other hand, the percentage of adults with an associate’s degree was the same in both the Northwest Indiana Region and the remainder of the state.

In general, adult residents of the Northwest Region have an educational attainment profile that mirrors that found in the remainder of the state. The only exception is at the higher educational tier. About 20 percent of adults in the region have a baccalaureate degree or higher, 4 percentage points lower than that found in the rest of the state.

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Human capital

section 03

Four-year high school graduation ratesMore than eight of every 10 Northwest Region students successfully graduated from high school after four years (in 2010). This was almost 3 percentage points behind the rest of Indiana. The rate for four-year graduates rose to 89.6 percent by 2014 in the Northwest Region, a figure that continued to lag behind the rate for the rest of the state. However, the graduation rate gap decreased by about 1.6 percentage points in 4 years.High schools in the Northwest Indiana Region have increased their graduate rates; however, the rest of the state still outperforms the region.

Source: datacenter.kidscount.org

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section 03

Average patents* (2001-2013)Human capital

The number of patents issued is an important indicator of the level of innovation in a region. Furthermore, success in commercializing these innovations can lead to long-term growth for a region.

When it comes to innovation, the Northwest region is lagging behind the rate for the rest of the state.The data make clear that the Northwest Indiana Region needs more efforts in creating a culture of innovation.

*Average patents refers to the average patent rate overtime, either patents per jobs or patents per residents. Source: U.S. Patent and Trademark Office, EMSI, U.S. Census: Population Estimates

Note: Patent origin is determined by the residence of the first-named inventor. Since many workers commute into the region, the number of patents produced in the region could behigh. However, among residents of the region, patent production is relatively low.

Average Patents per 10,000 residents,2001-2013From 2001 to 2013, 0.7 patents per 10,000 residents were issued in Northwest counties. The rest of Indiana amassed 2.2 patents per 10,000 residents.

Average Patents per 10,000 Jobs,

2001-2013From 2001 to 2013, Northwest

counties were issued patents at a rate of 1.6 per 10,000

jobs, while the remaining Indiana counties garnered 4

patents per 10,000 jobs.

04labor force Unemployment rates

Earnings per worker

Labor shed andcommuter shed

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Labor force

section 04

Unemployment rates Prior to the onset of the Great Recession around 2008, the Northwest Region’s unemployment rate was slightly higher than the rest of the state.The major spike in the region’s unemployment rate occurred at the start of the recession in 2008, resulting in an unemployment rate of 10.6 percent by 2009, slightly higher than the figure for the rest of Indiana. While the unemployment rate gap between the region and the rest of the state began to close in 2010 and 2011, it increased in 2013. The unemployment in the region was 1.5 percentage points higher than the rest of the state by 2013. Northwest’s unemployment rate was just shy of 9 percent in 2013.

Source: U.S. Bureau of Labor Statistics – Local Area Unemployment Statistics

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Labor force

section 04

Real earnings per workerThe real earnings* per worker was constructed by averaging earnings for all industries in the Northwest Region and the rest of Indiana.The Northwest Region and the rest of Indiana registered an increase in real earnings per worker over the 2008 to 2013 time period, but the rate of growth was modest. As a result, the earnings gap between the two regions decreased slightly.Real earnings per worker in the Northwest Region remained nearly $1,000 dollars above the amount earned by workers in the rest of Indiana in 2013.

NorthwestRegion

Rest of Indiana

2008 2013

*Earnings include wages and salaries, supplements and other proprietorship incomes

Source: Economic Modeling Specialists International (EMSI) – EMSI 2014.3 Class of Worker Data (QCEW, non-QCEW, self-employed and extended proprietors)

17

Labor force

section 04

Labor shed

Source: LEHD, OTM, U.S. Census Bureau

A region’s labor shed is the geographic area from which it draws employees.In 2011, the Northwest Region was employed at total of 290,000 people. Almost 22 percent of these individuals traveled from surrounding counties to work in the region. On the other hand, 78 percent of jobs in the region were held by Northwest residents.

In a nutshell, almost four-fifths of the region’s labor force is comprised of people who both live and work in the Northwest Region (in 2011).

Population 2011 Jobs*

Proportion

Employed in Northwest 290,000 100%Employed in Northwest but Living Outside 64,454 22%

Employed and Living in Northwest 225,546 78%

In-Commuters Same Work/Home

*most recent data available

64,454 225,546

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Labor shed in 2011Labor force

Source: U.S. Census Bureau, OTM, LEHD, PCRD

The Northwest Region draws its labor force largely from its own counties and surrounding counties.Seventy-five percent of the region’s workers come from two of the three counties that make up the Northwest Region: Lake County and Porter County, Indiana.

Extending the threshold to 80 percent, LaPorte County, Indiana, the third county of the Northwest Region, enters into the labor shed region.

Cook County, Illinois, and Jasper County, Indiana, are part of the 85 percent labor shed region. section 04

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Labor force

section 04

Commuter shed

Source: LEHD, OTM, U.S. Census Bureau

*most recent data available

A region’s commuter shed is the geographic area where its residents work.Nearly 31 percent of employed residents in the Northwest Region commute to jobs located outside of the region. The remaining 69 percent of the region’s workforce both live and work in the Northwest Region.

Out-Commuters Same Work/Home

101,061 225,546

Population 2011 Jobs*

Proportion

Employed Northwest Residents 326,607 100%Living in Northwest and Employed Outside 101,061 31%

Living and Employed in Northwest 225,546 69%

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Commuter shed in 2011Labor force

Source: U.S. Census Bureau, OTM, LEHD, PCRD

The Northwest Indiana Region’s commuting pattern involves a small number of counties, all located in the region or in nearby Cook County, Illinois.Approximately 75 percent of the residents who live in the region and are part of the labor force are employed in three counties: Lake and Porter Counties in Indiana and Cook County, Illinois . Clearly, a large number of residents commute to Chicago for work purposes.

Another major work location for the region’s residents is LaPorte County, Indiana. Including LaPorte County in the commuter shed accounts for 85 percent of the Northwest Region’s residents’ work locations.

section 04

05industry and occupation

Establishments

Employment by industry

Cluster analysis

Top occupations

STEM occupations

22

Industry and occupation

section 05

Establishments

Source: National Establishment Time Series (NETS) – 2012 Database

Number of Establishments by Employment SizeYear 2000 2011Stage 0 6,155 14,141 Stage 1 16,427 30,340 Stage 2 5,534 5,320 Stage 3 438 428 Stage 4 69 55 Total 28,623 50,284

The number of establishments in the Northwest Indiana Region grew sharply between 2000 and 2011. Impressive growth occurred in Stage 0 and Stage 1 establishments. In particular, Stage 0 establishments grew by 130 percent, while Stage 1 establishments expanded by 85 percent.

Stage 2 establishments slipped by 4 percent between 2000 and 2011, and Stage 3 establishments decreased by 2 percent. Furthermore, Stage 4 establishments that employ 500 people or more also declined, falling from 69 to 55 establishments between 2000 and 2011.

An establishment is a physical business

location. Branches, standalones

and headquarters are all considered types of

establishments.

Definition of Company Stages0 12 3

4

Self-employed

2-9 employees

10-99employees

100-499employees

500+employees

*The most recent Reference USA data shows 48 stage 4 establishments for Norwest Region, as compared to 55 establishments from NETS database.

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section 05

Establishments’ component change


The Northwest Region gained 21,661 new establishments between 2000 and 2011. Most of the gain came from natural change (births minus deaths of establishments). Births surpassed deaths by 20,830 establishments.More establishments migrated into the Northwest Region than migrated out to locations in non-Northwest counties. The result is a net gain of 831 establishments from migration.

Components of Change for Establishments

Total Change (2000-11) 21,661

Natural Change (births minus deaths) 20,830

Net Migration 831

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section 05

Establishments


Number of Jobs by Establishment StagesYear 2000 2011Stage 0 6,155 14,141 Stage 1 62,131 92,213 Stage 2 139,295 137,064 Stage 3 76,019 73,639 Stage 4 82,478 66,307 Total 366,078 383,364

From 2000 to 2011, the number of jobs increased, mainly due to job gains in Stage 0 and Stage 1 establishments.The self-employed (Stage 0) and small Stage 1 establishments had impressive gains in jobs between 2000 and 2011. Stage 2 establishments that employ 10 to 99 workers suffered a slight drop in jobs (2 percent), while Stage 3 establishments lost 3 percent of their positions. However, the largest firms (Stage 4) experienced employment decline of nearly 42 percent. The net result is an overall increase of approximately 17,000 jobs in the region between 2000 and 2011.

Aggregate Sales (2013 US$) by Establishment StagesYear 2000 2011Stage 0 $ 872,863,050 $ 984,160,892 Stage 1 $ 9,108,074,617

$ 7,901,880,694

Stage 2 $ 18,317,186,331 $

14,785,496,590 Stage 3 $ 11,630,909,227

$ 9,710,820,180

Stage 4 $ 14,827,233,530 $

7,689,367,244 Total $ 54,756,266,756 $

41,071,725,600

Establishments’ total sales decreased in the Northwest Region between 2000 and 2011.The decline in sales touched all establishment stages over the past decade, with the exception of the Stage 0 establishments that experienced a 13 percent increase in sales. Specifically, the sales for Stage 1 establishments slipped by 13 percent, Stage 2 by 19 percent and Stage 3 by 17 percent. Sales for firms employing 500 or more workers dropped by 48 percent. Overall, sales decreased from $54.7 billion to $41 billion over the time period.

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section 05

Top five industries’ employment growth

NAICS Description 2008 Jobs 2013

JobsChang

eChange

(%)Northwest Region

72 Accommodation and Food Services 27,028 29,897 2,869 11%62 Health Care and Social Assistance 48,256 49,740 1,484 3%81 Other Services (except Public Administration) 23,228 24,474 1,246 5%56 Administrative and Support and Waste Management and

Remediation Services 17,749 18,655 906 5%52 Finance and Insurance 10,618 11,468 850 8%

Rest of Indiana62 Health Care and Social Assistance 323,998 357,407 33,409 10%56 Administrative and Support and Waste Management and

Remediation Services 173,273 195,535 22,262 13%72 Accommodation and Food Services 220,863 232,113 11,250 5%53 Real Estate and Rental and Leasing 103,492 113,752 10,260 10%52 Finance and Insurance 129,447 139,326 9,879 8%

By total employment, the fastest-growing industry in Northwest Indiana between 2008 and 2013 was Accommodation and Food Services. In contrast, Health Care and Social Assistance was the fastest growing industry in the rest of the state.

The other top industries in the Northwest Region (in terms of job gains) included Health Care and Social Assistance, Other Services, Administrative and Support and Waste Management and Remediation Services, and Finance and Insurance.


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section 05

Top five industries’ employment decline

NAICS Description 2008

Jobs2013 Jobs

Change

Change (%)

Northwest Region90 Government 45,772 42,623 -3,149 -7%31 Manufacturing 45,564 42,806 -2,758 -6%23 Construction 26,107 23,391 -2,716 -10%44 Retail Trade 44,822 43,633 -1,189 -3%71 Arts, Entertainment, and Recreation 11,752 10,835 -917 -8%

Rest of Indiana23 Construction 183,424 158,078 -25,346 -14%31 Manufacturing 487,263 462,502 -24,761 -5%90 Government 410,801 397,715 -13,086 -3%42 Wholesale Trade 110,005 105,515 -4,490 -4%51 Information 43,439 40,968 -2,471 -6%

Government, Manufacturing and Construction were the industry sectors that experienced the largest job declines in the region between 2008 and 2013. These were the same industry sectors most negatively impacted in the rest of Indiana as well.

Declines also occurred in the Retail Trade and Arts, Entertainment and Recreation sector in the Northwest Region. As for the rest of the state, the top industries ranking fourth and fifth in job losses were Wholesale Trade and Information.


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How to interpret a bubble chartThe graph’s four quadrants tell a different story for each cluster.


section 05 Modified from: http://www.charlestonregionaldata.com/bubble-chart-explanation/

EmergingBottom right(weak but advancing)

StarsTop right (strong and advancing)

MatureTop left

(strong but declining)

TransformingBottom left (weak and declining)

Contains clusters that are more concentrated in the region and are growing. These clusters are strengths that help a region stand out from the competition. Small, high-growth clusters can be expected to become

more dominant over time.

Contains clusters that are more concentrated in the region but are declining (negative growth). These clusters typically fall into the lower quadrant as job losses cause a decline in concentration.

Contains clusters that are under-represented in the region but are growing, often quickly. If growth trends continue, these clusters will eventually move into the top right quadrant. Clusters in this quadrant are considered “emerging” strengths for the region.

Contains clusters that are under-represented in the region (low concentration) and are also losing jobs. Clusters in this region may indicate a gap in the workforce pipeline if local industries anticipatea future need. In general, clusters in this quadrant show a lack of competitiveness.

http://www.charlestonregionaldata.com/bubble-chart-explanation/

28


section 05 Note: Label includes cluster name, LQ 2013, and Employment 2013

Industry cluster bubble chart

Source: Economic Modeling Specialists International (EMSI) – EMSI 2014.3 Class of Worker Data (QCEW, non-QCEW, self-employed and extended proprietors), industry

cluster definitions by PCRD

Transforming Emerging

Mature Star

% Change in LQ, 2008-2013

LQ,

2013

29


section 05 Note: Label includes cluster name, LQ 2013, and Employment 2013

Manufacturing supercluster bubble chart

Source: Economic Modeling Specialists International (EMSI) – EMSI 2014.3 Class of Worker Data (QCEW, non-QCEW, self-employed and extended proprietors), industry

cluster definitions by PCRD

% Change in LQ, 2008-2013

LQ,

2013

Mature

Transforming

Star

Emerging

30

Bubble chart resultsIndustry and occupation

section 05

StarsAdvanced MaterialsChemicals & Chemical Based ProductsEnergy (Fossil & Renewable)Glass & CeramicsManufacturing Supercluster

Primary Metal Fabricated Metal Product

EmergingAgribusiness, Food Processing & TechnologyBusiness & Financial ServicesForest & Wood ProductsInformation Technology & TelecommunicationsPrinting & Publishing Manufacturing Supercluster

Computer & Electronic Product Mining Electrical Equip, Appliance & Comp.

Manufacturing Transportation Equipment

TransformingArts, Entertainment, Recreation & Visitor IndustriesDefense & SecurityEducation & Knowledge CreationApparel & Textiles

MatureBiomedical/Biotechnical (Life Sciences)MiningManufacturing Supercluster

MachineryTransportation & Logistics

Percent Growth in Specialization

Leve

l of S

peci

aliz

ation

Source: Economic Modeling Specialists International (EMSI) 2014.3 Class of Worker, industry cluster definitions by PCRD

31

Bubble chart interpretationIndustry and occupation

section 05

Mature IndustriesFew industry clusters in the Northwest Region are in the Mature stage. Mature clusters are relatively concentrated, but their growth is trending downward. Biomedical/Biotechnical, Mining, Transportation and Logistics, and Machinery Manufacturing are the mature clusters. It is worth noting, however, that the Northwest Region may find it worthwhile to invest in efforts to shore up the concentration of some of these industries if they are deemed important to the future economy of the region.

Transforming IndustriesTransforming clusters are relatively small and declining industries. In the Northwest Region, the Defense and Security, Arts and Entertainment, Education and Knowledge Creation and Apparel and Textile clusters are transforming industries. Any amount of growth in these industries would require relatively large investments.

STAR IndustriesThe most highly concentrated Star industry cluster in the Northwest Region is Primary Metal Manufacturing with a location quotient (LQ) of 24. Significant star clusters include Advanced Materials and Manufacturing with around 30,000 jobs each. Other Star clusters include Transportation and Logistics, Energy, Chemicals and Glass and Ceramics. The region has significant transportation assets with several interstates and freight railroads. Proximity to Chicago is an advantage as significant logistics assets and warehousing are being developed in the Chicago-Joliet metropolitan area.

Emerging IndustriesIndustry clusters that may be poised for growth are classified as “Emerging.“ In the Northwest Region, several industry clusters are Emerging. These clusters have gained strength from 2008 to 2013 and may emerge as important economic forces in the future. Clusters that are worthy of note are the three Manufacturing subclusters noted in the previous slide, as well as IT and Telecommunications.

32


section 05

Top five occupations in 2013

Source: Economic Modeling Specialists International (EMSI) – 2014.3 Class of Worker

The top five occupations in the Northwest Indiana Region account for 48 percent of all jobs. The largest occupation classification consists of Sales and Related occupations, with 13 percent of all jobs in the region linked to this category. This is followed closely by Office and Administrative Support occupations at 12 percent.Rounding out the top five occupations in the region are Food Preparation and Serving Related occupations at 9 percent, Production occupations at 7 percent, and Transportation and Material Moving occupations at 7 percent of all jobs in the Northwest Region.

33


section 05

STEM and STEM-related occupations

STEM (Science, Technology, Engineering and Math) jobs decreased slightly in the Northwest Region, a trend that was at odds with the rest of Indiana during the post Great Recession recovery period. The decline in STEM occupations in Northwest Indiana was due to job losses in computer and mathematical occupations, as well as engineers, architects, and sales and related occupations between 2008 and 2013.

76,541 75,891 -0.8%

Change2013

2008

Job change in STEM occupationsNorthw

est RegionRest of Indiana

743,344

1.2%734,571

STEM jobs in the Northwest Indiana Region dropped by 0.8 percent, compared to a 1.2 percent growth in the rest of the state, between 2008 and 2013.


06conclusions

35

Conclusions

section 06

Northwest Region: Key opportunitiesThe Northwest Indiana Data SnapShot report highlights a variety of data that paint a mixed picture of the present state of the region. The information offers local leaders, organizations, agencies and residents with food for thought in how to build on the existing and emerging assets of the region.

Demography•The Northwest Region demographic profile similar to the rest of Indiana. Despite a slightly older population, the percentage of people in the region in prime working age cohorts is very similar to the rest of the state. The region should assess its capacity to address the needs and opportunities associated with an aging population.

Human Capital•The educational level of adults in the region is aligned with those of the rest of the state, although the percentage with at least baccalaureate degree is slightly lower in the Northwest Region. Assess the human capital and workforce needs of firms in the region and determine how well the skills of the labor force sync with them.

Economic Development•Assess the human capital attributes of residents who commute to work outside of the region. Those endowed with medium or high level skills may represent a prime source of labor for new or expanding companies in the region.

•Focus attention on the needs and opportunities of Stage 1 and Stage 2 establishments, since they are key sources of jobs and sales in the region. These establishments will likely serve as key generators of new jobs in the region.

•Consider investing in the Star and Emerging industry clusters that align with the long-term goals of the region. These are the areas in which the region has a competitive economic edge relative to the nation as a whole.

Contact Us:The Purdue Center for Regional Development is available to assist with more in-depth data or program support to the Northwest Indiana Region, as needed. Please check the back panel of this report for contact information.

36

Report ContributorsThis report was prepared by the Purdue Center for Regional Development in partnership with Purdue University Extension.

Data AnalysisIndraneel Kumar, Ph.D.Ayoung Kim

Report AuthorsFrancisco ScottBo Beaulieu, Ph.D.

Report DesignTyler Wright

This report was supported, in part, by grant #00048765 from the Economic Development Administration as part of its investment in the Purdue University’s EDA University Center project titled “Align, Link and Leverage University Assets to Build Regional Economic Ecosystems that Support High-Growth Entrepreneurship.”

For more information, please contact:

Dr. Bo Beaulieu, PCRD Director: [email protected]

Or

765-494-7273

The Purdue Center for Regional Development (PCRD) seeks to pioneer new ideas and strategies that contribute to regional

collaboration, innovation and prosperity.

September 2015

northwest indiana regional data snapshot

Data & Analytics