For the second consecutive year, Louisiana’s manufacturing industry received an average grade, while logistics earned above average marks in an annual report produced by Ball State University.
The 2016 Manufacturing & Logistics Report Card measures how each state ranks among its peers in economic indicators of interest to industrial and logistics site selectors.
According to the report, Louisiana rates a C in manufacturing and a B+ in logistics—the capacity to move and process goods, store inventory and manage distribution.
The study also grades Louisiana on its tax climate (C-), expected fiscal liability gap (D), global reach (C), human capital (F), worker benefit costs (B-), sector diversification (D+) and productivity (D+).
“Few factors garner as much policy interest as do state and local taxes,” the report reads. “For firms that may operate virtually anywhere, tax rates matter a great deal in location decisions. Business taxes, individual income taxes, sales, unemployment, insurance and property taxes all play a role in assessing regions for a potential employer location.”
Louisiana’s tax climate declined from a C in 2015 to a C- this year; the state also scored worse this year in sector diversification, dropping from a C- last year to D+ this year. Meanwhile, the state fared better this year in worker benefit costs, which include health care, liability, casualty insurance and workers’ compensation. The state rated a C in 2015 compared to a B+ this year.
Also in a statement, Michael Hicks, director of Ball State’s Center for Business Economic Research in Indiana, says the U.S. manufacturing sector has transformed as the nation has shifted toward more diversified industries. It also requires a better-educated workforce.
“These data underscore the importance of talent development efforts with a focus on educational attainment,” Hicks says. “In the long run, a well-educated and ready workforce matters more than any other single factor in the health of advanced manufacturing firms.”
