Thousands of northeast Indiana residents earn a living in the defense industry. And by 2014, 4,000 more will.
To prepare for that growth – and to get a better handle on what’s already here – a group of industry leaders and economic development specialists has been meeting since April.
Formation of the group, or cluster, is the first step in the Northeast Indiana Business Cluster Initiative, an attempt to foster economic development by identifying promising sectors and working with government and industry players to clear hurdles to growth.
The defense cluster wasn’t the first planners intended to focus on, said Mark Becker, executive director of the Northeast Indiana Community Foundation. But it was bumped up after the Lilly Foundation in March put up $20 million to assist efforts to grow the industry.
The primary players in the defense industry are thought to employ at least 7,600 in the region, according to IPFW’s Community Research Institute.
Regional leaders in the defense industry say they could add up to 4,000 jobs over the next five years, but they need help – particularly with developing the workforce. Fort Wayne-based ITT Communication Systems maintains offices as far away as California. But President Ken Peterman in May said that wouldn’t be necessary if ITT Communications could attract enough top-flight engineers and other professionals to Fort Wayne.
“We have to try to hire into Fort Wayne and retain workers in Fort Wayne,” Peterman said.
Defense contractors in many cities have trouble finding enough talent, said ITT spokesman Tim White, who participates in the defense cluster.
“It’s not a unique problem to Fort Wayne,” White said. “We need to do a better job solving it than other communities.”
One way to do that is to produce that talent in greater numbers at regional universities. Toward that end, the Lilly grant will give Indiana University-Purdue University Fort Wayne $4.5 million for two new professor positions and equipment for its systems engineering and wireless communications programs.
Becker said the money will be spent with direct input from the defense cluster, which includes representatives of ITT, Raytheon Systems Co., BAE Systems Inc., Northrop Grumman Corp. and General Dynamics Corp. in Fort Wayne and Undersea Sensor Systems Inc. in Columbia City.
John Stafford, director of the Community Research Institute, says getting an accurate count of current defense industry employees is still a work in progress.
“It’s fairly complex,” he said. “There’s no right answer to the question right now.”
But participants in the cluster say northeast Indiana boasts a heavy defense presence.
“It’s unusual for a city our size to have the number of major defense contractors we have here,” said Bruce Menshy, director of operations at Raytheon’s Fort Wayne facility and co-chair of the defense cluster.
One goal for the defense cluster – and all the others being formed – is to develop more precise data on defense-sector employers in northeast Indiana.
“We’re just in the initial stages of gathering data,” Menshy said.
The defense cluster has a pretty good handle on who the major defense companies in the region are, but it’s a much bigger job identifying all their suppliers – especially since many work with multiple industries, Menshy said.
And Stafford said the job also depends on how widely or narrowly the group defines the defense industry.
The defense cluster is furthest along on its work, but clusters in the medical devices and food processing industries have held initial meetings in recent weeks with a facilitator provided by the Northeast Indiana Foundation.
Clusters in transportation and logistics, advanced manufacturing and financial services also are in the works, Becker said. The initiative is being funded with $75,000 grants each from the Indiana Economic Development Corp. and the Lincoln Foundation.
Each cluster will produce a map of employers in the region, analyze strengths, weaknesses, opportunities and threats to the industry and write strategic action plans within six months of their formation.
“It will help us to better allocate our scarce resources for economic development,” Becker said.
And as regional players appeal to the legislature, IEDC, Lilly Foundation and others for more, they’ll be able to make a better, more specific case because of the work done by the cluster, Becker said.
As a side benefit, the clusters spur interaction among businesses and with governmental agencies and schools.
“A lot of these companies have never collaborated, but they’re seeing some benefits,” Becker said.
As the defense companies have collaborated, they’ve learned they need to get the word out to young people that defense is a growth industry in Indiana and it promises good jobs to qualified candidates.
One area defense contractor that asked not to be named out of competitive concerns said it typically pays production workers $16 to $20 an hour and engineers $59,000 to $79,000 a year.
To help people get those qualifications, the Lilly grant also is giving WorkOne Northeast $5.7 million to retrain workers for the industry, $2.6 million to Ivy Tech Community College for new equipment and $5 million to help start magnet schools that emphasize science, math and technology.
But Menshy said the defense cluster also plans outreach.
“We want to go to high schools, even elementary schools, and get students excited and know there are a lot of good jobs out there,” Menshy said.
