BENCHMARKING SOUTH BEND

Transcription

1 BENCHMARKING SOUTH BEND June 18, 2010 Karl King and John Roos

2 TABLE OF CONTENTS Executive Summary 1 Introduction 3 Part 1: Comparing To The Benchmarks 6 The Forbes Rankings 7 Population 9 Housing 14 Education Attainment 16 Workforce 20 Income And Wages 28 K-12 Schools 36 Research And Development 41 Entrepreneurial Activity 45 Innovation Index 46 Industry Clusters 49 Occupation Clusters 56 Part 2: Confronting The Brutal Facts 62 The Brutal Facts 62 A Legacy Industry Mix Is The Root Cause 64 A Vicious Circle Of Economic Decline 67 Part 3: Building Toward Improvement 70 University Of Notre Dame Strategic Research Investments 70 Existing Local Assets And Initiatives 72 Programs Elsewhere That Could Be Models For South Bend 79 Potential Strategies 81 Transforming The Industry Mix--A Solutions Map 82 A Virtuous Circle Of Economic Vitality 84 Appendix A Data Tables 86 Appendix B Endnotes To Data Tables 124 Appendix C Michiana TechConnection Technology Platform Descriptions 128 Benchmarking South Bend ii

3 INDEX OF FIGURES Figure 1: Population Growth South Bend and Indiana Benchmark Metro's 9 Figure 2: Net Migration Rate of Young, Single & College Educated South Bend and Indiana Benchmark Metro's 10 Figure 3: Population Growth South Bend and National Benchmark Metro's 12 Figure 4: Net Migration Rate of Young, Single & College Educated South Bend and National Benchmark Metro's 13 Figure 5: Percentage of Housing Units Occupied South Bend and Indiana Benchmark Metro's 14 Figure 6: Percentage of Housing Units Occupied South Bend and National Benchmark Metro's 15 Figure 7: Weighted Workforce Education Index South Bend and Indiana Benchmark Metro's 17 Figure 8: Weighted Workforce Education Index South Bend and National Benchmark Metro's 19 Figure 9: Labor Force and Employment South Bend and Indiana Benchmark Metro's 21 Figure 10: Labor Force and Employment South Bend and National Benchmark Metro's 23 Figure 11: Other Workforce Indicators South Bend and Indiana Benchmark Metro's 25 Figure 12: Other Workforce Indicators South Bend and National Benchmark Metro's 27 Figure 13: Income South Bend and Indiana Benchmark Metro's 29 Figure 14: Income South Bend and National Benchmark Metro's 30 Figure 15: Average Wages Per Job South Bend and Indiana Benchmark Metro's 32 Figure 16: Median Annual Earnings in Science & Engineering Occupations South Bend and Indiana Benchmark Metro's 33 Figure 17: Average Wages Per Job South Bend and National Benchmark Metro's 34 Figure 18: Median Annual Earnings in Science & Engineering Occupations South Bend and National Benchmark Metro's 35 Figure 19: State Test Results English and Math Proficiency South Bend and Indiana Benchmark Metro's 37 Figure 20: Students With Special Needs Index South Bend and Indiana Benchmark Metro's 38 Figure 21: State Test Results English and Math Proficiency South Bend and National Benchmark Metro's 39 Benchmarking South Bend iii

4 INDEX OF FIGURES (CONTINUED) Figure 22: Students With Special Needs Index South Bend and National Benchmark Metro's 40 Figure 23: Patents Per 10,000 employees South Bend and Indiana Benchmark Metro's 42 Figure 24: Patents Per 10,000 Employees South Bend and National Benchmark Metro's 44 Figure 25: Innovation Index and Components South Bend and Indiana Benchmark Metro's 47 Figure 26: Innovation Index and Components South Bend and National Benchmark Metro's 48 Figure 27: Declining Employment In South Bend's Highest LQ Industries 51 Figure 28: South Bend's Low LQ In Indiana's Growth Industries 52 Figure 29: South Bend's Low LQ In National Growth Industries 53 Figure 30: Occupation Clusters Defined In The Purdue Study 57 Figure 31: South Bend's Low Growth In Its High LQ Occupation Clusters 58 Figure 32: South Bend's Low LQ In Indiana's High Growth Occupation Clusters 59 Figure 33: South Bend's Low Growth In Its High LQ Occupation Clusters 60 Figure 34: South Bend's Low LQ In Nation's High Growth Occupation Clusters 61 Figure 35: Summary of Observations Comparing South Bend to Indiana and National Benchmark Metropolitan Areas 62 Figure 36: Cause Map for South Bend's Unfavorable Comparisons to Benchmark Metropolitan Areas 66 Figure 37: South Bend's Vicious Circle Of Economic Decline 67 Figure 38: Workflow of the Michiana TechConnection Team 76 Figure 39: Solutions Map For South Bend's Legacy Industry Mix 83 Figure 40: South Bend's Virtuous Circle of Economic Vitality 84 Benchmarking South Bend iv

5 EXECUTIVE SUMMARY This report presents data, observations, and conclusions from comparing key demographic and economic attributes of the South Bend-Mishawaka, IN-MI Metropolitan Statistical Area ("South Bend") to benchmark metropolitan areas within Indiana and around the nation. The purpose of this benchmarking is to identify improvements South Bend needs to achieve in order to enhance its economic vitality and compete in the global economy. Accordingly, the metropolitan areas selected as benchmarks are metro's that ranked higher than South Bend in the most recent edition of the respected and widely published "Forbes Best Places for Business and Careers". Our benchmarking observations revealed that South Bend compares unfavorably to the benchmark metropolitan areas in 40 performance measures and structural characteristics. These unfavorable comparisons signal factors South Bend must improve factors which are linked in a network of causes and effects. A root cause analysis of the benchmarking observations, illustrated by the Cause Map in Figure 36, identifies their root cause as a "Legacy Industry Mix". In the Cause Map, "Legacy Industry Mix" is shorthand for the observations that: (i) South Bend's highest concentrations of employment are in the industries which historically shaped South Bend's economy transportation equipment manufacturing and metal products manufacturing but now are industries in which employment is declining nationally, and (ii) South Bend's concentrations of employment are low in the industries in which employment is growing nationally. The Cause Map also reveals that the causes and effects negatively reinforce each other. That is, the negative impact of a cause works its way through the network and returns to exacerbate the original condition, which then sets off repetition of the cycle. Thus, as illustrated in Figure 38, a Vicious Circle of Economic Decline is in operation in South Bend. Nevertheless, several existing local assets and initiatives--as well programs underway elsewhere that might be emulated locally--offer a basis for strategies by which South Bend can transform its present Legacy Industry Mix into a future Growth Industry Mix. Such strategies could include: Capitalize on research at the University of Notre Dame by encouraging research collaborations between Notre Dame and regional industry partners, and supporting local commercialization of growth-industry technologies emerging from Notre Dame. Increase the local availability of financial sources for entrepreneurship and early stage business startup operations. Build a population of technology-intensive and growth industry firms by stimulating innovation and entrepreneurial activity, and nurturing the growth of both first-stage and second-stage companies within the region. Create regional linkages among the counties comprising the South Bend-Mishawaka Metropolitan Area (St. Joseph County, Indiana and Cass County, Michigan) and neighboring counties to enable building a collaborative regional strategy, making strategic investment decisions, and implementing a regional approach to economic development. Facilitate regional and global connectivity between local growth-industry businesses and institutions with their counterparts and clients. Benchmarking South Bend 1

6 Educate, retrain, and retain a workforce that has skills necessary to do the jobs likely to be part of local commercialization of Notre Dame research. If South Bend marshals its assets and activates a driving force for positive change by pursuing such strategies, it can replace the Vicious Circle of Economic Decline depicted in Figure 37 with the Virtuous Circle of Economic Vitality depicted in Figure 40. However, South Bend must recognize--and adopt as a foundation principle--that the following enabling factors will play a critical role in effectively pursuing these strategies: A high level of collaboration and participation by private sector firms, educational institutions, nonprofit and philanthropic organizations, and government entities, Disciplined thinking to maintain a focus on eliminating the root cause the Legacy Industry mix instead of treating its symptoms, and Funding from government agencies, philanthropic organizations, and private sector firms sufficient to pay for activities needed to implement the strategies. Benchmarking South Bend 2

7 INTRODUCTION Why Benchmark South Bend? In the private sector, the purpose of benchmarking is to gain a competitive edge. Benchmarking has become embedded in many successful commercial and nonprofit organizations as a way of keeping at the forefront of the competition. Benchmarking is widely recognized as a valuable tool for: identifying weak areas and what must be done to improve, challenging operational complacency, confirming that there is a need for change, creating an atmosphere conducive to continuous improvement, providing realistic and achievable targets, and enabling key participants to visualize the improvement--which can be a strong motivator for change. Benchmarking can deliver the same benefits to South Bend as government and community leaders strive to achieve continuous improvement in its economic and social vitality. Furthermore, benchmarking that consists of comparison with metropolitan areas which are clearly superior can be a powerful driving force for positive change within the community. In this study, we compare key demographic and economic attributes of the South Bend-Mishawaka Metropolitan Area to those of two sets of benchmark metropolitan areas: Indiana Benchmark Metropolitan Areas and National Benchmark Metropolitan Areas. Both benchmark sets consist of metropolitan areas that are considered clearly superior to South Bend as places for business and careers because they rank higher than South Bend in the 2009 edition of the respected and widely published "Forbes Best Places for Business and Careers" 1. In a competitive global economy these are the kind of cities South Bend will have to equal or surpass in order to move forward. South Bend-Mishawaka Metropolitan Area The South-Bend Mishawaka Metropolitan Area ("South Bend") includes St. Joseph County, IN and Cass County, MI; is 120 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; and had a 2008 population of 316,865. Indiana Benchmark Metropolitan Areas The Indiana Benchmark Metropolitan Areas are the Metropolitan Areas whose principal city is in Indiana, whose ranking in the Forbes.com "Best Places For Business And Careers 2009" list is higher than South Bend's, and whose population is larger than South Bend's: 1 Forbes.com: Best Places For Business And Careers 2009 ( Benchmarking South Bend 3

8 Evansville, IN Metropolitan Statistical Area ("Evansville"), which: includes Gibson County, IN, Posey County, IN, Vanderburgh County, IN, Warrick County, IN, Henderson County, KY, and Webster County, KY; is 103 rd in the Forbes.Com "Best Places For Business And Careers 2009" rankings; and had a 2008 population of 350,261 (110% of South Bend's). Fort Wayne, IN Metropolitan Statistical Area ("Fort Wayne"), which: includes Allen County, IN, Wells County, IN, Whitley County, IN; is 67 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; and had a 2008 population of 411,154 (130% of South Bend's). Indianapolis-Carmel, IN Metropolitan Statistical Area ("Indianapolis"), which: includes Boone County, IN, Brown County, IN, Hamilton County, IN, Hancock County, IN, Hendricks County, IN, Johnson County, IN, Marion County, IN, Morgan County, IN, Putnam County, IN, Shelby County, IN; is 31 st in the Forbes.Com "Best Places For Business And Careers 2009" rankings; and had a 2008 population of 1,715,459 (541% of South Bend's). National Benchmark Metropolitan Areas The National Benchmark Metropolitan Areas are Metropolitan Areas from around the country that meet the following criteria: Higher ranking than South Bend's in the Forbes.com "Best Places For Business And Careers 2009" list, Population between 100% and 300% of South Bend's, Home to the main campus of a research university (i.e., a university that grants doctoral degrees), and Not located in the Sun Belt, the Atlantic coastal region, the Pacific coastal region, a recreation destination area, or a retirement destination area. By controlling for factors like geography, which we cannot change, these criteria aim to identify the metropolitan areas South Bend can aspire to match. The five National Benchmark Metropolitan Areas selected based on these criteria are the following. Albany-Schenectady-Troy, NY Metropolitan Statistical Area ("Albany"), which: includes Albany County, NY, Rensselaer County, NY, Saratoga County, NY, Schenectady County, NY, Schoharie County, NY; is 88 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; had a 2008 population of 853,919 (269% of South Bend's); and is home to Rensselear Polytechnic Institute and SUNY at Albany. Ann Arbor, MI Metropolitan Statistical Area ("Ann Arbor"), which: includes Washtenaw County, MI; is 65 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; had a 2008 population of 347,376 (110% of South Bend's); and is home to the University of Michigan. Lexington-Fayette, KY Metropolitan Statistical Area ("Lexington"), which: includes Bourbon County, KY, Clark County, KY, Fayette County, KY, Jessamine County, KY, Scott County, KY, Woodford County, KY; is 33 rd in the Forbes.Com "Best Places For Business And Careers 2009" rankings; had a 2008 population of 453,424 (143% of South Bend's); and is home to the University of Kentucky. Benchmarking South Bend 4

9 Madison, WI Metropolitan Statistical Area ("Madison"), which includes Columbia County, WI, Dane County, WI, Iowa County, WI; is 55 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; had a 2008 population of 561,505 (177% of South Bend's); and is home to the University of Wisconsin. Wichita, KS Metropolitan Statistical Area ("Wichita"), which: includes Butler County, KS, Harvey County, KS, Sedgwick County, KS, Sumner County, KS; is 112 th in the Forbes.Com "Best Places For Business And Careers 2009" rankings; had a 2008 population of 603,716 (190% of South Bend's); and is home to Wichita State University. Benchmarking Comparisons In this study, we compare the following demographic and economic attributes of South Bend to those of the Indiana Benchmark Metropolitan Areas and the National Benchmark Metropolitan Areas: Forbes.Com "Best Places For Business And Careers 2009" rankings Performance Measures - population, housing, educational attainment, workforce, income, K-12 school system, research and development, entrepreneurial activity, and Innovation Index Structural Characteristics - Industry Clusters and Occupation Clusters. Benchmarking Data Tables Tables containing the detailed data used in comparing South Bend's demographic and economic attributes to those of the Indiana and National Benchmark Metropolitan Areas, and to Indiana and U.S. Averages, are in set forth in Appendix A. Conclusions We state our conclusions in the last two sections of this report: In "Part 2: Confronting The Brutal Facts", we summarize the benchmarking comparisons that signal problems South Bend must solve and identify the root cause of these problems. In "Part 3: Building Toward Improvement", we identify existing local assets and initiatives--as well as programs underway elsewhere that might be emulated locally that offer a basis for strategies by which South Bend can solve its problems. Benchmarking South Bend 5

10 PART 1: COMPARING TO THE BENCHMARKS In this section, we set forth observations from comparing South Bend's key demographic and economic attributes to those of the Indiana Benchmark Metropolitan Areas, the National Benchmark Metropolitan Areas, the Indiana Average, and the U.S. Average. The purpose of the benchmarking is to identify areas in which South Bend must improve. Hence, the benchmarks are metropolitan areas which rank higher than South Bend in the 2009 edition of the respected and widely published "Forbes Best Places for Business and Careers" 2. In a competitive global economy, these are the kind of cities South Bend must equal or surpass in order to move forward. We begin with observations from comparing the Forbes.com's "Best Places For Business And Careers 2009" rankings because they provide an overall view, which is helpful. However, it is necessary to look at more detailed factors in order to fully analyze South Bend's situation. Therefore, we also set forth observations from comparing South Bend to the Benchmark Metro's in the following Performance Measures and Structural Characteristics: Performance Measures Population Housing Education Attainment Workforce Income and Wages K-12 Schools Research and Development Entrepreneurial Activity Innovation Index Structural Characteristics Industry Clusters Occupation Clusters 2 Forbes.com: Best Places For Business And Careers 2009 ( Benchmarking South Bend 6

11 The Forbes Rankings Forbes.com's "Best Places For Business And Careers 2009" Forbes.com's "Best Places For Business And Careers 2009" rankings looked at the 200 largest metropolitan areas in the U.S., which range from the New York metro and its 11.7 million people to Olympia, Washington, with a population of 241,000. Forbes rated each metro area on the following 11 criteria and determined an overall ranking based on these criteria: Colleges Cost of Doing Business Cost of Living Crime Rate Culture and Leisure Educational Attainment Income Growth Job Growth Job Growth Projected Net Migration Subprime Mortgages Economic research firm Moody's Economy.com supplied data on job growth over the past five years and projections through Economy.com also provided business and living cost data as well as income growth and migration trends. Forbes turned to Bert T. Sperling, city researcher and coauthor of "Cities Ranked & Rated" for some labor supply and quality of life information. Sperling furnished data on college attainment, crime rates, local colleges and cultural and recreational opportunities in the area. South Bend's Forbes Rankings Compared to Indiana Benchmark Metro's Detailed comparison of the Forbes.Com rankings of South Bend and the Indiana Benchmark Metro's is presented in Appendix A, Table 1. The comparison reveals that the reasons South Bend's Overall Rank is lower than all the Indiana Benchmark Metro's are: South Bend has the worst ranking in four Category Ranks: 1) Job Growth 2) Job Growth Projected 3) Net Migration 4) Subprime Mortgages South Bend has the second-worst (only slightly better than Indianapolis) ranking in the Crime Rate Category. Benchmarking South Bend 7

12 South Bend's Forbes Rankings Compared to National Benchmark Metro's Detailed comparison of the Forbes.Com rankings of South Bend and the National Benchmark Metro's is presented in Appendix A, Table 2. The comparison reveals that the reasons South Bend's Overall Rank is lower than all the National Benchmark Metro's are: South Bend has the worst ranking in four Category Ranks: 1) Culture and Leisure 2) Educational Attainment 3) Net Migration 4) Subprime Mortgages. South Bend has the second-worst ranking in the Crime Rate Category. Benchmarking South Bend 8

13 Population South Bend's Population Indicators Compared To Indiana Benchmark Metro's Detailed data used in comparing Population indicators for South Bend, the Indiana Benchmark Metro's, and Indiana are presented in Appendix A, Table 3. Particular comparison results signaling the need for South Bend to improve are described below. Low Population Growth Rate. As set forth below and illustrated in Figure 1, South Bend's 1990 to 2008 population growth rate is lower than all the Indiana Benchmark Metro's and Indiana apparently as the result of outmigration. Indianapolis 32.5% Fort Wayne 16.0% Indiana Average 15.0% Evansville 7.8% South Bend 6.9% 35.0% Figure 1: Population Growth South Bend and Indiana Benchmark Metro's 30.0% Indiana Average 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% South Bend Evansville Fort Wayne Indianapolis Benchmarking South Bend 9

14 High Negative Net Migration Of Young, Single, Highly-Educated People. As set forth below and illustrated in Figure 2, South Bend's loss of young, single, people who have at least a Bachelor's Degree between 1995 and 2000 is worse than all the Indiana Benchmark Metro's and Indiana: Indianapolis % Fort Wayne -9.54% Evansville % Indiana Average % South Bend % Figure 2: Net Migration Rate of Young, Single & College Educated South Bend and Indiana Benchmark Metro's Indiana Average Indianapolis Fort Wayne Evansville South Bend 40.00% 30.00% 20.00% 10.00% 0.00% 10.00% 20.00% Benchmarking South Bend 10

15 Low Prime Working Age Population. As shown below, the percentage of South Bend's population that is of Prime Working Age (25 to 54) is lower than all the Indiana Benchmark Metro's and the Indiana Average. Indianapolis 44.3% Indiana Average 42.0% Fort Wayne 41.9% Evansville 41.4% South Bend 39.8% South Bend's Population Indicators Compared To National Benchmark Metro's Detailed data used in comparing Population indicators for South Bend, the National Benchmark Metro's, and the United States. are presented in Appendix A, Table 4. Particular comparison results signaling the need for South Bend to improve are described below. Low Population Growth Rate. As set forth below and illustrated in Figure 1, South Bend's 1990 to 2008 population growth rate is drastically lower than all the National Benchmark Metro's, except Albany, and the U.S. Average apparently as the result of outmigration. Lexington 30.1% Madison 29.9% Ann Arbor 22.8% U.S. Average 22.0% Wichita 18.1% South Bend 6.9% Albany 5.5% Benchmarking South Bend 11

16 Figure 3: Population Growth South Bend and National Benchmark Metro's 35.00% 30.00% U. S. Average 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% South Bend Albany Ann Arbor Lexington Madison Wichita High Negative Net Migration Of Young, Single, Highly-Educated People. As set forth below and illustrated in Figure 4, South Bend's loss of young, single, people who have at least a Bachelor's Degree between 1995 and 2000 is worse than all the National Benchmark Metro's. Ann Arbor -1.02% Wichita % Lexington % Albany % Madison % South Bend % Benchmarking South Bend 12

17 Figure 4: Net Migration Rate of Young, Single & College Educated South Bend and National Benchmark Metro's Wichita Madison Lexington Ann Arbor Albany South Bend 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% Low Prime Working Age Population. As shown below, the percentage of South Bend's population that is of Prime Working Age (25 to 54) is lower than all the National Benchmark Metro's and the U.S. Average. Madison 44.5% Lexington 44.3% Ann Arbor 42.6% U.S. Average 42.3% Albany 42.0% Wichita 41.5% South Bend 39.8% Benchmarking South Bend 13

18 Housing South Bend's Housing Indicators Compared To Indiana Benchmark Metro's Detailed data used in comparing Housing indicators for South Bend, the Indiana Benchmark Metro's, and Indiana are presented in Appendix A, Table 5. The most notable comparison result signaling the need for South Bend to improve is that South Bend's Percentage Of Housing Units Occupied is low. Conversely, the percentage of vacant housing units is high. As shown below and illustrated in Figure 5, South Bend's occupancy rate is lower than all the Indiana Benchmark Metro's and the Indiana Average. Fort Wayne 92.7% Evansville 92.3% Indianapolis 89.7% Indiana Average 88.1% South Bend 86.4% Figure 5: Percentage of Housing Units Occupied South Bend and Indiana Benchmark Metro's Benchmarking South Bend 14

19 South Bend's Housing Indicators Compared To National Benchmark Metro's Detailed data used in comparing Housing indicators for South Bend, the National Benchmark Metro's, and U.S. totals are presented in Appendix A, Table 6. As in comparing to the Indiana Benchmark Metro's, the most notable comparison result signaling the need for South Bend to improve is that South Bend's Percentage Of Housing Units Occupied is low. As shown below and illustrated in Figure 6, South Bend's occupancy rate compares more favorably to the National Benchmark Metro's than the Indiana Benchmark Metro's but, nevertheless, it is lower than three of the five National Benchmark Metro's and lower than the U.S. Average. Wichita 93.1% Lexington 90.0% Madison 88.1% U.S. Average 87.1% South Bend 86.4% Albany 85.6% Ann Arbor 84.2% Figure 6: Percentage of Housing Units Occupied South Bend and National Benchmark Metro's Benchmarking South Bend 15

20 Education Attainment Education Attainment Measures Two measures are helpful in comparing the Education Attainment levels of the population in different geographic areas: the Weighted Workforce Education Index and the Talent Index. These measures are explained below. Weighted Workforce Education Index. The Weighted Workforce Education Index is a measure devised by the Ewing Marion Kauffman Foundation as part of its annual "New Economy Index". It is computed by: weighting the percentage of residents having less than a high school education with a multiplier of -0.5, weighting the percentage of residents having a high school diploma or equivalent with a multiplier of 0.0, weighting the percentage of residents having some college (at least a year) but no degree with a multiplier of 0.25, weighting the percentage of residents having an Associate's Degree with a multiplier of 0.5, weighting the percentage of residents having a Bachelor s Degree with a multiplier of 1.0, weighting the percentage of residents having Master s and Professional Degrees with a multiplier of 1.5, weighting the percentage of residents having Doctorate Degrees with a multiplier of 2.0, and totaling the weighted percentages to produce the Weighted Workforce Education Index value. Talent Index. The Talent Index is a measure of the human capital in a geographic area based on the fraction of all people age 25 or older with a Bachelor's Degree or above who live in the area divided by the fraction of the total U.S. population age 25 or older living in that area. The resulting number is a ratio: a value over 1.0 indicates that an area has a greater-than-average share of highlyeducated residents, while a value below 1.0 indicates that an area has a lower-than-average share of highly-educated residents. South Bend's Education Attainment Indicators Compared To Indiana Benchmark Metro's Detailed comparisons of Education Attainment indicators for South Bend, the Indiana Benchmark Metro's, and Indiana are presented in Appendix A, Table 7. Particular comparison results signaling the need for South Bend to improve are described below. High "Less Than High School" Percentage. As shown below, South Bend's percentage of population age 25 and older whose education attainment level is Less Than High School is higher than all the Indiana Benchmark Metro's and the Indiana Average. Indianapolis 11.3% Fort Wayne 11.7% Evansville 13.8% Benchmarking South Bend 16

21 Indiana Average 13.8% South Bend 14.1% Low Weighted Workforce Education Index. As shown below and illustrated by Figure 7, South Bend's Weighted Workforce Education Index is higher than the Indiana Average and Evansville but lower than Fort Wayne and Indianapolis. Indianapolis Fort Wayne South Bend Indiana Average Evansville Figure 7: Weighted Workforce Education Index South Bend and Indiana Benchmark Metro's Benchmarking South Bend 17

22 Low Talent Index. As shown below, South Bend's Talent Index is higher than Evansville and about the same as Fort Wayne, but lower than Indianapolis and the Indiana Average. Indianapolis Indiana Average South Bend Fort Wayne Evansville South Bend's Education Attainment Indicators Compared To National Benchmark Metro's Detailed comparisons of Education Attainment indicators for South Bend, the National Benchmark Metro's, and U.S. are presented in Appendix A, Table 8. Particular comparison results signaling the need for South Bend to improve are described below. High "Less Than High School" Percentage. As shown below, South Bend's percentage of population age 25 and older whose education attainment level is Less Than High School is higher than all the National Benchmark Metro's but lower than the U.S. Average. Madison 6.0% Ann Arbor 6.3% Albany 9.3% Wichita 11.1% Lexington 11.6% South Bend 14.1% U.S. Average 15.0% Low Weighted Workforce Education Index. As shown below and illustrated by Figure 8, South Bend's Weighted Workforce Education Index is lower than all the National Benchmark Metro's and the U.S. Average. Ann Arbor Madison Albany Lexington Wichita U.S. Average South Bend Benchmarking South Bend 18

23 Figure 8: Weighted Workforce Education Index South Bend and National Benchmark Metro's Low Talent Index. As shown below, South Bend's Talent Index is lower than all the National Benchmark Metro's and the U.S. Average. Ann Arbor Madison Lexington Albany Wichita U.S. Average South Bend Benchmarking South Bend 19

24 Workforce South Bend's Labor Force And Employment Compared To Indiana Benchmark Metro's Detailed comparisons of 2008 Labor Force Annual Averages for South Bend, the Indiana Benchmark Metro's, and Indiana are presented in Appendix A, Table 9. Particular comparison results signaling the need for South Bend to improve are described below. Labor Force And Employment. As shown below and illustrated in Figure 9: South Bend's Labor Force has shrunken by 2.5% over the past 10 years while the Labor Force has grown in all the Indiana Benchmark Metro's and Indiana statewide. Indianapolis 12.9% Indiana Average 3.4% Fort Wayne 1.8% Evansville 0.7% South Bend -2.5% Employment over the past 10 years in Indiana statewide has remained almost unchanged, grown in Indianapolis, and shrunken in Evansville, Fort Wayne, and South Bend. South Bend's 6.4% shrinkage rate is more than five times that of Evansville and nearly four times that of Fort Wayne. Indianapolis 9.6% Indiana Average 0.2% Evansville -1.1% Fort Wayne -1.7% South Bend -6.4% Benchmarking South Bend 20

25 Figure 9: Labor Force and Employment South Bend and Indiana Benchmark Metro's Indiana Average Indianapolis Fort Wayne Evansville South Bend 10.0% 5.0% 0.0% 5.0% 10.0% 15.0% Employed 10 year % change Labor Force 10 year % change High Unemployment. As shown below, South Bend's 2008 Unemployment Rate was higher than the Unemployment Rate in all the Indiana Benchmark Metro's and Indiana. Indianapolis 5.1% Evansville 5.3% Indiana Average 5.9% Fort Wayne 6.0% South Bend 6.7% Benchmarking South Bend 21

26 South Bend's Labor Force And Employment Compared To National Benchmark Metro's Detailed comparisons of 2008 Labor Force Annual Averages for South Bend, the Indiana Benchmark Metro's, and Indiana are presented in Appendix A, Table 10. Particular comparison results signaling the need for South Bend to improve are described below. Labor Force And Employment. As shown below and illustrated in Figure 10: South Bend's Labor Force has shrunken by 2.5% over the past 10 years while the Labor Force has grown in all the National Benchmark Metro's and nationwide. U.S. Average 12.1% Madison 11.5% Lexington 8.8% Ann Arbor 8.2% Wichita 7.1% Albany 5.7% South Bend -2.5% South Bend's Employment has shrunken by 6.4% over the past 10 years while Employment in all the National Benchmark Metro's and nationwide has grown. U.S. Average 10.6% Madison 9.6% Wichita 6.0% Lexington 5.5% Albany 4.1% Ann Arbor 3.7% South Bend -6.4% Benchmarking South Bend 22

27 Figure 10: Labor Force and Employment South Bend and National Benchmark Metro's U.S. Average Wichita Madison Lexington Ann Arbor Albany South Bend 10.0% 5.0% 0.0% 5.0% 10.0% 15.0% Employed 10 year % change Labor Force 10 year % change High Unemployment. As shown below, South Bend's 2008 Unemployment Rate was higher than the Unemployment Rate in all the National Benchmark Metro's and the U.S. Madison 3.5% Wichita 4.2% Albany 5.0% Lexington 5.1% U.S. Average 5.8% Ann Arbor 5.9% South Bend 6.3% South Bend's Other Workforce Indicators Compared To Indiana Benchmark Metro's Appendix A, Table 11 presents data for South Bend, the Indiana Benchmark Metro's, and Indiana statewide for other important workforce indicators: science and engineering workforce, Bohemian Index and Creative Class Index. Particular comparison results signaling the need for South Bend to improve are described below. Benchmarking South Bend 23

28 (Note: "Bohemian" and "Creative Class" are terms coined by the prominent researcher and author Richard Florida. Florida, in several studies, has established correlations between the Bohemian and Creative Class population in a geographic area's workforce and (i) the existence in the area of an environment or milieu that attracts other types of talented or high human capital individuals and (ii) the area's clusters of innovation and high-tech industry. Florida defines Bohemians as people who are authors, designers, musicians and composers, actors and directors, craft-artists, painters, sculptors, artist printmakers, photographers, dancers, and artists, performers and related workers. He defines the Creative Class as people employed in computer and mathematical occupations; architecture and engineering; life, physical, and social science occupations; education, training, and library occupations; arts, design, entertainment, sports, and media occupations; management occupations; business and financial operations; legal occupations; healthcare practitioners and technical occupations; and high-end sales and sales management.) Low Science And Engineering Workforce. As shown below and illustrated in Figure 11, South Bend's Science And Engineering Workforce Index is lower than all the Indiana Benchmark Metro's except Evansville and lower than Indiana Average. Indianapolis Fort Wayne Indiana Average South Bend Evansville Low Bohemian Index. As shown below and illustrated in Figure 11, South Bend's Bohemian Index is lower than all the Indiana Benchmark Metro's except Evansville and lower than the Indiana Average. Indiana Average Indianapolis Fort Wayne South Bend Evansville Benchmarking South Bend 24

29 Low Creative Class Index. As shown below and illustrated in Figure 11, South Bend's Creative Class Index is higher than Evansville's and Fort Wayne's but substantially lower than Indianapolis's and the Indiana Average. Indianapolis Indiana Average South Bend Fort Wayne Evansville Figure 11: Other Workforce Indicators South Bend and Indiana Benchmark Metro's South Bend Evansville Fort Wayne Indianapolis Indiana Average Science & Engineering Workforce Index Bohemian Index Creative Class Index South Bend's Other Workforce Indicators Compared To National Benchmark Metro's Appendix A, Table 12 presents data for South Bend, the National Benchmark Metro's, and the U.S. for other important workforce indicators: science and engineering workforce, Bohemian Index and Creative Class Index. Particular comparison results signaling the need for South Bend to improve are described below. Benchmarking South Bend 25

30 Low Science And Engineering Workforce Index. As shown below and illustrated in Figure 12, South Bend's Science And Engineering Workforce Index is drastically lower than all the National Benchmark Metro's and the U.S. Ann Arbor Madison Albany Wichita Lexington U.S. Average South Bend Low Bohemian Index. As shown below and illustrated in Figure 12, South Bend's Bohemian Index is lower than all the National Benchmark Metro's and the U.S. Ann Arbor Madison U.S. Average Lexington Albany Wichita South Bend Low Creative Class Index. As shown below and illustrated in Figure 12, South Bend's Creative Class Index is lower than all the National Benchmark Metro's except Wichita, and it is lower than the U.S. Average. Ann Arbor Madison Albany Lexington U.S. Average South Bend Wichita Benchmarking South Bend 26

31 Figure 12: Other Workforce Indicators South Bend and National Benchmark Metro's South Bend Albany Ann Arbor Lexington Madison Wichita U.S. Average Science & Engineering Workforce Index Bohemian Index Creative Class Index Benchmarking South Bend 27

32 Income And Wages South Bend's Income Compared To Indiana Benchmark Metro's Appendix A, Table 13 presents Per Capita Personal Income, Median Family Income, Median Household Income, and Poverty Rate data for South Bend, the Indiana Benchmark Metro's, and Indiana. Particular comparison results signaling the need for South Bend to improve are described below. Low Median Family Income. As shown below and illustrated in Figure 13, South Bend's Median Family Income is lower than all the Indiana Benchmark Metro's and the Indiana Average. Indianapolis $67,609 Evansville $60,896 Fort Wayne $60,726 Indiana Average $59,380 South Bend $58,007 Low Median Household Income. As shown below and illustrated in Figure 13, South Bend's Median Household Income is lower than all the Indiana Benchmark Metro's and the Indiana Average. Indianapolis $54,266 Fort Wayne $49,536 Indiana Average $48,675 Evansville $46,111 South Bend $45,192 High Poverty Rate. As shown below, South Bend's Poverty Rate is higher than all the Indiana Benchmark Metro's and Indiana statewide. Fort Wayne 10.4% Indianapolis 10.9% Evansville 11.7% Indiana Average 12.3% South Bend 13.3% Benchmarking South Bend 28

33 Figure 13: Income South Bend and Indiana Benchmark Metro's $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 South Bend Evansville Fort Wayne Indianapolis Indiana Average $20,000 $10,000 $0 Median Family Income Median Household Income South Bend's Income Compared To National Benchmark Metro's Appendix A, Table 14 presents Per Capita Personal Income, Median Family and Household Income, and Poverty Rate data for South Bend, the National Benchmark Metro's, and the U.S. Particular comparison results signaling the need for South Bend to improve are described below. Low Median Family Income. As shown below and illustrated in Figure 14, South Bend's Median Family Income is substantially less than of all the National Benchmark Metro's and the U.S. Ann Arbor $83,206 Madison $78,971 Albany $74,523 Lexington $64,049 U.S. Average $63,366 Wichita $62,121 South Bend $58,007 Benchmarking South Bend 29

34 Low Median Household Income. As shown below and illustrated in Figure 14, South Bend's Median Household Income is substantially less than all the National Benchmark Metro's and the U.S. Madison $60,818 Ann Arbor $60,713 Albany $57,930 U.S. Average $52,175 Lexington $49,325 Wichita $49,092 South Bend $45,192 $90,000 Figure 14: Income South Bend and National Benchmark Metro's $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 South Bend Albany Ann Arbor Lexington Madison Wichita U.S. Average $10,000 $0 Median Family Income Median Household Income Benchmarking South Bend 30

35 High Poverty Rate. As shown below, South Bend's Poverty Rate is higher than all the National Benchmark Metro's except Lexington and the U.S. Average. Albany 10.2% Madison 10.4% Wichita 12.1% Ann Arbor 12.7% U.S. Average 13.0% South Bend 13.3% Lexington 14.7% South Bend's Wages Compared To Indiana Benchmark Metro's Appendix A, Table 15 presents South Bend's Average Wages Per Job and Median Annual Earnings in Science and Engineering occupations compared to the Indiana Benchmark Metro's and Indiana statewide. Particular comparison results signaling the need for South Bend to improve are described below. Low Average Wages Per Job. As shown below and illustrated in Figure 15, South Bend's Average Wages Per Job for all covered employment is lower than all the Indiana Benchmark Metro's except Fort Wayne and is lower than the Indiana Average. Indianapolis $43,128 Indiana Average $38,403 Evansville $38,304 South Bend $37,654 Fort Wayne $36,806 Low Average Wages In Manufacturing. The Manufacturing industry accounts for the highest percentage (14.3%) of South Bend's jobs. As shown below and illustrated in Figure 15, South Bend's Average Wages Per Job in Manufacturing is lower than all the Indiana Benchmark Metro's except Fort Wayne and is only slightly higher than the Indiana Average. Indianapolis $67,038 Evansville $55,197 South Bend $52,956 Indiana Average $52,376 Fort Wayne $49,560 Benchmarking South Bend 31

36 Figure 15: Average Wages Per Job South Bend and Indiana Benchmark Metro's $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 South Bend Evansville Fort Wayne Indianapolis Indiana Average $0 Low Median Annual Earnings In Science And Engineering Occupations. As shown below and illustrated in Figure 16, South Bend's Median Annual Earnings In Science and Engineering Occupations is drastically lower than all the Indiana Benchmark Metro's. Indianapolis $62,430 Fort Wayne $60,220 Evansville $55,610 South Bend $49,520 Benchmarking South Bend 32

37 Figure 16: Median Annual Earnings in Science & Engineering Occupations South Bend and Indiana Benchmark Metro's $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 South Bend Evansville Fort Wayne Indianapolis South Bend's Wages Compared To National Benchmark Metro's Appendix A, Table 16 presents South Bend's Average Wages Per Job and Median Annual Earnings in Science and Engineering occupations compared to the National Benchmark Metro's and the U.S. Average. Particular comparison results signaling the need for South Bend to improve are described below. Low Average Wages Per Job. As shown below and illustrated in Figure 17, South Bend's Average Wages Per Job for all covered employment is less than all the National Benchmark Metro's and is less than the U.S. Average. Ann Arbor $48,987 U.S. Average $45,563 Albany $43,912 Madison $42,623 Wichita $40,423 Lexington $40,034 South Bend $37,654 Benchmarking South Bend 33

38 Low Average Wages In Manufacturing. The Manufacturing industry accounts for the highest percentage (14.3%) of South Bend's jobs. As shown below and illustrated in Figure 17, South Bend's Average Wages Per Job in Manufacturing is lower than all the National Benchmark Metro's except Madison and is lower than the U.S. Average. Ann Arbor $70,932 Albany $61,288 Wichita $57,939 Lexington $57,435 U.S. Average $54,457 South Bend $52,956 Madison $49,859 Figure 17: Average Wages Per Job South Bend and National Benchmark Metro's $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 South Bend Albany Ann Arbor Lexington Madison Wichita U.S. Average Benchmarking South Bend 34

39 Low Median Annual Earnings In Science and Engineering Occupations. As shown below and illustrated in Figure 18, South Bend's Median Annual Earnings In Science and Engineering Occupations is drastically lower than all the National Benchmark Metro's. Ann Arbor $66,350 Wichita $65,210 Lexington $56,810 Madison $56,070 Albany $55,610 South Bend $49,520 Figure 18: Median Annual Earnings in Science & Engineering Occupations South Bend and National Benchmark Metro's $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 South Bend Albany Ann Arbor Lexington Madison Wichita Benchmarking South Bend 35

40 K-12 Schools South Bend, the Indiana Benchmark Metro's, and the National Benchmark Metro's each encompass areas served by more than one public K-12 school system. For this study, we have confined our collection and comparison of data to the largest enrollment public K-12 school system in South Bend and each Indiana Benchmark Metro and National Benchmark Metro. South Bend's K-12 Schools Compared To Benchmark Metro's Appendix A, Table 17 presents data about the public K-12 school systems in South Bend compared to the Indiana Benchmark Metro's and Indiana Average. Particular comparison results signaling the need for South Bend to improve are described below. Low School Performance: Low Proficiency Test Scores. As shown below and illustrated in Figure 19, South Bend's results on state tests of English Language Arts Proficiency and Math Proficiency are lower than all the Indiana Benchmark Metro's, except Indianapolis, and lower than the Indiana Averages. English Math Indiana Average 70.3% 72.8% Evansville 63.8% 63.0% Fort Wayne 60.2% 65.9% South Bend 57.0% 58.6% Indianapolis 48.0% 50.8% High RaMP Up Target. "RaMP Up Target" is the average yearly gain in proficiency rates that a school district must make in order to reach 100% proficiency in reading and math combined by Thus, a higher RaMP Up Target indicates lower performance in producing student proficiency. South Bend's RaMP Up Target is higher than all the Indiana Benchmark Metro's, except Indianapolis, and substantially exceeds the Indiana Average. Indiana Average 4.1% Evansville 5.2% Fort Wayne 5.3% South Bend 6.0% Indianapolis 7.2% 3 For further explanation of "RaMP Up Target", see Endnote 27 in Appendix B: Endnotes To Tables. Benchmarking South Bend 36

41 Figure 19: State Test Results English and Math Proficiency South Bend and Indiana Benchmark Metro's 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% State Test English Language Arts Proficiency State Test Math Proficiency 20.00% 10.00% 0.00% South Bend Evansville Fort WayneIndianapolis Indiana Average High Students With Special Needs Index. "Students With Special Needs Index" 4 is a measure of the concentration of students with one of three key special needs within a school district: (i) students who are economically disadvantaged, (ii) students with disabilities, and (iii) English Language Learners. The school performance measures referred to above negatively correlate with "Students With Special Needs Index"; that is, a higher Index goes together with lower performance measures. As shown below and illustrated in Figure 20, South Bend's Students With Special Needs Index is higher than all the Indiana Benchmark Metro's, except Indianapolis, and substantially higher than the Indiana Average. Indiana Average 29.4 Evansville 36.6 Fort Wayne 40.5 South Bend 47.6 Indianapolis For further explanation of the "Students With Special Needs Index", see Endnote 24 in Appendix B: Endnotes To Tables. Benchmarking South Bend 37

42 Figure 20: Students With Special Needs Index South Bend and Indiana Benchmark Metro's 60 Indiana Average South Bend Evansville Fort Wayne Indianapolis South Bend's K-12 Schools Compared To National Benchmark Metro's Appendix A, Table 18 presents data about the public K-12 school system in South Bend compared to the National Benchmark Metro's. Particular comparison results signaling the need for South Bend to improve are described below. Low School Performance: Low Proficiency Test Scores. As shown below and illustrated in Figure 21, South Bend's results on state tests of English Language Arts Proficiency and Math Proficiency are lower than all the National Benchmark Metro's except Albany. English Math Ann Arbor 86.4% 87.1% Madison 76.3% 70.8% Lexington 72.1% 68.1% Wichita 68.3% 65.5% South Bend 57.0% 58.6% Albany 50.1% 58.3% Benchmarking South Bend 38

43 Figure 21: State Test Results English and Math Proficiency South Bend and National Benchmark Metro's % 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% State Test English Language Arts Proficiency State Test Math Proficiency 20.00% 10.00% 0.00% South Bend Albany Ann Arbor Lexington Madison Wichita High RaMP Up Target. "RaMP Up Target" is the average yearly gain in proficiency rates that a school district must make in order to reach 100% proficiency in reading and math combined by Thus, a higher RaMP Up Target indicates lower performance in producing student proficiency. South Bend's RaMP Up Target is higher than all the National Benchmark Metro's except Albany. Ann Arbor 2.2% Madison 4.4% Lexington 5.0% Wichita 5.0% South Bend 6.0% Albany 7.1%% 5 For further explanation of "RaMP Up Target", see Endnote 27 in Appendix B: Endnotes To Tables. Benchmarking South Bend 39

44 High Students With Special Needs Index. "Students With Special Needs Index" 6 is a measure of the concentration of students with one of three key special needs within a school district: (i) students who are economically disadvantaged, (ii) students with disabilities, and (iii) English Language Learners. The school performance measures referred to above negatively correlate with "Students With Special Needs Index"; that is, a higher Index goes together with lower performance measures. As shown below and illustrated in Figure 22, South Bend's Students With Special Needs Index is higher than all the National Benchmark Metro's. Ann Arbor 17.5 Lexington 29.3 Madison 35.8 Wichita 46.4 Albany 47.0 South Bend 47.6 Figure 22: Students With Special Needs Index South Bend and National Benchmark Metro's South Bend Albany Ann Arbor Lexington Madison Wichita 6 For further explanation of the "Students With Special Needs Index", see Endnote 24 in Appendix B: Endnotes To Tables. Benchmarking South Bend 40

45 Research And Development South Bend's Research And Development Indicators Compared To Indiana Benchmark Metro's Appendix A, Table 19 presents data about research and development indicators for South Bend compared to the Indiana Benchmark Metro's. The University Technology Transfer Indicators is not useful for Indiana Benchmark comparisons because Evansville and Fort Wayne do not have research universities and data are not available for IUPUI in Indianapolis. Particular comparison results signaling the need for South Bend to improve are described below. Low Patents Per 10,000 Employees. As shown below and illustrated in Figure 23, South Bend's Patents Per 10,000 Employees, although higher than Evansville's and the Indiana Average, is substantially lower than Fort Wayne and Indianapolis. Fort Wayne 6.05 Indianapolis 5.28 South Bend 4.82 Indiana Average 4.21 Evansville 2.84 Low Patenting Growth. As shown below, South Bend's patenting activity has been declining as indicated by a negative rate of Patenting Growth from 1998 to It is also lower than Evansville's and Fort Wayne's, and lower than the Indiana Average. Fort Wayne 0.28% Evansville -0.45% Indiana Average -2.13% South Bend -2.62% Indianapolis -3.15% Benchmarking South Bend 41

46 Figure 23: Patents Per 10,000 employees South Bend and Indiana Benchmark Metro's Low Traded Industry Establishments Growth. Traded Industries are industries that sell products and services across economic areas. Traded Industries are concentrated in the specific regions where they choose to locate production because of the competitive advantages afforded by these locations. As shown below, South Bend's Traded Industry Establishments Growth from 1998 to 2007 is substantially lower than all the Indiana Benchmark Metro's and the Indiana Average. Indianapolis 2.82% Indiana Average 1.69% Fort Wayne 1.60% Evansville 0.98% South Bend 0.24% Benchmarking South Bend 42

47 South Bend's Research And Development Indicators Compared To National Benchmark Metro's Appendix A, Table 20 presents data about research and development indicators for South Bend compared to the National Benchmark Metro's. Particular comparison results signaling the need for South Bend to improve are described below. Low University Technology Transfer. All but one of the University Technology Transfer Indicators for South Bend's research university, University of Notre Dame, are lower than those for the research universities of the National Benchmark Metro's. The one exception is that Notre Dame's research expenditures exceed those of Rensselear Polytechnic Institute. Low Patents Per 10,000 Employees. As shown below and illustrated in Figure 24, South Bend's Patents Per 10,000 Employees, at 4.82 in 2007 is substantially lower than all the National Benchmark Metro's except Wichita and is lower than the U.S. Average. Ann Arbor Albany Lexington 8.38 Madison 8.23 U.S. Average 6.38 South Bend 4.82 Wichita 2.72 Low Patenting Growth. As shown below, South Bend's Patenting Growth from 1998 to 2007 was lower than all the National Benchmark Metro's and lower than the U.S. Average. Lexington 5.00% Albany 1.51% Ann Arbor 0.64% U.S. Average -0.30% Madison -1.28% Wichita -1.98% South Bend -2.62% Benchmarking South Bend 43

48 Figure 24: Patents Per 10,000 Employees South Bend and National Benchmark Metro's Low Traded Industry Establishments Growth. As shown below, South Bend's Traded Industry Establishments Growth from 1998 to 2007 is drastically lower than all the National Benchmark Metro's and the U.S. Average. Albany 2.97% Madison 2.51% Lexington 2.45% U.S. Average 2.11% Wichita 1.39% Ann Arbor 0.97% South Bend 0.24% Benchmarking South Bend 44

49 Entrepreneurial Activity South Bend's Entrepreneurial Activity Compared To Indiana Benchmark Metro's And National Benchmark Metro's Appendix A, Table 21 presents entrepreneurial activity indicators data for South Bend compared to the Indiana Benchmark Metro's, and Table 22 presents entrepreneurial activity data for South Bend compared to the National Benchmark Metro's. Observations regarding South Bend's need for improvements signaled by the data shown in Tables 21 and 22 are identical and, therefore, are combined in the comments set forth below. Low Entrepreneurial Activity. South Bend's performance in all the following measures is the lowest, or next to lowest, in comparison to all the Indiana Benchmark Metro's and National Benchmark Metro's: Annual rate of business startups Annual rate of business closings Business Churn Rate 7 Entrepreneurial Value Added 8 Low Entrepreneur.com "2006 Hot Cities For Entrepreneurs" Rankings. South Bend's rankings in the Entrepreneur.com "2006 Hot Cities For Entrepreneurs" are the lowest in comparison to all the Indiana Benchmark Metro's and all the National Benchmark Metro's in all the categories, which include: Overall Entrepreneurial Activity Rank Young Company Rank Rapid Growth Rank 7 "Business Churn Rate" is the average amount of money placed into circulation, through their business activity, by individual entrepreneurs (i.e., companies that have no employees other than the individual). Computed as total receipts/total number of establishments. "Value Added" means that the money continues to circulate locally instead of being siphoned to activities outside the MSA. A large Entrepreneurial Value Added suggests that other entrepreneurs will take advantage of startup funds and, in turn, increase the amount of capital in circulation. 8 "Entrepreneurial Value Added" is the average amount of money placed into circulation, through their business activity, by individual entrepreneurs. "Value Added" means that the money continues to circulate locally instead of being siphoned to activities outside the MSA. A large Entrepreneurial Value Added suggests that other entrepreneurs will take advantage of startup funds and, in turn, increase the amount of capital in circulation. Benchmarking South Bend 45

50 Innovation Index The Innovation Index is the product of a research partnership between the Purdue Center for Regional Development, the Indiana Business Research Center at Indiana University's Kelley School of Business, Strategic Development Group, Inc., the Rural Policy Research Institute, and Economic Modeling Specialists, Inc. The Innovation Index compares regional performance to the United States and is calculated from four sub-indices. The weights for the four components are listed below. (An additional "State Context" sub-index is displayed as part of the data output, but it is for reference only and not included in the calculation of the Overall Index.) Human Capital: 30% Economic Dynamics: 30% Productivity and Employment: 30% Economic Well-Being: 10% Further explanation of the Innovation Index methodology and the data tool are accessible at In addition, Innovation Index Definitions, Calculations, and Models are set forth in detail beginning on page 195 of the report "Crossing the Next Regional Frontier: Information and Analytics Linking Regional Competitiveness to Investment in a Knowledge-Based Economy", which can be viewed at-- South Bend's Innovation Index Compared To Indiana Benchmark Metro's The Innovation Index summarizes and corroborates the data and observations comparing South Bend to the Indiana Benchmark Metro's and Indiana Average presented so far in this report. As shown in Appendix A, Table 23 and illustrated in Figure 25, comparison results signaling the need for South Bend to improve are: Low Overall Innovation Index. South Bend's Overall Innovation Index is lower than all the Indiana Benchmark Metro's and lower than the Indiana Average. Also illustrated in Figure 25, is the fact that this is attributable to South Bend's Human Capital Index being next to lowest among the Indiana metro's, and both its Economic Dynamics Index, and Productivity and Employment Index being lower than all the Indiana Benchmark Metro's and the Indiana Average. Low Human Capital Index. South Bend's Human Capital Index is slightly higher than Evansville's and the Indiana Average but lower than Fort Wayne and Indianapolis. Factors used in determining the Human Capital Index are detailed in Table 23. Low Economic Dynamics Index. South Bend's Economic Dynamics Index is the lowest among Indiana metro's and substantially lower than the Indiana Average. Factors used in determining the Economic Dynamics Index are detailed in Table 23. Low Productivity And Employment Index. South Bend's Productivity And Employment Index is the lowest among Indiana metro's and lower than the Indiana Average. Factors used in determining the Productivity And Employment Index are detailed in Table 23. Benchmarking South Bend 46

51 Figure 25: Innovation Index and Components South Bend and Indiana Benchmark Metro's South Bend Evansville Fort Wayne Indianapolis Indiana Average Overall Human Capital Economic Dynamics Productivity & Employment Economic Well Being South Bend's Innovation Index Compared To National Benchmark Metro's The Innovation Index summarizes and corroborates the data and observations comparing South Bend to the National Benchmark Metro's presented so far in this report. As shown in Appendix A, Table 24 and illustrated in Figure 26, comparison results signaling the need for South Bend to improve are: Low Overall Innovation Index. South Bend's Overall Innovation Index is lower than all the National Benchmark Metro's and is very substantially lower than Ann Arbor, Albany and Madison. Low Human Capital Index. South Bend's Human Capital Index is lower than all the National Benchmark Metro's. Factors used in determining the Human Capital Index are detailed in Table 24. Low Economic Dynamics Index. South Bend's Economic Dynamics Index is lower than all the National Benchmark Metro's, except Albany. Factors used in determining the Economic Dynamics Index are detailed in Table 24. Benchmarking South Bend 47

52 Low Productivity And Employment Index. South Bend's 87.5 Productivity And Employment Index is lower than all the National Benchmark Metro's except Wichita. Factors used in determining the Productivity And Employment Index are detailed in Table 24. Figure 26: Innovation Index and Components South Bend and National Benchmark Metro's South Bend Albany Ann Arbor Lexington Madison Wichita U.S. Average Overall Human Capital Economic Dynamics Productivity & Employment Economic Well Being Benchmarking South Bend 48

53 Industry Clusters Industry Cluster Analysis is one way of looking at the Structural Characteristics the economic makeup--of regions that drive Performance Measures such as those we have discussed so far in this report. An Industry Cluster is a geographically bounded concentration of similar, related or complementary businesses that share infrastructure, labor markets, and services; and that face common opportunities and threats. Concentration is the key identifier of a cluster, and it is typically measured by relative employment intensity. Two common methods for measuring and evaluating clusters are Location Quotient (LQ) Analysis, and Shift-Share Analysis. These methods and their application to South Bend and the benchmark metropolitan areas are described below. Location Quotient Analysis One way to measure job concentration in a region, and thus determine whether an Industry Cluster exists, is the location quotient (LQ). The LQ is the ratio of the share of total regional employment represented by a particular industry to the share of total national employment represented by the same industry. An LQ significantly greater than 1.00 suggests a cluster, because an area with an LQ higher than 1.00 in a particular industry has greater employment in that industry than the nation has on average. Using the calculation of an industry employment LQ for a metropolitan area as an example, the calculation of the LQ would be: LQ = (E 1 / E 2 ) / (N 1 / N 2 ) Where: E 1 = Metropolitan Area Employment in Industry X E 2 = Total Metropolitan Area Employment N 1 = National Employment in Industry X N 2 = Total National Employment Location Quotients are especially useful in showing where industry sectors in a locality are more strongly represented than they are in the nation as a whole. To the extent that a locality's Location Quotient for an industry is greater than 1.00 (an LQ of 1.00 indicates that the locality and the nation have the same proportion of an industry), the locality is considered to be more specialized in that industry or cluster than the nation is. More specifically: If LQ < 1.00, the locality is less specialized in industry X, and must import goods to satisfy local demand; If LQ = 1.00, the locality produces just enough in industry X to satisfy local demand; and If LQ > 1.00, the locality is more specialized in industry X and exports the industry s output to other regions. South Bend's Industry Employment LQs Compared To Indiana Benchmark Metro's Appendix A, Table 25 presents South Bend's Industry Employment LQs compared to the Indiana Benchmark Metro's and Indiana statewide; and Table 26 presents the percentage growth in Benchmarking South Bend 49

54 Industry Cluster employment from 2001 to Observations from the content of Tables 25 and 26 are set forth below. South Bend's LQ Is Greater Than 1.00 In Nine Industries. South Bend's Industry Employment LQ in the following industries is greater than 1.00: Transportation Equipment Manufacturing 3.14 Primary Metal Manufacturing 2.92 Fabricated Metal Product Manufacturing 2.04 Manufacturing Supercluster 1.79 Chemicals & Chemical Based Products 1.49 Education & Knowledge Creation 1.38 Elect. Equip., Appliance & Component Manufacturing 1.18 Machinery Manufacturing 1.04 Forest & Wood Products 1.03 South Bend's LQ Is The Highest In Indiana In Four Industries. South Bend's Industry Employment LQ in the following industries is higher than all the Indiana Benchmark Metro's and Indiana statewide: Transportation Equipment Manufacturing--South Bend's 3.14 LQ is slightly greater than Evansville's 3.05 LQ, substantially exceeds Fort Wayne and Indianapolis, and drastically exceeds Indiana's Fabricated Metal Product Manufacturing--South Bend's 2.04 LQ substantially exceeds that of any Indiana Benchmark Metro and Indiana's Education and Knowledge Creation--South Bend's 1.38 LQ is at least five times that of any Indiana Benchmark Metro and substantially exceeds Indiana's Forest & Wood Products--South Bend's 1.03 LQ substantially exceeds that of any Indiana Benchmark Metro and Indiana's South Bend's Highest LQ Industries Are Declining Industries. As shown in Appendix A, Table 26 and highlighted by Figure 27, from 2001 to 2008 (a period during which Indiana statewide employment grew 0.04% and U.S. nationwide employment grew 3.99%), employment in all the industries in which South Bend's Industry Employment LQ is greater than 1.00, except Education and Knowledge Creation, declined substantially in South Bend, in Indiana, and nationwide. Benchmarking South Bend 50

55 Figure 27: Declining Employment In South Bend's Highest LQ Industries South Bend's Employment Change Industry Cluster 2008 LQ Indiana U.S. Transportation Equipment Mfg % 16.17% Primary Metal Mfg % 22.12% Fabricated Metal Product Mfg % 8.39% Manufacturing Supercluster % 17.75% Chemicals & Chemical Based Products % 14.14% Education & Knowledge Creation % 10.08% Electrical Equip., Appliance & Component Mfg % 23.56% Machinery Mfg % 13.27% Forest & Wood Products % 14.79% South Bend's LQ Is Low In All But One Of Indiana's Growth Industries. As shown by Appendix A, Table 26 and highlighted in Figure 28, there are five industries in which both Indiana and the U.S. experienced employment growth from 2001 to South Bend's Industry Employment LQ in all those industries, except Education and Knowledge Creation, is lower than all the Indiana Benchmark Metro's. Biomedical/Biotechnical (Life Sciences)--Indiana's highest employment growth industry at 20.24%; South Bend's 0.71 LQ is the lowest of all Indiana Benchmark Metro's, lower than Indiana's statewide 0.94, and less than half that of Indianapolis. Education and Knowledge Creation--Indiana's second highest employment growth industry at 11.14%; South Bend's 1.38 LQ is at least five times that of any Indiana Benchmark Metro and substantially exceeds Indiana's Defense and Security--Indiana's third highest employment growth industry at 5.62%; South Bend's 0.55 LQ is greater than Evansville and Fort Wayne, but it is lower than that of Indianapolis and less than half of Indiana's statewide Business and Financial Services--Indiana's fourth highest employment growth industry at 2.80%; South Bend's 0.58 LQ is lower than all the Indiana Benchmark Metro's except Evansville and lower than Indiana's Transportation and Logistics--Indiana's fifth employment growth industry at 2.64%; South Bend's 0.81 LQ is about the same as Indiana's 0.80, but it is substantially lower than all the Indiana Benchmark Metro's. Benchmarking South Bend 51

56 Figure 28: South Bend's Low LQ In Indiana's Growth Industries Employment Change Industry Cluster Indiana U.S. South Bend's 2008 LQ Biomedical/Biotechnical (Life Sciences) 20.24% 19.31% 0.71 Education & Knowledge Creation 11.14% 10.08% 1.38 Defense and Security 5.62% 1.26% 0.55 Business and Financial Services 2.80% 6.51% 0.58 Transportation and Logistics 2.64% 1.88% 0.81 South Bend's Industry Cluster Employment LQs Compared To National Benchmark Metro's Appendix A, Table 27 presents South Bend's Industry Cluster Employment LQs compared to the National Benchmark Metro's. Table 28 presents the percentage growth in Industry Cluster employment from 2001 to Observations regarding the content of Tables 27 and 28 are set forth below. South Bend's LQ Is The Highest In Five Industries. South Bend's Industry Cluster Employment LQ in the following industries is larger than all the National Benchmark Metro's: Chemicals & Chemical Based Products--South Bend's 1.49 LQ substantially exceeds Madison's and is more than double all the other National Benchmark Metro's. Education and Knowledge Creation--South Bend's 1.38 LQ is nearly double that of Wichita and ranges from two to eight times all the other National Benchmark Metro's. Forest & Wood Products--South Bend's 1.03 LQ substantially exceeds all the National Benchmark Metro's. Fabricated Metal Product Manufacturing--South Bend's 2.04 LQ substantially exceeds all the National Benchmark Metro's. Primary Metal Manufacturing--South Bend's 2.92 LQ substantially exceeds all the National Benchmark Metro's and is seven times that of the next highest. South Bend's LQ Is Low In All But One Of The National Growth Industries. As shown in Table 28 and highlighted in Figure 29, there are eight industries in which the U.S. experienced employment growth from 2001 to South Bend's Industry Employment LQ in all those industries except Education and Knowledge Creation is low compared to nearly all the National Benchmark Metro's. Benchmarking South Bend 52

57 Figure 29: South Bend's Low LQ In National Growth Industries Industry Cluster U.S. Employment Change South Bend's 2008 LQ Biomedical/Biotechnical (Life Sciences) 19.31% 0.71 Education & Knowledge Creation 10.08% 1.38 Mining 7.37% 0.00 Business and Financial Service 6.51% 0.58 Energy (Fossil & Renewable) 4.30% 0.57 Arts, Entertainment, Recreation & Visitor Industries 4.13% 0.49 Transportation and Logistics 1.88% 0.81 Defense and Security 1.26% 0.55 Biomedical/Biotechnical (Life Sciences)--The nation's highest employment growth industry at 19.31%; South Bend's 0.71 LQ is lower than all the National Benchmark Metro's except Wichita. Education and Knowledge Creation--The nation's second highest employment growth industry at 10.08%; South Bend's 1.38 LQ is nearly double that of Wichita and ranges from two to eight times all the other National Benchmark Metro's. Mining--The nation's third highest employment growth industry at 7.37%; South Bend's 0.00 LQ is lower than Albany and Madison and the about the same as the other National Benchmark Metro's. Business and Financial Services--The nation's fourth highest employment growth industry at 6.51%; South Bend's 0.58 LQ is lower than all the National Benchmark Metro's except Wichita. Energy (Fossil & Renewable)--The nation's fifth highest employment growth industry at 4.30%; South Bend's 0.57 LQ is lower than all the National Benchmark Metro's. Arts, Entertainment, Recreation & Visitor Industries--The nation's sixth highest employment growth industry at 4.13%; South Bend's 0.49 LQ is lower than all the National Benchmark Metro's except Albany. Benchmarking South Bend 53

58 Transportation and Logistics--The nation's seventh highest employment growth industry at 1.88%; South Bend's 0.81 LQ is higher than all the National Benchmark Metro's, except Lexington. Defense and Security--The nation's eighth highest growth industry at 1.26%; South Bend's 0.55 LQ is lower than all the National Benchmark Metro's except Ann Arbor. Wichita's LQ, at 3.18 was drastically higher than all the National Benchmark Metro's. Shift-Share Analysis Industry Location Quotients are useful in giving an initial picture of the Structural Characteristics in a regional economy, but they do not explain the sources of change, give a full picture of how the composition of regional employment differs from national patterns, or explain how the performance of the regional economy differs from that of the nation. Shift-share analysis can help provide this missing information. Shift-share analysis seeks to explain changes in an economy by decomposing actual changes that have occurred into three main sources: 9 The influence of national growth (or decline) on industry X. This is called the "National Share" of change. For example, between 2001 and 2008, total employment in the United States grew by 3.99%. Applying this 3.99% National Share factor to industry employment in the base year (2001) estimates how regional employment would be expected to change if the national influence had equally affected every industry. The influence of industry growth (or decline) on industry X. "Industry Share" reflects the rate of change in each individual industry at the national level for example, how much employment changed in all manufacturing industries throughout the nation from 2001 to The Industry Share measures how much of the regional change in employment can be attributed to national growth or decline in the industry in question. As with National Share, the percentage change in employment by the industry nationally is applied to the base year regional employment in the industry to estimate how regional employment would be expected to change if the industry influence had equally affected every region. The "Regional Share" effect on growth (or decline) of industry or cluster X. The National Share and the Industry Share reveal the changes that would have occurred in the regional economy if it corresponded exactly to national and industrial structure and trends. When these two computed shares are subtracted from the actual shift in employment locally, a residual change remains. This is the change in employment that cannot be explained by either general economic conditions (the National Share) or industrial trends (the Industry Share). This change, the "Regional Share," reveals the effects of region-specific factors on regional employment. The Regional Share tells us that an industry enjoys advantages (or suffers disadvantages in the case of a negative value) resulting from regional factors such as labor force skills, access to transportation, supply chain quality, service delivery effectiveness and efficiency, and so on. To summarize, Regional Share--the shift share due to regional trends and conditions--is computed as shown below. 9 This section on shift-share analysis is largely adapted from the excellent explanation given in Greater Cincinnati s Target Industries, Center for Economic Education, University of Cincinnati, September Benchmarking South Bend 54

59 Computing Shift Share Analysis Actual Shift in Employment in Industry X Shift due to national change Shift due to industrial trend in industry X = Shift due to regional trends and conditions Source: Center for Economic Education, University of Cincinnati, South Bend's Shift Share From 2001 To 2008 Appendix A, Table 29 presents South Bend's Shift Share Analysis from 2001 to The key observation from the content of Table 29 that signals a need for South Bend to improve is South Bend's Shift Share in 15 of the 23 Industry Clusters measured was negative. That is, in more than 75% of its Industry Clusters South Bend's growth in employment was less (or its shrinkage in employment was more) than that attributable to national change and industry trend. This implies that, for those industries, South Bend presents disadvantages resulting from factors such as labor force skills, access to transportation, supply chain quality, and service delivery effectiveness and efficiency. In light of observations earlier in this report that South Bend's Prime Working Age Population, Weighted Workforce Education Index, and Talent Index are all less than the U.S. Average, it is reasonable to surmise that labor force deficiencies are the disadvantage which causes the region's shift share to be negative. Benchmarking South Bend 55

60 Occupation Clusters Occupation Cluster Analysis Occupation Cluster analysis is a relatively new approach in regional economic development. Occupation Clusters are, like Industry Clusters, a way of looking at the Structural Characteristics-- the economic makeup--of regions that drive Performance Measures such as those we have discussed so far in this report. However, in contrast to Industry Clusters that focus on what businesses produce, occupation clusters focus on the knowledge, skills and abilities of the people who work for those businesses. Occupation cluster analysis offers insights into the talent base of the regional workforce that go beyond the relatively simple measures of educational attainment presented earlier in this report. The Occupational Information Network (O*Net) 10 divides occupations into five job zones, based on the education and experience a person needs to do the work. As part of a recent study conducted for the U.S. Economic Development Administration, the Purdue Center for Regional Development 11 used a clustering algorithm with some subsequent fine-tuning to construct 15 knowledge-based occupation clusters containing all occupations within the three highest O*Net job zones. One of these clusters, health care and medical science, was subsequently disaggregated into three morespecialized sub-clusters. Figure 30 shows a list of the clusters and subclusters. In Appendix A, Tables 30 through 33 include data pertaining to those clusters and subclusters plus the following: Job Zones 1 and 2 - Occupations that call for a high school diploma or less and little training or experience, such as taxi drivers or customer service representatives. Technology-Based Clusters - The Purdue Center for Regional Development has defined a group of occupation clusters as "Technology-Based Knowledge Clusters" which include the following: Information Technology Engineering Health Care and Medical Science (Medical Practitioners and Scientists) Mathematics, Statistics, Data and Accounting Natural Sciences and Environmental Management Postsecondary Education and Knowledge Creation South Bend's Occupation Cluster Employment Compared To Indiana Benchmark Metro's In Appendix A, Tables 30 and 31 present data about South Bend's Occupation Cluster Employment compared to the Indiana Benchmark Metro's and Indiana statewide. For each Occupation Cluster, 10 O*Net is developed under the sponsorship of the U.S. Department of Labor/Employment and Training Administration ( 11 Purdue Center For Regional Development ( Benchmarking South Bend 56

61 Table 30 presents the Occupation Cluster Location Quotients 12 in 2007 and Table 31 presents the percentage growth in number of employees from 2001 to Observations from the content of Tables 30 and 31 that signal the need for South Bend to improve are set forth below. Figure 30: Occupation Clusters Defined In The Purdue Study Occupation Cluster Name Arts, Entertainment, Publishing & Broadcasting Building, Landscape & Construction Design Crop & Livestock Workers Engineering & Related Sciences Health Care & Medical Science (Aggregate) Health Care & Medical Science (Medical Practitioners and Scientists) Health Care & Medical Science (Medical Technicians) Health Care & Medical Science (Therapy, Counseling & Rehabilitation) Information Technology Legal & Financial Services & Real Estate Managerial, Sales, Marketing & HR Mathematics, Statistics, Data & Accounting Natural Sciences & Environmental Management Personal Services Occupations Postsecondary Education & Knowledge Creation Primary/Secondary & Vocational Education, Remediation & Social Services Public Safety & Domestic Security Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers Lowest LQ In Indiana In Five Skilled Occupations. South Bend has the lowest LQ in the following Occupation Clusters compared to the Indiana Benchmark Metro's, indicating a lower concentration of such workers in South Bend. Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers- South Bend's 1.09 LQ is lower than that of any Indiana Benchmark Metros and Indiana's statewide Health Care & Medical Science (Therapy, Counseling & Rehabilitation subcluster) - South Bend's 1.09 LQ is lower than all the Indiana Benchmark Metro's but higher than Indiana's statewide Natural Sciences & Environmental Management - South Bend's 0.48 LQ is lower than all the Indiana Benchmark Metro's and Indiana's statewide The Location Quotient concept is explained in the Industry Clusters section above. Benchmarking South Bend 57

62 Building, Landscape & Construction Design - South Bend's 0.70 LQ is lower than all the Indiana Benchmark Metro's and Indiana's statewide Engineering & Related Sciences - South Bend's 0.65 LQ is lower than all the Indiana Benchmark Metro's and Indiana's statewide Low Employment Growth In Highest LQ Occupations. As shown in Table 31 and highlighted by Figure 31, for all but one of the Occupations in which South Bend's LQ is greater than 1.00, South Bend's percentage growth in number of employees from 2001 to 2007 was lower than that in all the Indiana Benchmark Metro's, lower than the Indiana Average, lower than the U.S. Average, or all three. The only exception to this was Postsecondary Education & Knowledge Creation (LQ of 1.88), in which South Bend's 2001 to 2007 employment growth rate of 28.85% substantially exceeded the growth rates of all the Indiana Benchmark Metro's, the 13.52% Indiana Average, and the 15.65% U.S. Average. Figure 31: South Bend's Low Growth In Its High LQ Occupation Clusters Occupation Cluster Employment Change South Bend's 2007 LQ South Bend Indiana U.S. Postsecondary Education & Knowledge Creation % 13.52% 15.65% Health Care & Medical Science (Medical Technicians) % 13.86% 14.84% Health Care & Medical Science (Aggregate) % 12.48% 13.29% Primary/Secondary & Vocational Education, Remediation & Social Services % 7.67% 10.08% Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers % 2.40% 7.87% Health Care & Medical Science (Therapy, Counseling & Rehabilitation) % 13.48% 13.79% Job Zone % 1.70% 6.18% Job Zone % 3.08% 6.55% LQ Is Less Than 1.00 In Five Of Indiana's Top 10 Growth Occupations. As shown by Tables 30 and 31 and highlighted in Figure 32, South Bend's Occupation Cluster LQ in five of Indiana's top 10 employment growth occupations is lower than all the Indiana Benchmark Metro's. Benchmarking South Bend 58

63 Figure 32: South Bend's Low LQ In Indiana's High Growth Occupation Clusters Employment Change Occupation Cluster Indiana U.S. South Bend's 2007 LQ Health Care & Medical Science (Medical Technicians) 13.86% 14.84% 1.34 Postsecondary Education & Knowledge Creation 13.52% 15.65% 1.88 Health Care & Medical Science (Therapy, Counseling & Rehabilitation) 13.48% 13.79% 1.09 Health Care & Medical Science (Aggregate) 12.48% 13.29% 1.11 Arts, Entertainment, Publishing & Broadcasting 9.07% 10.00% 0.85 Health Care & Medical Science (Medical Practitioners and Scientists) 8.29% 10.77% 0.95 Legal & Financial Services & Real Estate 8.01% 12.75% 0.88 Primary/Secondary & Vocational Education, Remediation & Social Services 7.67% 10.08% 1.10 Public Safety & Domestic Security 7.65% 9.38% 0.84 Managerial, Sales, Marketing & HR 6.58% 9.57% 0.91 South Bend's Occupation Cluster Employment Compared To National Benchmark Metro's In Appendix A, Tables 32 and 33 present data about South Bend's Occupation Cluster Employment compared to the National Benchmark Metro's and the U.S. For each Occupation Cluster, Table 32 presents the Occupation Cluster Location Quotients in 2007 and Table 33 presents the percentage growth in number of employees from 2001 to Observations from the content of Tables 32 and 33 that signal the need for South Bend to improve are set forth below. LQ Is The Lowest In Six Skilled Occupations. South Bend has the lowest LQ in the following Occupation Clusters compared to the National Benchmark Metro's, indicating a lower concentration of such workers in South Bend. Mathematics, Statistics, Data & Accounting - South Bend's 0.82 is the lowest, three of the Benchmark Metro's have an LQ above 1.00, and Albany's 1.38 is the highest. Benchmarking South Bend 59

64 Information Technology - South Bend's 0.81 is the lowest, three of the Benchmark Metro's have an LQ above 1.00, and Madison's 1.53 is the highest. Natural Sciences & Environmental Management - South Bend's 0.48 LQ is the lowest, all the Benchmark Metro's have an LQ above 1.00, and Madison's 2.29 is the highest. Building, Landscape & Construction Design - South Bend's 0.70 LQ is the lowest, all the Benchmark Metro's have an LQ above 1.00, and Madison's 1.47 is the highest. Engineering & Related Sciences - South Bend's 0.65 LQ is the lowest, all the Benchmark Metro's have an LQ above 1.00, and Wichita's 2.00 is the highest. Technology-Based Knowledge Clusters - South Bend's 0.95 LQ is the lowest, all the Benchmark Metro's except Lexington have an LQ above 1.00, and Madison's 1.42 is the highest. Low Employment Growth In Highest LQ Occupations. As shown in Table 33 and highlighted by Figure 33, for all but one of the Occupations in which South Bend's LQ is greater than 1.00, South Bend's percentage growth in number of employees from 2001 to 2007 was lower than that in all the National Benchmark Metro's and lower than the U.S. Average. The only exception to this was Postsecondary Education & Knowledge Creation (LQ of 1.88), in which South Bend's 2001 to 2007 employment growth rate of 28.85% substantially exceeded the growth rates of all the Indiana Benchmark Metro's, the 13.52% Indiana Average, and the 15.65% U.S. Average. Figure 33: South Bend's Low Growth In Its High LQ Occupation Clusters Occupation Cluster Employment Change South Bend's 2007 LQ South Bend U.S. Postsecondary Education & Knowledge Creation % 15.65% Health Care & Medical Science (Medical Technicians) % 14.84% Health Care & Medical Science (Aggregate) % 13.29% Primary/Secondary & Vocational Education, Remediation & Social Services % 10.08% Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers % 7.87% Health Care & Medical Science (Therapy, Counseling & Rehabilitation) % 13.79% Job Zone % 6.18% Job Zone % 6.55% LQ Is Less Than 1.00 In Five Of The Nation's Top 10 Growth Occupations. As shown by Tables 32 and 33 and highlighted in Figure 34, South Bend's Occupation Cluster LQ in five of the nation's top 10 employment growth occupations is lower than 1.00, indicating a low concentration of such workers in South Bend compared to the United States overall. Benchmarking South Bend 60

65 Figure 34: South Bend's Low LQ In Nation's High Growth Occupation Clusters Employment Change Occupation Cluster U.S. South Bend's 2007 LQ Postsecondary Education & Knowledge Creation 15.65% 1.88 Health Care & Medical Science (Medical Technicians) 14.84% 1.34 Personal Services Occupations 14.30%.89 Health Care & Medical Science (Therapy, Counseling & Rehabilitation) 13.79% 1.09 Health Care & Medical Science (Aggregate) 13.29% 1.11 Legal & Financial Services & Real Estate 12.75% 0.88 Health Care & Medical Science (Medical Practitioners and Scientists) 10.77% 0.95 Primary/Secondary & Vocational Education, Remediation & Social Services 10.08% 1.10 Arts, Entertainment, Publishing & Broadcasting 10.00% 0.84 Managerial, Sales, Marketing & HR 9.57% 0.91 Benchmarking South Bend 61

66 PART 2: CONFRONTING THE BRUTAL FACTS In his book Good To Great, Jim Collins notes "All good-to-great companies began the process of finding a path to greatness by confronting the brutal facts of their current reality. When you start with an honest and diligent effort to determine the truth of the situation, the right decisions often become self-evident. Not always, of course, but often. You absolutely cannot make a series of good decisions without first confronting the brutal facts." 13 The Brutal Facts The "brutal facts" of South Bend's current reality are its unfavorable comparisons to the Indiana Benchmark Metro's and the National Benchmark Metro's in 40 Performance Measures and Structural Characteristics. These unfavorable comparisons, which signal needs for South Bend to improve in order to match the cities in whose company South Bend would like to be, are summarized in Figure 35 below. Our benchmarking was intentionally a comparison of South Bend to metropolitan areas that are clearly superior in order to identify what South Bend must improve. Accordingly, these signals of need for improvement these "brutal facts"--should motivate a driving force for positive change within the community. Figure 35: Summary of Observations Comparing South Bend to Indiana and National Benchmark Metropolitan Areas South Bend Compared to Indiana Metro Areas South Bend Compared to National Metro Areas Performance Measures Forbes' Best Places For Business & Careers 2009 Worst ranking in four Category Ranks: Job Growth Job Growth Projected Net Migration Subprime Mortgages Second worst ranking in Crime Rate Category Population Low Population Growth Rate High Outmigration Of Young, Single, Highly Educated People Low Prime Working Age Population Housing Low Percentage Of Housing Units Occupied Worst ranking in four Category Ranks: Culture and Leisure Educational Attainment Net Migration Subprime Mortgages Second worst ranking in Crime Rate Category Low Population Growth Rate High Outmigration Of Young, Single, Highly Educated People Low Prime Working Age Population Low Percentage Of Housing Units Occupied 13 Collins, James C., Good To Great (New York: HarperCollins, 2001), p. 71 and p. 88. Benchmarking South Bend 62

67 Figure 35: Summary of Observations Comparing South Bend to Indiana and National Benchmark Metropolitan Areas (Continued) South Bend Compared to Indiana Metro Areas Education Attainment High "Less Than High School" Percentage Low Weighted Workforce Education Index Low Talent Index Workforce Shrinking Labor Force (while Labor Force in Benchmark Metro's is growing) Shrinking Employment High Unemployment Low Science And Engineering Workforce Low Bohemian Index Low Creative Class Index Income and Wages Low Median Family Income Low Median Household Income High Poverty Rate Low Average Wages Per Job Low Average Wages In Manufacturing Low Median Annual Earnings In Science and Engineering Occupations K 12 Schools Low School Performance (i.e., Low Proficiency Test Scores & High RaMP Target) High "Students With Special Needs Index" Research & Development Patents Per 10,000 Employees is low Low Patenting Growth Low Traded Industry Establishments Growth Entrepreneurial Activity Low Entrepreneurial Activity Low rankings in the Entrepreneur.com "2006 Hot Cities For Entrepreneurs" Innovation Index Low Overall Innovation Index Low Human Capital Index Low Economic Dynamics Index Low Productivity And Employment Index South Bend Compared to National Metro Areas High "Less Than High School" Percentage Low Weighted Workforce Education Index Low Talent Index Shrinking Labor Force (while Labor Force in Benchmark Metro's is growing) Shrinking Employment High Unemployment Low Science And Engineering Workforce Low Bohemian Index Low Creative Class Index Low Median Family Income Low Median Household Income High Poverty Rate Low Average Wages Per Job Low Average Wages In Manufacturing Low Median Annual Earnings In Science and Engineering Occupations Low School Performance (i.e., Low Proficiency Test Scores & High RaMP Target) High "Students With Special Needs Index Patents Per 10,000 Employees is low Low Patenting Growth Low Traded Industry Establishments Growth Low Entrepreneurial Activity Low rankings in the Entrepreneur.com "2006 Hot Cities For Entrepreneurs" Low Overall Innovation Index Low Human Capital Index Low Economic Dynamics Index Low Productivity And Employment Index Benchmarking South Bend 63

68 Figure 35: Summary of Observations Comparing South Bend to Indiana and National Benchmark Metropolitan Areas (Continued) South Bend Compared to Indiana Metro Areas South Bend Compared to National Metro Areas Structural Characteristics Industry Clusters Employment LQs Highest LQ industries are declining industries Low LQ In All But One Of Indiana's Growth Industries Industry Clusters Shift Share Analysis Shift Share is negative in 15 of 23 industries Occupation Clusters LQ Is The Lowest In Indiana In Five Skilled Occupations: Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers 1.09 Health Care & Medical Science (Therapy, Counseling & Rehabilitation subcluster) 1.09 Natural Sciences & Environmental Mgmt 0.48 Building, Landscape & Construction Design 0.70 Engineering & Related Sciences 0.65 Low Employment Growth In Highest LQ Occupations LQ Is Less Than 1.00 In Five Of Indiana's Top 10 Growth Occupations Highest LQ industries are declining industries Low LQ In All But One Of The National Growth Industries Shift Share is negative in 15 of 23 industries LQ Is The Lowest In Six Skilled Occupations: Mathematics, Statistics, Data & Accounting 0.82 Information Technology 0.81 Natural Sciences & Environmental Mgmt 0.48 Building, Landscape & Construction Design 0.70 Engineering & Related Sciences 0.65 Technology Based Knowledge Clusters 0.95 Low Employment Growth In Highest LQ Occupations LQ Is Less Than 1.00 In Five Of The Nation's Top 10 Growth Occupations A Legacy Industry Mix Is The Root Cause The observations in which South Bend compares unfavorably to the Benchmark Metro's are not just a jumble of independent variables, but are linked in a network of causes and effects. Therefore, an informative step is a root cause analysis in which each effect is traced to its cause, eventually leading to the identification of a statement (the root cause) that can be acted upon in a way that will positively change the entire network. Benchmarking South Bend 64

69 Analyzing South Bend's unfavorable comparisons to the Benchmark Metro's by using a methodology called "5 Whys" (see inset below) reveals that South Bend's ranking lower than the Benchmark Metro's in Forbes "Best Places for Careers and Business" is attributable to the chain of causes illustrated by the Cause Map in Figure 36 and "Legacy Industry Mix" is the root cause. The term "Legacy Industry Mix" in the Cause Map is shorthand for the benchmarking observations indicating that: (i) South Bend's highest Employment Location Quotients are in the industries which historically shaped South Bend's economy transportation equipment manufacturing and metal products manufacturing but now are industries which are declining nationally, and (ii) South Bend's Employment Location Quotients are low in the industries which are growing nationally. The "5 Whys" Methodology The "5 Whys" methodology is used in the Analyze phase of the Six Sigma 14 DMAIC (Define, Measure, Analyze, Improve, Control) quality improvement methodology. It is an efficient tool that doesn't involve data segmentation, hypothesis testing, regression analysis, or other advanced statistical processes. By repeatedly asking the question "Why?" (five times is a good rule of thumb, but it might take more or fewer), an analyst can peel away the layers of symptoms, which can lead to identifying the root cause of a problem. Very often the ostensible reason for a problem will lead to another question. Here is a simple and humorous example adapted from the isixsigma Dictionary 15 : Problem Statement: You are on your way home from work and your car stops in the middle of the road. 1. Why did your car stop? Because it ran out of gas. 2. Why did it run out of gas? Because I didn't buy gas on my way to work. 3. Why didn't you buy gas this morning? Because I didn't have any money. 4. Why didn't you have any money? Because I lost it all last night in a poker game. 5. Why did you lose all your money in last night's poker game? Because I'm not good at "bluffing" when I don't have a good hand. As the example illustrates, the final "Why?" leads to a statement (the root cause) that can be acted upon. 14 Six Sigma is a quality management methodology, originally developed by Motorola, USA in 1981, that is widely used by organizations in many industry sectors. 15 isixsigma Dictionary ( Benchmarking South Bend 65

70 Figure 36: Cause Map for South Bend's Unfavorable Comparisons to Benchmark Metropolitan Areas Negative Net Migration Why? High Housing Vacancy Why? Why? Shrinking Workforce Low Entrepreneurial Activity Why? Why? Negative Employment Shift Share Why? Low Workforce Education Index Why? Low K 12 Schools Performance Why? High "Students with Special Needs Index" Why? Why? Why? Why? Why? Low Job Growth Why? Legacy Industry Mix Low Rank in Forbes "'Best Places for Business & Careers" Why? Why? High Subprime Mortgage Originations Why? Low Family Income Why? Low Skill/Pay Occupation Mix Why? Why? Why? Why? High Crime Rate Why? High Unemployment Low R & D Investment Arrows point to causes Benchmarking South Bend 66

71 A Vicious Circle Of Economic Decline Examination of the Cause Map further reveals that it depicts a network in which negative causes and effects iteratively reinforce each other. That is, the impact of a cause works its way through the network and returns to exacerbate the original condition, which sets off repetition of the cycle. The Vicious Circle of Economic Decline thus in operation in South Bend is illustrated in Figure 37. Figure 37: South Bend's Vicious Circle Of Economic Decline Legacy Industry Mix Low R & D Investment Low Skill / Pay Occupation Mix & Low Job Growth Low Entrepreneurial Activity Low Family Income Low Attractiveness for Business & Careers Negative Net Migration Workforce Deficiencies Benchmarking South Bend 67

72 South Bend's Vicious Circle of Economic Decline not only sustains itself but also increases its negative impact with each iteration. Hence, as long as the Legacy Industry Mix dominates South Bend's economy, the Vicious Circle will continue cycling and South Bend will be unable to achieve the improvements needed in order to join the company of the Benchmark Metro's. Richard Longworth aptly describes this predicament when he says in Caught in the Middle: America's Heartland in the Age of Globalism, his book about the decline of industry and the impact of globalization on the Midwest region: "The Italian philosopher Antonio Gramsci described the crisis of an era when 'the old is dying and the new cannot be born'. The Midwestern crisis is just the opposite. The future is already here, but the past refuses to die." 16 Also pertinent to South Bend's Vicious Circle of Economic Decline, is Longworth's statement in a 2008 speech to the Indianapolis Committee on Foreign Relations about the plight of Indiana cities: "There is a feeling here that good enough is good enough. Things keep slowly going down and down, but there's still food on the table. It's a slow motion catastrophe." 17 Confronting the brutal facts of its current reality is the only way South Bend can dispel any "feeling that good enough is good enough." Likewise, activating a driving force for positive change within the community is the only way South Bend can stop its Vicious Circle from making "things keep slowly going down and down" and producing "a slow motion catastrophe." South Bend cannot be satisfied with its present level of performance, which compares unfavorably to the Indiana Benchmark Metro's South Bend's Indiana neighbors--and to the National Benchmark Metro's--similar cities around the nation that are home to research universities. Much has been made recently of whether the University of Notre Dame should join an athletic conference for football and, if so, which one. Some people feel it should be the Big Ten because that would ensure ongoing competition with traditional rivals the league of teams in whose company Notre Dame likes to be. In a way, South Bend faces the same kind of aspiration. South Bend would like to perform as well as similarly situated metro's with research universities at their center. So, the National Benchmark Metro's are the league in which South Bend would like to play. While South Bend might never be able to surpass the performance of Ann Arbor or Madison, it should try to at least come close to the average performance of the National Benchmark Metro's. Consider, for example, the following: South Bend National Benchmarks Average 10-Year Employment Growth -6.4% +5.8% Average Wages Per Job $37,654 $43,196 Median Family Income $58,007 $72,574 Median Annual Earnings In Science & Engineering Jobs $49,520 $62, Longworth, Richard C., Caught in the Middle: America's Heartland in the Age of Globalism (New York: Bloomsbury, 2008), p "Author: Hoosiers in globalization denial--indiana not facing challenges of globalization", South Bend Tribune, November 15, 2008 Benchmarking South Bend 68

73 If South Bend met the average performance of the National Benchmark Metro's in just these four examples, then: South Bend would have over 18,000 more people employed. South Bend's average job would pay nearly $6,000 more per year. The income of a South Bend family earning the Median Family Income would be over $14,500 per year higher. Scientists and engineers who work in South Bend would be earning nearly $12,500 more. These examples vividly demonstrate another brutal fact that South Bend must confront: in order to achieve the economic and social quality of life to which it aspires, South Bend must find a way to at least come close to the average performance of the National Benchmark Metro's. Benchmarking South Bend 69

74 PART 3: BUILDING TOWARD IMPROVEMENT When Jim Collins, in Good To Great, states the imperative "confront the brutal facts", he also says "retain absolute faith that you can and will prevail in the end." 18 In the context of this study, "prevail in the end" means that South Bend can and will achieve improvements that if the benchmarking were repeated a decade from now--would result in the preponderance of data observations indicating that the South Bend compares favorably to the Benchmark Metropolitan Areas. More broadly, however, it means that South Bend will marshal its assets and activate a driving force for positive change that replaces the Vicious Circle of Economic Decline depicted in Figure 37 with a Virtuous Circle of Economic Vitality as depicted in Figure 40. The critical success factor for such change is eliminating the root cause of South Bend's unfavorable comparisons to the Benchmark Metro's: the Legacy Industry Mix that produces a concentration of employment in declining industries. South Bend must transform its current Legacy Industry Mix into a Growth Industry Mix a high concentration of employment in growing industries. Some metropolitan areas needing to escape the stranglehold of a similar Legacy Industry Mix have had the good fortune to have one or two existing clusters in growing industries, and their means of achieving improvement has been focusing their attention and resources on nurturing the growth of those clusters. Indianapolis, for example, has acted in accord with advice from Battelle Memorial Institute in 2000 that it should nurture its existing clusters in Advanced Manufacturing and Life Sciences. Over the past 10 years, those two clusters have become the pillars of increased economic vitality in Indianapolis and the Central Indiana region. South Bend, however, does not have existing Industry Clusters that can be nurtured to drive transition to a Growth Industry Mix. Except for Education And Knowledge Creation: (i) all nine clusters for which South Bend's 2008 LQ was greater than 1.00 are in declining industries and (ii) South Bend's 2008 LQ was less than 1.00 in all five of the industries that are growing both in Indiana and nationwide. Nevertheless, South Bend does have the basis to formulate strategies that would define its way forward. Some of the existing local assets and initiatives, as well programs underway elsewhere that could be emulated locally, which might support such strategies are described below. University Of Notre Dame Strategic Research Investments The University of Notre Dame is engaged in an extensive program of expanding its research enterprise through Strategic Research Investments (SRI). The SRI is a bold commitment of $80 million in internal funds, supplementing funding from external grants and gifts, all intended to advance Notre Dame's excellence in research. Furthermore, in 2010, Notre Dame s external faculty research awards exceeded $100 million for the first time in its history, fulfilling a goal President Rev. John I. Jenkins, C.S.C., stated during his 2005 inaugural address. 18 Collins, James C., Good To Great (New York: HarperCollins, 2001), p. 71 and p. 88. Benchmarking South Bend 70

75 Among the many cutting-edge research initiatives presently underway at Notre Dame, there are several, such as the following, which are producing technologies that directly relate to growing industries: Advanced Diagnostics and Therapeutics - designing micro-sensing devices capable of monitoring an individual s immediate environment and biomedical status. Sustainable Energy (i) developing safer nuclear energy focusing on actinide materials stabilization, (ii) designing cleaner fossil fuel processes focusing on materials for gas separations, and (iii) creating transformative solar energy technologies focusing on materials for conversion of solar to chemical energy. Environmental Change providing solutions to the interrelated problems of invasive species, land use, and climate change, focusing on their synergistic impacts on water resources. Genomics, Disease Ecology, and Global Health - focusing on eradicating insect-borne diseases, especially those that strike hardest in underdeveloped regions of the world. Nanoelectronics - exploring new device concepts and associated architectures that are enabled by novel phenomena on the nanometer scale, which includes the Midwest Institute for Nanoelectronics Discovery, one of four multi-university nanoelectronics centers for Semiconductor Research Corporation's Nanoelectronics Research Initiative, a public-private partnership that aims to maintain U.S. leadership in next-generation electronics by developing devices that exploit the unique properties of nanometer-scale materials. Notre Dame has partnered with Indiana and Purdue universities to complement its capabilities and to develop strong Indiana-based research collaborations. Notre Dame also has partnered with the City of South Bend, Project Future, Innovation Park, and Ignition Park. In the words of Robert Bernhard, Notre Dame's Vice President for Research: "The creation of the Midwest Institute for Nanoelectronics Discovery (MIND) at Notre Dame is a perfect first example of the type of result that can come from this partnership. We wrote a plan for a broad advanced program of research that included a path for commercialization of the discoveries that would come from the research through Innovation Park and Ignition Park. We were able to show that the City of South Bend and State of Indiana stood ready to assist in developing the facilities that would be needed when the discoveries were ready to be manufactured and commercialized. This is exactly the type of integrated program the corporate sponsors of MIND were seeking." 19 In addition to expanding its research endeavors, Notre Dame is significantly enhancing the operations of its Office of Technology Transfer. The Office of Technology Transfer (OTT) has become a more business-oriented service function focused on fulfilling objectives with regard to research and public service. OTT is continuously improving its ability to help university researchers identify and effectively commercialize promising new technologies, and help establish partnerships that can make new technologies available for public benefit. Further, OTT is working to maximize the opportunities for research collaborations between Notre Dame and industry partners. 19 Bernhard, Robert, "Watch Notre Dame's Progress As Research University". South Bend Tribune, April 23, Benchmarking South Bend 71

76 Existing Local Assets And Initiatives Universities produce raw materials for innovation such as knowledge products of recent scientific breakthroughs, as well as trained scientists and engineers. These products can be consumed locally or produced for export, that is, consumed outside of the region. However, a university is only one element of the technological infrastructure of innovation. If other elements are missing, innovation is less likely to be complete and the area will not capture the benefits of proximity to the research university 20. Recognizing this fact, local government, Project Future, the University of Notre Dame, Memorial Health System, Ivy Tech Community College in South Bend, and Purdue University's College of Technology at South Bend have created assets and launched initiatives to augment the technological infrastructure of innovation in South Bend and the surrounding region. Some of these assets and initiatives are briefly described below. Innovation Park At Notre Dame. Innovation Park at Notre Dame, is located on 12 acres adjacent to the Notre Dame campus. The first 54,000-square-feet building at Innovation Park was completed in October Innovation Park at Notre Dame will facilitate commercialization of all forms of research, by convening innovators throughout the entire Notre Dame community (including faculty, students, alumni and partners in the region) and beyond. Collaboration with Notre Dame's Office of Research and Technology Transfer aids Innovation Park in identifying and nurturing commercial opportunities arising from University research. Specific areas of University research expertise, including nanoelectronics, global health, flow physics, orthopedics, micro-sensing and energy provide fertile ground for recognition of new commercial ventures. A strong network of funding resources, from grant providers to angel investors and venture capital firms, allows Innovation Park clients access to critical early-stage funding. Prominent in Innovation Park s network is the IrishAngels, which comprises successful Notre Dame alumni and friends who are accredited investors with experience in entrepreneurial endeavors and provides market expertise to Innovation Park clients. The Innovation Park enjoys close relationships with many members of the IrishAngels network, which is managed by the Gigot Center for Entrepreneurial Studies at the Mendoza College of Business, and presents the network s investment forums. Fish Taco Ventures, an outgrowth of IrishAngels, is an investment fund that provides seed and early stage risk capital to Notre Dame students, alumni, faculty, and staff entrepreneurs. Launched in 2005, Fish Taco Ventures currently has four angel funds under management and 11 Notre Dame family ventures in its current portfolio. Innovation Park also enjoys good working relationships with regional and national venture capital firms. Project Future, the Indiana Economic Development Corporation, BioCrossroads, and the Indiana Venture Center are strong partners for the Innovation Park. These organizations provide the Park and its clients new venture expertise, funding support, and access to resources for emerging ventures. 20 Feldman, Mary Ann, "The University and Economic Development: The Case of Johns Hopkins University and Baltimore", Economic Development Quarterly, Vol. 8 No. 1, February 1994, pp Benchmarking South Bend 72

77 Ignition Park. Ignition Park is a technology park under development in South Bend on 83 acres of land owned by the City of South Bend. Ignition Park and Innovation Park are the two locations in South Bend that make up Indiana's first two-site State-Certified Technology Park, which was forged through the City of South Bend's partnership with Notre Dame, Project Future, and the State of Indiana. Successful companies formed at Innovation Park will be encouraged to move to Ignition Park, yet continue to receive support services and other benefits from being part of the same state-certified technology park. Planning is underway at Ignition Park for the siting of 3 million to 3.5 million square feet of high-tech, office and support space. In addition, the City of South Bend is working with the public and private research sectors to establish prototyping facilities at Ignition Park, which will be available for use by early stage companies. Ivy Tech Community College Associate s Degree In Nanotechnology Program Ivy Tech Community College s north central regional board of trustees today has approved a plan for certificate and associate s degree programs in nanotechnology at Ivy Tech's South Bend campus. Students in the program will take a series of courses including fundamentals of nanotechnology, nanoscience manufacturing, physics, nanoelectronics, nanofabrication and a required nanoscience internship. Ivy Tech hopes to establish on the South Bend campus a mock cleanroom, where students would learn to handle, calibrate and operate sensitive scientific equipment. Students seeking a bachelor's degree will be able to transfer 64 to 67 credit hours into the Bachelor of Science in Engineering Technology at Purdue's College of Technology in South Bend. Memorial Health System Community Innovation Center Memorial Health System has initiated the establishment of a Community Innovation Center, which it describes as follows: The greater South Bend community would greatly benefit from a community-wide focus on the best practices and best strategies of launching Innovation education, learning and training across all organizations. This can be best accomplished by developing a large Community Innovation Center (CIC) in a central location whereby all leaders from every organization, both non-profit, government, education, as well as all for-profits can easily, and inexpensively, access Innovation training and education. A comprehensive approach to education for Innovation that focuses on organization transformation will be offered in a creative setting, e.g., an Innovation Café, by highly skilled faculty teaching the country s best practices and most successful strategies. Faculty will come from experienced practitioners and successful entrepreneurs (with some prior failures and struggles along the way) who can use innovative teaching methods to create interest, spark enthusiasm and build team/personal self-sufficiency. The goals would be to have 5,000 community and organizational leaders go through the 2 days of Innovation education and training and begin to launch an Innovation Revolution in their organizations. Besides immersing each organization s leadership (generally 3-5 leaders including the CEO) in the 2-day overview of launching an Innovation Transformation, the CIC will also train and certify Innovation Experts from each organization in a weeklong intensive course so they can help lead and facilitate the Innovation process in their own organization. Benchmarking South Bend 73

78 The region covered would be St. Joseph County, and the collar counties of Elkhart, Marshall, LaPorte, Berrien and Cass. Teams of three persons from every organization in these six counties would be invited, and a good cross section from non-profits, government, education and faith based and for-profit firms would be ideal. Each organization would select its three attendees, but every effort would be made to attract the CEO and other C-suite leadership. Ideally, half of all attendees would be from private business and for-profits with the other half from the non-profit world, government, education and faith based leadership. The model that will be used is: CIC helps educate and change community leaders Leaders change their organizations to be more innovative, creative and successful Organizations help change their communities to be more open to view ideas and new possibilities Communities create the opportunities to help everyone realize their fullest potential Regional Economies leads to better jobs, better economic conditions, and an improved quality of life Michiana Partnership Project Future has initiated the formation of the "Michiana Partnership", which will be a regional economic development corporation serving the Indiana and Michigan counties generally known as "Michiana" (Indiana Elkhart, Kosciusko, Marshall, and St. Joseph counties; Michigan Berrien, Cass, and St. Joseph counties). Project Future and representatives of economic development organizations in four other Michiana counties (Kosciusko County and St. Joseph County, Michigan have not yet formally committed), joined by Indiana Michigan Electric Company and South Bend Regional Airport Authority, have agreed to form and financially support the Michiana Partnership and to engage the consultants listed below for services related to organizing and launching the Michiana Partnership. The Pokagon Band of Potawatomi Indians, in Southwest Michigan and Northern Indiana, also might join. Strategic Development Group, Bloomington, Indiana - Thayr Richie, Ph.D., an accomplished Indiana economic and community development professional who has served as executive director of the Indiana Department of Commerce, as a member of the South Central Indiana WIB, and as president of the Indiana Economic Development Association. Economic Development Solutions, Inc., Springfield, Illinois - Mark James, the nation's leading trainer on the use of technology in the economic development profession. Indiana Business Research Center at Kelley School of Business, Indiana University Carol Rogers who, as deputy director and CIO of the Indiana Business Research Center, directs its information systems and services and works extensively with economic developers, government officials and businesses, providing them with economic and demographic information for and about Indiana and its localities. Benchmarking South Bend 74

79 By September 2010, the legal structure of the organization will be in place, a web site will be up and running, and printed marketing materials will be ready to be distributed. Michiana TechConnection Michiana TechConnection is an initiative launched by Project Future in fall of 2009 to facilitate the emergence of technologies from Notre Dame's research into a process of innovation and entrepreneurial activity in South Bend and the surrounding region. The Michiana TechConnection ("MTC") project team is made up of representatives from Project Future and Notre Dame, expert community representatives, and a small number of top-notch consultants. Project Future charged the MTC team to: 1) investigate and analyze the research agendas of the University of Notre Dame and other Michiana research organizations, 2) identify and characterize the technology platforms emerging from Michiana research efforts, 3) quantify and rank the commercial potential of each technology platform for the Michiana region in concert with business sector subject matter experts, and 4) identify actions local government and other entities can take to ensure that the Michiana region realizes optimal economic benefit from the commercialization of research outcomes from Notre Dame and other research organizations. The specific deliverables to be produced by the MTC team are: 1) a portfolio process to enable ongoing management of Michiana research commercialization opportunities 2) the specification of a small, initial set of Core Technology Platforms that inherently contain fertile commercialization opportunities for economic development in Michiana 3) recommendations for an appropriate management/oversight structure; with suggested roles and responsibilities 4) an action plan to assist commercialization based upon the initial set of Core Technology Platforms action teams assembled and prepared to implement the action plan, utilizing University researchers/managing directors, and private sector business expertise a list of accelerators to Michiana technology commercialization 5) recommended countermeasures for any barriers that may be revealed. The workflow of the MTC team is represented visually in the diagram, prepared by Project Future, shown in Figure 38. Benchmarking South Bend 75

80 Figure 38: Workflow of the Michiana TechConnection Team Screen technologies sets and individual technologies; identify technology platforms review potential business concepts. Identify current level of technologies with respect to: Market place, technical and execution risks Total and regional economic impact Time to market and time to economic impact Investment required Unique circumstances or market conditions Business concept breadth Potential to impact other technology platforms Commercialization Review Global Regional Identify local accelerators or barriers for technologies with Michiana potential Establish Accelerators Eliminate or reduce barriers Launch marketing and sales effort to increase awareness of Michiana potential and attract support businesses Research We are here Business Plan Prototyping We need to establish effective accelerators here Production To Market Conduct research identifying private sector companies that may have interests in these developing technologies, to benefit: Researchers seeking liaisons and support in its search for tenants Project Future/Communities in search of business expansions Note: Project Future and/or other community partners will carry out these later tasks as they establish roles, responsibilities and an oversight structure. Benchmarking South Bend 76

81 The process being employed by MTC is one that major corporations like IBM, Kodak, Apple, et al, can run like clockwork internally, but has not been applied in the same manner to university-based researchers who are brilliant in their disciplines but lack other skill sets. At present, Michiana TechConnection has reviewed more than 35 technology areas and identified 13 technology platforms on which it is performing due diligence (i.e., verifying intellectual property status, testing the assumptions about commercial application potential, etc.). Upon completion of due diligence, MTC will have identified the first group of Core Technology Platforms which it will shepherd through the commercialization process. Brief descriptions of the 13 candidate technology platforms are attached in Appendix C. From even these brief descriptions, it is clear that all the candidate technology platforms relate directly to industries that are growing nationwide. After finalizing the first group of Core Technology Platforms, MTC began working to produce items 3, 4, and 5 in the list of deliverables set forth above. The MTC project team's initial implementation of this process will be the basis for establishing an "evergreen" process--a way of operating on a continuous basis to ensure that potentially great inventions are supported by all the competencies and resources needed to successfully achieve commercialization. Notre Dame Center For Research Computing The University of Notre Dame's Center for Research Computing ("CRC") has a high performance computing cluster that allows researchers to quickly process large amounts of data for scientific research. More than 50 diverse research groups are using the computational CRC resources, the most prolific being chemistry, biochemistry, bio-complexity and engineering (chemical, mechanical, civil and aerospace). Scientists are using CRC resources to examine everything from ways to develop clean fuels from crude oil to drug design. Other departments, such as social sciences, also use the resources of the CRC. Examples of Notre Dame research currently using the CRC's resources include: Modeling highly complex blood clotting processes to advance the understanding and treatment of heart disease, strokes and hemophilia. Using molecular simulation to develop a fundamental understanding of the link between the physical properties of materials and their chemical constitution, with a special focus on the properties of nanomaterials. Developing a molecular-level understanding of chemical reactivity at surfaces, which can be used to develop methods to prepare clean fuels from crude oil or coal and to transform chemical to electrical energy in fuel Creating computational models of coastal ocean hydrodynamics that can be applied to realworld problems, from dealing with coastal flooding due to hurricanes to helping map currents for shipping operations, dredging and harbor design Generating latent variable modeling and analysis as part of psychology research to determine how genomes affect behavior. Benchmarking South Bend 77

82 The CRC and St. Joe Valley Metronet could collaborate to enable Notre Dame research partners and other firms in the Michiana Region to use the CRC's computational resources to facilitate their research and development activities. Notre Dame ESTEEM Program The University of Notre Dame began in 2009 offering the ESTEEM Program, which is a one-year Masters of Science Program. It has been developed as a joint program of the College of Science, College of Engineering and Mendoza College of Business. The objective is to provide Science and Engineering graduates the skills required to take science and/or engineering inventions and translate those inventions into commercial ventures while strengthening their science and/or engineering skills. The ESTEEM program's innovative curriculum requires 12 credit hours of customized commercial courses covering such topics as finance, marketing, strategy, leadership, supply chain, project management, quality, operations research, ethics and financial mathematics. These courses have been constructed specifically to meet the needs of ESTEEM students. There are also six credit hours of science or engineering electives required to deepen the ESTEEM student s technical foundation. Purdue College of Technology BSET Program Purdue University will begin offering a Bachelor of Science in Engineering Technology program in fall 2010 at its College of Technology site in South Bend. Nanotechnology, alternative energy and automated controls are expected to be the concentrations in the degree program in South Bend. Those concentrations were chosen because of demand for trained workers by area employers and because of nanotechnology research occurring at the University of Notre Dame. The degree program is designed to provide workers for specific community needs and to give students an opportunity to earn a Purdue degree while staying close to home. As mentioned above, students will be able to transfer credit hours of approved course work from Ivy Tech Community College toward the Purdue bachelor's degree program. Small Business Development Center The North Central Small Business Development Center is part of the Indiana Small Business Development Center network serving the counties of St. Joseph, Elkhart, Marshall, Fulton, and Kosciusko. The North Central SBDC builds and supports strong entrepreneurial communities by providing small business owners with mentoring and training programs and access to a wide range of business resources. SBDC services are available in the following areas: Accounting/Budgeting Business Planning Buying/Selling a Business Cash Flow Management ecommerce Engineering R&D Financing/Capital Human Resources/Employee Management International Trade Legal Issues Managing a Business Marketing/Sales Start-up Assistance Tax Planning Benchmarking South Bend 78

83 Franchising Government Contracting Technology/Computers R & D Grants St. Joe Valley Metronet Ten years ago, community leaders in St. Joseph County recognized that the lack of high-speed broadband telecommunications connectivity was hampering the competitiveness of local businesses and institutions and would be a barrier to future development. Furthermore, businesses in St. Joseph County were paying four times as much as in Chicago for the same level of broadband service from the same providers. A coalition of local institutions, government entities, and businesses, led by Project Future, established St. Joe Valley Metronet, a public-private partnership, to surmount the connectivity barrier by building a fiber-optic backbone throughout the area. St. Joe Valley Metronet is now a network of more than 50 miles of carrier-grade, vendor-neutral dark fiber that has been operational since January The Metronet presently spans over 50 miles in and around South Bend and Mishawaka, and it has right of way access agreements that will allow ongoing expansion of the network. Similar in design to an on/off-ramp linked to a highspeed highway, the Metronet provides: A carrier-grade, fiber-optic metropolitan-area network, Carrier-neutral, state-of-the-art telecom infrastructure, The ability to link local users to long-haul trunk line points-of-presence, Easy access to many service vendors offering a wide variety of services and solutions, and Readily available, low-cost access to nearly unlimited bandwidth with high speed and flexibility. Programs Elsewhere That Could Be Models For South Bend Butler Business Accelerator The Butler Business Accelerator is a 4-year-old consultancy on the Butler University campus in Indianapolis. Its mission is to help grow privately owned Central Indiana companies that have been in business for at least five years, have $5 million to $50 million in annual sales, and are profitable and poised for growth. The Accelerator, part of Butler's College of Business Administration, is led by a former Bank One of Indiana CEO, who came aboard in August The consulting team of five also includes, the second-in-command, whose experience includes 19 years working for three Fortune 500 companies followed by a nine-year stint at global consulting firm Accenture. The Accelerator also has developed a large Alliance Partner Network that includes financial institutions, law firms and private contractors. These experts provide valuable strategic input to Accelerator clients throughout the consulting process. The Accelerator itself is advised by a panel consisting of 15 professionals whose careers include executive-level experience. The Accelerator offers fee-based consulting services based on the individual company's need, length of engagement, team size, and scope of work. Service offerings include Business Strategy, Operational Discipline, Organizational Development, Marketing Services, and CFO Services. Benchmarking South Bend 79

84 Accelerator consulting teams are led by project managers with extensive consulting experience. Teams include members of the Butler faculty with deep knowledge and expertise in specific functional areas, MBA and undergraduate students, and members of the Accelerator's Alliance Partner Network. Advisers spend roughly two years with clients to develop growth strategies. In addition, the Accelerator's $2 million investment fund provides a way for some clients to fund growth strategies such as marketing or advertising campaigns. As of first quarter 2010, the Accelerator has successfully completed 63 projects with 25 clients in 18 industries in the three years since its inception and has been successful in helping its clients grow. One company experienced a 35 percent increase in sales, resulting in a four-fold increase in free cash flow within one year. Another company's first quarter sales increased by 25 percent after the Accelerator assisted management in constructing an annual, growth-focused profit plan. A third client experienced an annual treasury savings of $35,000 and over $1 million in inventory reduction opportunities were revealed to a fourth client. FastTrac FastTrac is a program of the Ewing Marion Kauffman Foundation. It is a business development program designed to help entrepreneurs hone the skills needed to create, manage and grow a successful business. FastTrac participants work on their own business ideas or ventures throughout the course, moving their ventures to reality or new levels of growth. Experienced business counselors complement a course instructor by facilitating small-group and individual learning, as well as providing advice on class assignments. Guest entrepreneurs illustrate business concepts and share their real-life business experiences. FastTrac programs include: FastTrac NewVenture is specifically for entrepreneurs in the early stages of business development. It helps aspiring entrepreneurs define and evaluate business concepts, determine the viability of the business concept, and outline the critical steps to a successful business launch. Participants develop a feasibility study that covers marketing, product or service details, price/profitability, and a plan for further action. FastTrac TechVenture provides the tools to develop and/or hone the skills that technology entrepreneurs need to understand the business behind the technology skills to start, operate, fund, and grow a technology or life sciences business. FastTrac Planning is geared toward the business owner focusing on taking the company to new levels of growth and expanding business operations. The program covers the following topics: product/service plan, market research and analysis, marketing, operating and control systems, management and organization, legal issues, financial planning, projections and resources, and a growth plan. First Step FastTrac incorporates the FastTrac NewVenture course into a program for individuals with low to moderate income who are starting or expanding a small business. Kauffman Foundation makes the FastTrac program "courseware" available to Affiliates. FastTrac programs are delivered by a variety of Affiliate organizations: non-academic, academic, nonprofit and for-profit--including chambers of commerce, business development centers, local and regional economic development councils, colleges, universities, microenterprise organizations, and consulting firms. Among the Benchmark Metro's studied in this report, Affiliates deliver FastTrac programs in Evansville, Fort Wayne, Ann Arbor, Lexington, and Wichita. Benchmarking South Bend 80

85 JumpStart, Inc. JumpStart Inc., a 501(c)(3) corporation based in Cleveland, Ohio, has been operating since 2004 a program that has proven its ability to dramatically accelerate the growth and progress of Northeast Ohio s startup community. This work provides newly formed companies developed out of local universities, research institutions, and the general public, guidance and assistance they need to: get up and running, devise and perfect their initial business plans, access state and federal grants, access angel and venture capital, build a board of directors, and hire C-level talent to take the company to the next level of development and wealth creation. Since 2004, JumpStart s efforts have provided over 70,000 hours of assistance to very early-stage companies and have helped these companies secure over $140 million in follow-on funding. The capital these companies have secured has enabled them to create over 575 new direct and indirect jobs. Partners of JumpStart include the Economic Development Administration, national foundations, and major regional community and corporate foundations. JumpStart believes it has a proven model in place and is interested in expanding JumpStart s activities across the U.S., in partnership with interested parties looking to accelerate the transformation of regional economies. Currently JumpStart is in conversations with 10+ communities across the U.S. discussing how they can assist each of these communities establish operations or programs similar to JumpStart. Potential Strategies The assets and initiatives described above could support strategies to: Capitalize on research at the University of Notre Dame by encouraging research collaborations between Notre Dame and regional industry partners, and supporting local commercialization of growth-industry technologies emerging from Notre Dame. Educate, retrain, and retain a workforce that has skills to do the jobs likely to be needed by growth-industry businesses that locally commercialize Notre Dame research. Build a population of technology-intensive, growth industry firms by stimulating innovation and entrepreneurial activity, and nurturing the growth of both first-stage (1-9 employees, $0- $1 million revenue) and second-stage (10-99 employees, $1 million-$50 million revenue) companies within the region. Increase local availability of sources of funding to support new business formation, including: Proof-Of-Concept Funding (to deliver proof of technology capability), Pre-Seed Funding (for technology and business concept development), Benchmarking South Bend 81

86 Seed Funding (for product platform development and business formation completion), and Venture Capital (for early stage business startup operations). Create regional linkages among the counties comprising the South Bend-Mishawaka Metropolitan Area (St. Joseph County, Indiana and Cass County, Michigan) and neighboring counties to enable building a collaborative regional strategy, making strategic investment decisions, and implementing a regional approach to economic development. Provide readily available, low-cost access to high performance telecommunications and computing resources to enable ultrafast connectivity and rapid processing of large amounts of data for research, prototyping, and testing. Facilitate regional and global connectivity between local growth-industry businesses and institutions with their counterparts and clients. Transforming The Industry Mix--A Solutions Map Earlier we found it informative to view the observations in which South Bend compares unfavorably to the Benchmark Metro's in a Cause Map (Figure 36). In constructing the Cause Map, we repeatedly asked "Why?" in order to link the unfavorable comparison factors and trace back to their root cause a Legacy Industry Mix. Likewise, it is informative to view the assets and initiatives described above (and, implicitly, the strategies we have suggested these assets and initiatives might support) in a Solutions Map. In constructing the Solutions Map displayed in Figure 39, we begin with "Industry Mix Transformed From Legacy To Growth" as the "root solution". Then we repeatedly ask "How?" in order to identify and link the assets and initiatives that enable this root solution. Benchmarking South Bend 82

87 Figure 39: Solutions Map For South Bend's Legacy Industry Mix Regional Linkages How? Michiana Partnership How? Small Bus. Dev. Center How? FastTrac Startup Assistance / Incubation How? Ignition Park How? How? How? Startups In Growth Industries How? Notre Dame Technology Comm'lized How? Michiana TechConnection How? Increased Entrepreneurial Activity How? How? Innovation Park Industry Mix Transformed From Legacy To Growth How? How? How? Expansion Of Growth Industry Firms Workforce With Growth Industry Skills How? How? How? Ivy Tech Nanotech Program Notre Dame ESTEEM Program How? Increased Innovation / R & D How? How? How? B.U. Business Accelerator Model Community Innovation Center High Perf. Comm. & Computing How? How? Funding For Formation / Expansion St. Joe Valley Metronet ND Center For Research Computing How? JumpStart Model How? Purdue BSET Program Denotes Possible Future Local Initiatives Benchmarking South Bend 83

88 A Virtuous Circle Of Economic Vitality Examination of the Solutions Map further reveals that it depicts a network in which the enabling assets and initiatives positively reinforce each other. That is, the impact of an enabler works its way through the network and returns to improve the original condition, which sets off positive repetition of the cycle. Therefore, if South Bend marshals its assets and activates a driving force for positive change by pursuing strategies such as those outlined above, it can replace the Vicious Circle of Economic Decline depicted in Figure 37 with the Virtuous Circle of Economic Vitality depicted in Figure 40. Figure 40: South Bend's Virtuous Circle of Economic Vitality Local Commercialization of ND Research Industry Mix Changing from Legacy to Growth Increase in Innovation & Entrepreneurial Activity Higher Attractiveness for Business & Careers Regional Linkages Workforce Trained in Growth Industry Skill Sets Startups & Expansions of Growth Industry Firms Increased Opportunity for Employment & Advancement Benchmarking South Bend 84

89 South Bend must recognize, however, that the following will be critical success factors: A high level of collaboration and participation by private sector firms, educational institutions, nonprofit and philanthropic organizations, and government entities, Disciplined thinking to maintain a focus on eliminating the root cause the Legacy Industry Mix instead of treating its symptoms, and Funding from government agencies, philanthropic organizations, and private sector firms sufficient to pay for activities needed to implement the strategies. Finally, South Bend must further recognize that the transformation will not happen in one fell swoop. Rather, inspired again by Jim Collins' Good To Great 21, we envision the Virtuous Circle process as resembling the relentless pushing of a giant heavy flywheel in one direction, turn upon turn, building momentum until a point of breakthrough, and beyond. Local Commercialization of ND Research Industry Mix Changing from Legacy to Growth Increase in Innovation & Entrepreneurial Activity Higher Attractiveness for Business & Careers Regional Linkages Breakthrough Buildup Collaboration Disciplined Thinking Funding Workforce Trained in Growth Industry Skill Sets Startups & Expansions of Growth Industry Firms Increased Opportunity for Employment & Advancement 21 Collins, James C., Good To Great (New York: HarperCollins, 2001) Benchmarking South Bend 85

90 APPENDIX A DATA TABLES Benchmarking South Bend 86

91 Index of Tables Table 1: Forbes 2009 Best Places For Business And Careers Ranking South Bend and Indiana Benchmark Metropolitan Areas 89 Table 2: Forbes 2009 Best Places For Business And Careers Ranking South Bend and National Benchmark Metropolitan Areas 90 Table 3: Population South Bend and Indiana Benchmark Metropolitan Areas 91 Table 4: Population South Bend and National Benchmark Metropolitan Areas 92 Table 5: Housing South Bend and Indiana Benchmark Metropolitan Areas 93 Table 6: Housing South Bend and National Benchmark Metropolitan Areas 94 Table 7: Educational Attainment South Bend and Indiana Benchmark Metropolitan Areas 95 Table 8: Educational Attainment South Bend and National Benchmark Metropolitan Areas 96 Table 9: Labor Force And Employment South Bend and Indiana Benchmark Metropolitan Areas 97 Table 10: Labor Force And Employment South Bend and National Benchmark Metropolitan Areas 98 Table 11: Other Workforce Indicators South Bend and Indiana Benchmark Metropolitan Areas 99 Table 12: Other Workforce Indicators South Bend and National Benchmark Metropolitan Areas 100 Table 13: Income South Bend and Indiana Benchmark Metropolitan Areas 101 Table 14: Income South Bend and National Benchmark Metropolitan Areas 102 Table 15: Average Wages Per Job South Bend and Indiana Benchmark Metropolitan Areas 103 Table 16: Average Wages Per Job South Bend and National Benchmark Metropolitan Areas 104 Table 17: K-12 Public Schools South Bend and Indiana Benchmark Metropolitan Areas 105 Table 18: K-12 Public Schools South Bend and National Benchmark Metropolitan Areas 106 Table 19: Research and Development South Bend and Indiana Benchmark Metropolitan Areas 107 Table 20: Research and Development South Bend and National Benchmark Metropolitan Areas 108 Table 21: Entrepreneurial Activity Indicators South Bend and Indiana Benchmark Metropolitan Areas 109 Table 22: Entrepreneurial Activity Indicators South Bend and National Benchmark Metropolitan Areas 110 Benchmarking South Bend 87

92 Index of Tables (Continued) Table 23: Innovation Index South Bend and Indiana Benchmark Metropolitan Areas 111 Table 24: Innovation Index South Bend and National Benchmark Metropolitan Areas 113 Table 25: Industry Clusters - Location Quotients South Bend and Indiana Benchmark Metropolitan Areas 115 Table 26: Industry Clusters - Percentage Growth in Number of Employees to 2008 South Bend and Indiana Benchmark Metropolitan Areas 116 Table 27: Industry Clusters - Location Quotients South Bend and National Benchmark Metropolitan Areas 117 Table 28: Industry Clusters - Percentage Growth in Number of Employees to 2008 South Bend and National Benchmark Metropolitan Areas 118 Table 29: South Bend's Industry Clusters - Employment Shift Share 2001 to Table 30: Occupation Cluster Location Quotients South Bend and Indiana Benchmark Metropolitan Areas 120 Table 31: Occupation Clusters - Percentage Growth In Number Of Employees South Bend and Indiana Benchmark Metropolitan Areas 121 Table 32: Occupation Cluster Location Quotients South Bend and National Benchmark Metropolitan Areas 122 Table 33: Occupation Clusters Percentage Growth In Number Of Employees South Bend and National Benchmark Metropolitan Areas 123 Benchmarking South Bend 88

93 Table 1: Forbes 2009 Best Places For Business And Careers Ranking South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metro Areas Best Places For Business & Careers Ranking 10 South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Overall Rank (1 is best) Category Ranks: Colleges a Cost of Doing Business b Cost of Living c Crime Rate d Culture and Leisure e Educational Attainment f Income Growth g Job Growth g Job Growth Projected h Net Migration g Subprime Mortgages i ameasure of 4-year colleges in area with extra credit for schools highly rated in Forbes America's Best Colleges 2009 ( bindex based on cost of labor, energy, taxes and office space. cindex based on cost of housing, utilities, transportation and other expenditures. dcrimes per 100,000 residents. eindex based on museums, theaters, golf course, sports teams and other activities. fshare of Population over age 25 with a bachelor's degree or higher. g5-year annualized figures. h3-year annualized figure. ias a percent of total originations between 2005 and Sources used by Forbes: Moody's Economy.com; Sperling's BestPlaces. Please note: Superscripted numbers 1-39 in this and subsequent Tables refer to Endnotes in Appendix B. Benchmarking South Bend 89

94 Table 2: Forbes 2009 Best Places For Business And Careers Ranking South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas Best Places For Business & Careers Ranking 10 South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Overall Rank (1 is best) Category Ranks: Colleges a Cost of Doing Business b Cost of Living c Crime Rate d Culture and Leisure e Educational Attainment f Income Growth g Job Growth g Job Growth Projected h Net Migration g Subprime Mortgages i ameasure of 4-year colleges in area with extra credit for schools highly rated in Forbes America's Best Colleges 2009 ( bindex based on cost of labor, energy, taxes and office space. cindex based on cost of housing, utilities, transportation and other expenditures. dcrimes per 100,000 residents. eindex based on museums, theaters, golf courses, sports teams and other activities. fshare of Population over age 25 with a bachelor's degree or higher. g5-year annualized figures. h3-year annualized figure. ias a percent of total originations between 2005 and Sources used by Forbes: Moody's Economy.com; Sperling's BestPlaces. Benchmarking South Bend 90

95 Table 3: Population South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas Population Indicator 11 South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Total Population in , , ,154 1,715,459 6,376, ,059,724 Population Distribution by Age in 2008: Preschool (0 to 4) 6.9% 6.5% 7.5% 7.6% 6.9% 6.9% School Age (5 to 17) 18.1% 16.8% 19.2% 19.1% 18.0% 17.6% College Age (18 to 24) 11.0% 9.7% 8.7% 8.3% 9.6% 9.8% Prime Working Age (25 to 54) 39.8% 41.4% 41.9% 44.3% 42.0% 42.3% Older Adult (55 to 64) 11.2% 11.6% 10.8% 10.1% 10.9% 10.8% Senior (65 plus) 13.0% 14.0% 12.0% 10.6% 12.6% 12.6% Median Age Population Growth: Growth (%) % 7.8% 16.0% 32.5% 15.0% 22.2% Growth (%) % 17.4% 25.5% 49.5% 22.7% 49.6% Population Change in 2008 by Component: Net Change-Total 0.21% 0.12% 0.45% 1.33% 0.63% 0.92% Net Domestic Migration ( ) -0.45% -0.27% -0.43% 0.40% -0.03% n/a Net International Migration ( ) 0.15% 0.05% 0.15% 0.14% 0.12% 0.30% Natural Increase (births minus deaths) 0.51% 0.34% 0.73% 0.80% 0.54% 0.62% Net Domestic Migration of Young, Single, College-Educated to % % -9.54% 13.00% % 0.92% Indiana Total U.S. Total Benchmarking South Bend 91

96 Table 4: Population South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas Population Indicator 11 South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Total Population in , , , , , , ,059,724 Population Estimates by Age in 2008: Preschool (0 to 4) 6.9% 5.4% 6.1% 6.9% 6.4% 7.8% 6.9% School Age (5 to 17) 18.1% 16.0% 15.5% 16.1% 15.7% 19.3% 17.6% College Age (18 to 24) 11.0% 11.2% 16.6% 11.3% 12.4% 9.3% 9.8% Prime Working Age (25 to 54) 39.8% 42.0% 42.6% 44.3% 44.5% 41.5% 42.3% Older Adult (55 to 64) 11.2% 11.8% 10.2% 10.6% 10.8% 10.1% 10.8% Senior (65 plus) 13.0% 13.6% 9.0% 10.8% 10.2% 12.0% 12.6% Median Age Population Growth: Growth (%) % 5.50% 22.80% 30.10% 29.90% 18.10% 22.20% Growth (%) % 14.30% 48.40% 70.00% 60.60% 37.20% 49.60% Population Change in 2008 by Component Net Change-Total 0.21% 0.24% -0.21% 1.63% 1.27% 1.39% 0.92% Net Domestic Migration ( ) -0.45% -0.18% -1.34% 0.72% 0.30% 0.36% n/a Net International Migration ( ) 0.15% 0.12% 0.45% 0.23% 0.25% 0.18% 0.30% Natural Increase (births minus deaths) 0.51% 0.29% 0.68% 0.68% 0.72% 0.84% 0.62% Net Domestic Migration of Young, Single, College-Educated to % % -1.02% % % % n/a U.S. Total Benchmarking South Bend 92

97 Table 5: Housing South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas Housing South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Housing Units , , , ,555 2,795, ,065,264 Occupied Units , , , ,099 2,463, ,386,298 Owner Occupied Units 11 88, , , ,043 1,772,901 75,363,085 Renter Occupied Units 11 31,711 40,726 43, , ,799 37,023,213 Percentage of Units Occupied 86.4% 92.3% 92.7% 89.7% 88.1% 87.1% Percentage of Units Owner Occupied 63.6% 66.2% 67.3% 62.3% 63.4% 58.4% Percentage of Units Renter Occupied 22.8% 26.1% 25.4% 27.4% 24.7% 28.7% Median Value of Owner Occupied units 12 $120,600 $111,200 $113,800 $147,200 $125,200 $197,600 Median selected monthly owner costs as a percentage of household income in the past 12 months: 11 Total 19.5% 17.8% 18.3% 20.3% 19.3% 21.6% Housing Units with a Mortgage 22.3% 20.5% 20.8% 22.3% 21.9% 25.0% Housing Units without a Mortgage 12.8% 11.0% 10.2% 11.4% 11.8% 12.7% Median Gross Rent 11 $690 $609 $611 $728 $670 $819 Home Price Ratio (i.e., Median Value of Owner- Occupied Units/Median Household Income) Indiana Total U.S. Total Benchmarking South Bend 93

98 Table 6: Housing South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Housing Housing Units , , , , , , ,065,264 Occupied Units , , , , , , ,386,298 Owner Occupied Units 11 88, ,453 85, , , ,483 75,363,085 Renter Occupied Units 11 31, ,552 48,844 70,736 74,847 72,908 37,023,213 Percentage of Units Occupied 86.4% 85.6% 84.2% 90.0% 88.1% 93.1% 87.1% Percentage of Units Owner Occupied 63.6% 57.1% 53.5% 55.7% 58.1% 64.3% 58.4% Percentage of Units Renter Occupied 22.8% 28.5% 30.6% 34.3% 30.0% 28.9% 28.7% Median Value of Owner Occupied units 12 $120,600 $197,400 $223,500 $155,500 $232,600 $118,300 $197,600 Median selected monthly owner costs as a percentage of household income in the past 12 months: 11 Total 19.5% 20.7% 22.6% 19.1% 23.2% 18.4% 21.6% Housing Units with a Mortgage 22.3% 23.4% 24.9% 21.4% 25.3% 20.9% 25.0% Housing Units without a Mortgage 12.8% 13.7% 12.8% 9.8% 13.0% 11.2% 12.7% Median Gross Rent 11 $690 $807 $871 $665 $805 $620 $819 Home Price Ratio (i.e., Median Value of Owner-Occupied Units/Median Household Income) Benchmarking South Bend 94

99 Table 7: Educational Attainment South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Attainment level as a percentage of population 25 and older: 12 Less than high school 14.1% 13.8% 11.7% 11.3% 13.8% 15.0% High School Grad (inc. equiv.) 38.9% 43.6% 38.2% 35.7% 41.9% 34.9% Some college (at least a year), but no degree 14.6% 14.2% 15.9% 14.1% 13.9% 14.9% Associate s Degree 7.2% 9.1% 9.2% 7.1% 7.5% 7.5% Bachelor s Degree 15.5% 12.7% 17.0% 21.0% 14.8% 17.5% Master s or Professional School Degree 8.3% 6.0% 7.4% 9.6% 7.2% 9.0% Doctorate Degree 1.4% 0.7% 0.5% 1.1% 0.9% 1.2% Weighted Workforce Education Index Talent Index Benchmarking South Bend 95

100 Table 8: Educational Attainment South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Attainment level as a percentage of population 25 and older: 12 Less than high school 14.1% 9.3% 6.3% 11.6% 6.0% 11.1% 15.0% High School Grad (inc. equiv.) 38.9% 35.3% 22.2% 32.1% 30.1% 36.3% 34.9% Some college (at least a year), but no degree 14.6% 11.4% 13.7% 15.3% 15.1% 17.6% 14.9% Associate s Degree 7.2% 11.1% 6.4% 7.2% 9.0% 7.2% 7.5% Bachelor s Degree 15.5% 17.5% 25.3% 19.7% 23.6% 19.0% 17.5% Master s or Professional School Degree 8.3% 13.6% 20.2% 11.8% 12.9% 8.1% 9.0% Doctorate Degree 1.4% 1.9% 5.8% 2.2% 3.3% 0.8% 1.2% Weighted Workforce Education Index Talent Index Benchmarking South Bend 96

101 Table 9: Labor Force And Employment South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas Labor Force & Employment Indicators 16 South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Total Labor Force in , , , ,494 3,230, ,287,000 5-year % change 1.2% -1.2% 1.5% 5.3% 2.0% 5.3% 10-year % change -2.5% 0.7% 1.8% 12.9% 3.4% 12.1% Employed in , , , ,210 3,039, ,362,000 5-year % change -0.2% -1.7% 0.8% 4.9% 1.4% 5.5% 10-year % change -6.4% -1.1% -1.7% 9.6% 0.2% 10.6% Unemployed in ,635 9,534 12,832 46, ,572 8,924,000 5-year % change 27.4% 8.4% 15.2% 13.1% 13.3% 1.7% 10-year % change 136.2% 47.2% 135.9% 156.3% 109.3% 43.7% Unemployment Rate in % 5.3% 6.0% 5.1% 5.9% 5.8% 5-year % change 6.3% 10.4% 13.2% 6.3% 11.3% -3.3% 10-year % change 121.7% 47.2% 130.8% 121.7% 103.4% 28.9% Indiana Total U.S. Total Benchmarking South Bend 97

102 Table 10: Labor Force And Employment South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas Labor Force & Employment Indicators 16 South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Total Labor Force in , , , , , , ,287,000 5-year % change 1.2% 3.0% 0.3% 4.8% 4.9% 5.5% 5.3% 10-year % change -2.5% 5.7% 8.2% 8.8% 11.5% 7.1% 12.1% Employed in , , , , , , ,362,000 5-year % change -0.2% 2.3% -1.6% 4.5% 5.2% 8.3% 5.5% 10-year % change -6.4% 4.1% 3.7% 5.5% 9.6% 6.0% 10.6% Unemployed in ,635 23,014 10,911 12,101 11,888 13,513 8,924,000 5-year % change 27.4% 18.6% 44.4% 10.2% -4.9% -33.8% 1.7% 10-year % change 136.2% 48.1% 263.8% 167.1% 113.5% 41.0% 43.7% Unemployment Rate in % 5.0% 5.9% 5.1% 3.5% 4.2% 5.8% 5-year % change 6.3% 13.6% 43.9% 4.1% -10.3% -37.3% -3.3% 10-year % change 121.7% 38.9% 227.8% 142.9% 94.4% 31.3% 28.9% U.S. Total Benchmarking South Bend 98

103 Table 11: Other Workforce Indicators South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Science & Engineering Workforce Number Employed in Science and Engineering Occupations 17 3,470 3,680 7,250 32,770 62,710 5,407,710 Percentage of Workforce Employed in Science and Engineering Occupations % 2.1% 3.4% 3.7% 3.2% 4.1% Science & Engineering Workforce Index Creativity Indexes Bohemian Index Creative Class Index Benchmarking South Bend 99

104 Table 12: Other Workforce Indicators South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Science & Engineering Workforce Number Employed in Science and Engineering Occupations 17 3,470 21,970 14,950 9,940 22,640 13,780 5,407,710 Percentage of Workforce Employed in Science and Engineering Occupations % 5.1% 7.6% 4.1% 6.9% 4.8% 4.1% Science & Engineering Workforce Index Creativity Indexes Bohemian Index Creative Class Index Benchmarking South Bend 100

105 Table 13: Income South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Per Capita Personal Income 21 Per Capita Personal Income 2007 $34,638 $34,832 $33,173 $38,455 $33,215 $38,615 % of U.S. Per Capita Personal Income 89.7% 90.2% 85.9% 99.6% 86.0% 100.0% Per capita income (adj. for inflation) $29,472 $30,066 $32,520 $34,352 $30,108 $32,728 Per capita income (adj. for inflation) $27,308 $27,131 $29,026 $30,256 $26,628 $29,640 Per capita income (adj. for inflation) $24,556 $25,530 $26,234 $26,497 $24,508 $25, year adjusted % change 17.5% 15.9% 2.0% 11.9% 10.3% 18.0% 20-year adjusted % change 26.8% 28.4% 14.3% 27.1% 24.7% 30.3% 30-year adjusted % change 41.1% 36.4% 26.5% 45.1% 35.5% 52.4% Median Family & Household Income 22 Median Family Income in the past 12 months (in 2008 inflation-adjusted dollars) $58,007 $60,896 $60,726 $67,609 $59,380 $63,366 Median Household Income in the past 12 months (in 2008 inflation-adjusted dollars) $45,192 $46,111 $49,536 $54,266 $48,675 $52,175 Poverty Rate 21 Poverty Rate % 11.7% 10.4% 10.9% 12.3% 13.0% Benchmarking South Bend 101

106 Table 14: Income South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Per Capita Personal Income 21 Per Capita Personal Income 2007 $34,638 $39,105 $40,905 $37,253 $42,557 $38,552 $38,615 % of U.S. Per Capita Personal Income 89.70% % % 96.47% % 99.84% % Per capita income (adj. for inflation) $29,472 33,628 $38,753 33,137 35,367 32,636 32,728 Per capita income (adj. for inflation) $27,308 30,903 $35,371 29,217 30,898 30,078 29,640 Per capita income (adj. for inflation) $24,556 24,954 $30,456 $23,516 27,866 26,324 25, year adjusted % change 17.5% 16.3% 5.6% 12.4% 20.3% 18.1% 18.0% 20-year adjusted % change 26.8% 26.5% 15.6% 27.5% 37.7% 28.2% 30.3% 30-year adjusted % change 41.1% 56.7% 34.3% 58.4% 52.7% 46.5% 52.4% Median Family & Household Income 22 Median Family Income in the past 12 months (in 2008 inflation-adjusted dollars) $58,007 $74,523 $83,206 $64,049 $78,971 $62,121 $63,366 Median Household Income in the past 12 months (in 2008 inflation-adjusted dollars) $45,192 $57,930 $60,713 $49,325 $60,818 $49,092 $52,175 Poverty Rate 21 Poverty Rate % 10.2% 12.7% 14.7% 10.4% 12.1% 13.0% Benchmarking South Bend 102

107 Table 15: Average Wages Per Job South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Average Wages Per Job 21 Average Wages Per Job : $37,654 $38,304 $36,806 $43,128 $38,403 $45,563 % of U.S. Average Wage Per Job % 84.07% 80.78% 94.66% 84.29% % Growth $1,203 $1,018 -$1,973 $321 -$85 $3,314 Change % % 2.7% -5.1% 0.7% -0.2% 7.8% Average Wages Per Job by Industry 21 Average Wages Per Job by Industry : Total Covered Employment 131, , , ,327 2,872, ,805,659 Avg Wages Per Job $37,647 $38,310 $36,798 $43,132 $38,403 $45,563 Manufacturing - % of all jobs 14.3% 18.4% 17.5% 10.9% 18.2% 10.0% Avg Wages Per Job $52,956 $55,197 $49,560 $67,038 $52,376 $54,457 Transportation and Warehousing - % of all jobs 0.6% 4.1% 4.9% 5.9% 4.6% 4.0% Avg Wages Per Job $52,824 $39,741 $40,023 $39,195 $39,227 $44,976 Health Care, Social Assist. - % of all jobs 13.5% 13.6% 14.9% 11.2% 12.9% 12.9% Avg Wages Per Job $41,130 $39,732 $39,468 $45,089 $39,247 $42,716 Finance and Insurance - % of all jobs 3.5% 2.3% 4.4% 4.9% 3.4% 4.4% Avg Wages Per Job $54,983 $43,322 $54,449 $62,473 $52,937 $85,188 Wages in Science & Engineering Jobs 17 Median Annual Earnings in Science and Engineering Occupations $49,520 $55,610 $60,220 $62,430 no data no data Benchmarking South Bend 103

108 Table 16: Average Wages Per Job South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Average Wages Per Job 21 Average Wages Per Job 2008: $37,654 $43,912 $48,987 $40,034 $42,623 $40,423 $45,563 % of U.S. Average Wage Per Job % 96.38% % 87.87% 93.55% 88.72% % Growth $1,203 $2,396 $674 $1,979 $4,026 $485 $3,314 Change % % 5.8% 1.4% 5.2% 10.4% 1.2% 7.8% Average Wages Per Job by Industry 21 Average Wages Per Job by Industry 2008: Total Covered Employment 131, , , , , , ,805,659 Avg Wages Per Job $37,647 $43,902 $48,964 $40,032 $42,632 $40,421 $45,563 Manufacturing - % of all jobs 14.3% 5.2% 8.3% 14.2% 9.4% 22.4% 10.0% Avg Wages Per Job $52,956 $61,288 $70,932 $57,435 $49,859 $57,939 $54,457 Transport'n & Warehousing - % of all jobs 0.6% 1.9% 2.1% 3.4% 2.3% 3.2% 4.0% Avg Wages Per Job $52,824 $44,476 $53,739 $41,983 $38,310 $36,906 $44,976 Health Care, Social Assist. - % of all jobs 13.5% 13.7% 12.0% 9.5% 10.2% 11.6% 12.9% Avg Wages Per Job $41,130 $38,072 $45,527 $46,297 $42,417 $40,014 $42,716 Finance and Insurance - % of all jobs 3.5% 4.7% 1.5% 2.8% 6.6% 2.7% 4.4% Avg Wages Per Job $54,983 $62,583 $60,195 $55,569 $59,812 $46,400 $85,188 Wages in Science & Engineering Jobs 17 Median Annual Earnings in Science and Engineering Occupations $49,520 $65,560 $66,350 $56,810 $56,070 $65,210 no data Benchmarking South Bend 104

109 Table 17: K 12 Public Schools South Bend and Indiana Benchmark Metropolitan Areas South Bend 1 Indiana Benchmark Metropolitan Areas Evansville 2 Fort Wayne 3 Indianapolis 4 South Bend Community School Corp. Evansville- Vanderburgh School Corp. Fort Wayne Community Schools Indianapolis Public Schools Indiana Average K-12 Public School System - Data for Largest Enrollment System in the MSA 23 : Enrollment 21,769 22,190 31,884 37,057 3,546 Students with Special Needs Index Economically Disadvantaged Enrollment 62.3% 50.2% 56.5% 82.9% 37.5% Students with Disabilities Enrollment 9.7% 21.8% 19.1% 19.4% 17.1% English Language Learners Enrollment 23.3% 1.3% 5.3% 9.7% 4.%1 Students per teacher Graduation Rate (using Urban Institute's Cumulative Promotion Index) State Test - English Language Arts Proficiency 57.0% 63.8% 60.2% 48.0% 70.3% State Test - Math Proficiency 58.6% 63.0% 65.9% 50.8% 72.8% Instructional expenditures per student $10,200 $9,314 $9,243 $10,835 $8,929 Did this district make Adequate Yearly Progress in 2008? 26 NO NO NO NO n/a RaMP Up Target; i.e., How much progress must the district make per year to reach 100% proficiency by 2014? % 5.2% 5.3% 7.2% 4.1% Benchmarking South Bend 105

110 Table 18: K 12 Public Schools South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 South Bend Community School Corp. Albany City School District Ann Arbor Public Schools Fayette County Schools Madison Metropolitan Schools Wichita Schools K-12 Public School System - Data for Largest Enrollment System in the MSA 23 : Enrollment 21,769 8,924 16,742 35,416 24,755 46,922 Students with Special Needs Index Economically Disadvantaged Enrollment 62.3% 66.8% 16.4% 42.2% 40.1% 66.3% Students with Disabilities Enrollment 9.7% 23.7% 12.6% 10.7% 17.4% 14.8% English Language Learners Enrollment 23.3% 3.4% 5.9% 5.6% 14.2% 11.8% Students per teacher Graduation Rate (using Urban Institute's Cumulative Promotion Index) no data State Test - English Language Arts Proficiency 57.0% 50.1% 86.4% 72.1% 76.3% 68.3% State Test - Math Proficiency 58.6% 58.3% 87.1% 68.1% 70.8% 65.5% Instructional expenditures per student $10,200 $16,150 $11,593 $6,987 $12,326 $8,309 Did this district make Adequate Yearly Progress in 2008? 26 NO NO YES NO NO NO RaMP Up Target; i.e., How much progress must the district make per year to reach 100% proficiency by 2014? % 7.1% 2.2% 5.0% 4.4% 5.0% Benchmarking South Bend 106

111 Table 19: Research and Development South Bend and Indiana Benchmark Metropolitan Areas South Bend 1 University of Notre Dame Indiana Benchmark Metropolitan Areas Evansville 2 Fort Wayne 3 Indianapolis 4 IU-PU Indianapolis Indiana Total U.S. Total University Technology Transfer Indicators 28 Technology Transfer Office FTE n/a n/a n/a n/a n/a Research expenditures-2007 $83,000,000 n/a n/a n/a n/a n/a Licenses & options executed n/a n/a n/a n/a n/a Cumulative active licenses n/a n/a n/a n/a n/a Startups n/a n/a n/a n/a n/a Invention Disclosures n/a n/a n/a n/a n/a Patents issued n/a n/a n/a n/a n/a New patent applications n/a n/a n/a n/a n/a License income-2007 $84,059 n/a n/a n/a n/a n/a Indiana Benchmark MSAs South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Other R & D Output Indicators Patents Per 10,000 employees Patenting Growth % -0.45% 0.28% -3.15% -2.13% -0.30% Traded Industry Establishments Growth % 0.98% 1.60% 2.82% 1.69% 2.11% Benchmarking South Bend 107

112 Table 20: Research and Development South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 University of Notre Dame Rensselear Polytechnic Institute SUNY at Albany a University of Michigan University of Kentucky b University of Wisconsin c Wichita State University University Technology Transfer Indicators 28 Technology Transfer Office FTE no data Research expenditures-2007 $83,000,000 $65,958,870 $781,857,438 $822,967,675 $190,973,672 $1,028,000,000 no data Licenses & options executed no data Cumulative active licenses no data Startups no data Invention Disclosures no data Patents issued no data New patent applications no data License income-2007 $84,059 $1,295,154 $34,464,000 $12,795,739 $1,802,905 $46,700,000 no data National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Other R & D Output Indicators Patents Per 10,000 employees Patenting Growth % 1.51% 0.64% 5.00% -1.28% -1.98% -0.30% Traded Industry Establishments Growth % 2.97% 0.97% 2.45% 2.51% 1.39% 2.11% aresearch Foundation of SUNY buniversity of Kentucky Research Foundation cwisconsin Alumni Research Foundation Benchmarking South Bend 108

113 Table 21: Entrepreneurial Activity Indicators South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 All Indiana MSAs All U.S. MSAs Annual rate of business startups % 9.03% 10.53% 12.46% 11.02% 12.52% Annual rate of business closings % 8.45% 9.27% 10.08% 9.60% 10.57% Business Churn Rate % 17.49% 19.80% 22.54% 20.62% 23.09% Entrepreneurial Value Added (in $1,000s) Entrepreneur.com "2006 Hot Cities for Entrepreneurs" rankings 34 : Overall Entrepreneurial Activity rank 105 c 55 c 25 c 16 a n/a n/a Young Company rank 99 c 62 c 26 c 11 a n/a n/a Rapid Growth rank 114 c 60 c 23 c 18 a n/a n/a aamong 50 large cities bamong 63 midsized cities camong 162 small cities Benchmarking South Bend 109

114 Table 22: Entrepreneurial Activity Indicators South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 All U.S. MSAs Annual rate of business startups % 9.84% 10.92% 11.35% 9.73% 10.71% 12.52% Annual rate of business closings % 8.63% 10.44% 9.30% 8.57% 10.02% 10.57% Business Churn Rate % 18.47% 21.36% 20.65% 18.30% 20.73% 23.09% Entrepreneurial Value Added (in $1,000s) Entrepreneur.com "2006 Hot Cities for Entrepreneurs" rankings 34 : Overall Entrepreneurial Activity rank 105 c 46 b 29 a 35 c 6 b 24 c n/a Young Company rank 99 c 52 b 27 a 31 c 10 b 25 c n/a Rapid Growth rank 114 c 45 b 34 a 43 c 8 b 22 c n/a aamong 50 large cities bamong 63 midsized cities camong 162 small cities Benchmarking South Bend 110

115 Table 23: Innovation Index South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Innovation Index 35 Innovation Index - Overall Human Capital Human Capital Index Factors: Percentage of Population Ages 25 to 64 with Some College or an Associate's Degree, % 31.5% 33.2% 27.7% 28.1% 29.6% Percentage of Adult Population With a Bachelor's Degree or Higher, % 19.6% 23.3% 28.8% 21.4% 26.5% Average Annual Mid-Aged Population (ages 25 to 44) Growth Rate, 1997 to % -1.2% -0.7% 0.2% -0.5% -0.3% Average High Tech Employment Share, % 4.6% 4.3% 5.0% 4.0% 4.8% Technology-Based Knowledge Occupations, % 5.8% 7.1% 8.2% 6.6% 8.2% Economic Dynamics Economic Dynamics Index Factors: Average Venture Capital Investment per $10,000 GDP, $0.00 $0.00 $0.00 $16.98 $6.13 $34.77 Average Research & Development Investment per $1,000 Compensation, $0.91 $0.75 $1.77 $60.61 $24.21 $25.44 Average Rate of Change in Broadband Holding Companies, % 20.5% 22.6% 18.7% 20.5% 16.0% Average Establishment Churn, % 75.8% 77.3% 79.2% 76.4% 77.4% Average Small Establishments per 1,000 Workers, Average Large Establishments per 100,000 Workers, Benchmarking South Bend 111

116 Table 23: Innovation Index (Continued) South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Productivity and Employment Productivity and Employment Index Factors: Rate of Change in High-Tech Employment Share, % 0.0% -2.0% 0.7% 0.2% -0.7% Job Growth-to-Population Growth Ratio, Gross Domestic Product (GDP) per Worker, 2006 $63,218 $74,156 $63,676 $69,795 $64,409 $73,783 Average Rate of Change in GDP per Worker, % 3.5% 3.2% 3.7% 3.2% 3.7% Average Patents per 1,000 Workers, Economic Well-Being Economic Well-Being Index Factors: Poverty Rate, 3-Year Average, % 11.2% 10.5% 10.1% 11.1% 12.8% Unemployment Rate, 3-Year Average, % 4.8% 4.9% 4.4% 5.0% 4.8% Average Net Internal Migration Rate per 10,000 Residents, Average Annual Growth in Per Capita Personal Income, % 4.2% 2.7% 3.8% 3.5% 4.1% Compensation - Average Annual Change in Wage and Salary Earnings, 1997 to % 3.8% 2.6% 3.4% 3.1% 3.8% Compensation - Average Annual Change in Proprietor's Income, 1997 to % 6.3% 4.3% 6.3% 4.8% 3.3% Benchmarking South Bend 112

117 Table 24: Innovation Index South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 U.S. Total Innovation Index 35 Innovation Index - Overall Human Capital Human Capital Index Factors: Percentage of Population Ages 25 to 64 with Some College or an Associate's Degree, % 30.1% 27.4% 28.4% 31.1% 33.2% 29.6% Percentage of Adult Population With a Bachelor's Degree or Higher, % 32.2% 50.7% 31.9% 39.9% 26.3% 26.5% Average Annual Mid-Aged Population (ages 25 to 44) Growth Rate, 1997 to % -1.1% -0.2% 0.4% -0.2% -1.0% -0.3% Average High Tech Employment Share, % 4.9% 5.7% 5.8% 4.6% 3.1% 4.8% Technology-Based Knowledge Occupations, % 11.5% 11.4% 7.9% 11.6% 8.9% 8.2% Economic Dynamics Economic Dynamics Index Factors: Average Venture Capital Investment per $10,000 GDP, $0.00 $3.69 $53.92 $8.86 $23.68 $0.14 $34.77 Average Research & Development Investment per $1,000 Compensation, $0.91 $5.19 $2.91 $25.62 $1.20 $0.91 $25.44 Average Rate of Change in Broadband Holding Companies, % 9.7% 13.5% 21.9% 17.4% 24.1% 16.0% Average Establishment Churn, % 74.5% 79.1% 78.8% 76.9% 76.9% 77.4% Average Small Establishments per 1,000 Workers, Average Large Establishments per 100,000 Workers, Benchmarking South Bend 113

118 Productivity and Employment Table 24: Innovation Index (Continued) South Bend and National Benchmark Metropolitan Areas South Bend 1 National Benchmark Metropolitan Areas Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Productivity and Employment Index Factors: Rate of Change in High-Tech Employment Share, % 0.2% -1.2% -1.0% 3.4% 1.9% -0.7% Job Growth-to-Population Growth Ratio, Gross Domestic Product (GDP) per Worker, 2006 $63,218 $82,668 $71,069 $67,912 $66,360 $62,383 $73,783 Average Rate of Change in GDP per Worker, % 4.0% 2.9% 2.4% 3.6% 3.7% 3.7% Average Patents per 1,000 Workers, Economic Well-Being Economic Well-Being Index Factors: Poverty Rate, 3-Year Average, % 9.9% 11.3% 13.2% 9.2% 11.9% 12.8% Unemployment Rate, 3-Year Average, % 4.0% 4.6% 4.5% 3.4% 4.7% 4.8% Average Net Internal Migration Rate per 10,000 Residents, Average Annual Growth in Per Capita Personal Income, % 4.1% 2.9% 3.6% 4.4% 4.3% 4.1% Compensation - Average Annual Change in Wage and Salary Earnings, 1997 to % 3.5% 3.6% 3.6% 4.0% 3.4% 3.8% Compensation - Average Annual Change in Proprietor's Income, 1997 to % 2.4% 5.8% 2.0% 3.3% 9.2% 3.3% U.S. Total Benchmarking South Bend 114

119 Table 25: Industry Clusters Location Quotients South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Total U.S. Total Industry Cluster Employment Location Quotients in Advanced Materials Agribusiness, Food Processing & Technology Apparel & Textiles Arts, Entertainment, Recreation & Visitors Biomedical/Biotechnical (Life Sciences) Business & Financial Services Chemicals & Chemical Based Products Defense & Security Education & Knowledge Creation Energy (Fossil & Renewable) Forest & Wood Products Glass & Ceramics IT & Telecommunications Manufacturing Supercluster Computer & Electronic Product Mfg Electrical Equip., Appliance & Component Mfg Fabricated Metal Product Mfg Machinery Mfg Primary Metal Mfg Transportation Equipment Mfg Mining Printing & Publishing Transportation & Logistics Benchmarking South Bend 115

120 Table 26: Industry Clusters Percentage Growth in Number of Employees 2001 to 2008 South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Average U.S. Average Industry Cluster Percentage Growth in Number of Employees to 2008 Total All Industries -2.62% -0.14% -1.12% 5.87% 0.04% 3.99% Advanced Materials % 31.95% -8.60% -1.62% % % Agribusiness, Food Processing & Technology 10.97% 0.67% 12.70% 6.48% 2.69% -2.97% Apparel & Textiles 13.39% % 55.03% 1.20% -4.56% % Arts, Entertainment, Recreation & Visitors 24.55% % 5.82% -9.46% -3.83% 4.13% Biomedical/Biotechnical (Life Sciences) % 21.96% 22.74% 20.11% 20.24% 19.31% Business & Financial Services Cluster % % % 4.76% 2.80% 6.51% Chemicals & Chemical Based Products % -9.81% 2.43% -9.06% % % Defense & Security -2.89% 17.56% 5.27% 9.14% 5.62% 1.26% Education & Knowledge Creation 20.04% 16.92% 17.13% 33.65% 11.14% 10.08% Energy (Fossil & Renewable) % 10.23% 0.71% -2.37% -2.20% 4.30% Forest & Wood Products % % % -3.45% % % Glass & Ceramics % % 25.74% -0.74% % % Information Technology & Telecommunications % 14.90% 46.18% -4.22% % % Manufacturing Supercluster % 30.06% % % % % Computer & Electronic Product Mfg 10.39% % 16.52% -2.12% % % Electrical Equip., Appliance & Component Mfg % % % % % % Fabricated Metal Product Mfg -7.85% % 17.33% -8.20% % -8.39% Machinery Mfg % % % % % % Primary Metal Mfg % % % % % % Transportation Equipment Mfg % % % % % % Mining 0.00% 0.00% 43.36% 21.91% -6.58% 7.37% Printing & Publishing 10.30% 11.00% -4.12% -2.69% -7.46% % Transportation & Logistics 14.67% % 7.34% 5.34% 2.64% 1.88% Benchmarking South Bend 116

121 Table 27: Industry Clusters Location Quotients South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Industry Cluster Employment Location Quotients in Advanced Materials Agribusiness, Food Processing & Technology Apparel & Textiles Arts, Entertainment, Recreation & Visitors Biomedical/Biotechnical (Life Sciences) Business & Financial Services Chemicals & Chemical Based Products Defense & Security Education & Knowledge Creation Energy (Fossil & Renewable) Forest & Wood Products Glass & Ceramics IT & Telecommunications Manufacturing Supercluster Computer & Electronic Product Mfg Elect. Equip., Appliance & Component Mfg Fabricated Metal Product Mfg Machinery Mfg Primary Metal Mfg Transportation Equipment Mfg Mining Printing & Publishing Transportation & Logistics U.S. Total Benchmarking South Bend 117

122 Table 28: Industry Clusters Percentage Growth in Number of Employees 2001 to 2008 South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Industry Cluster Percentage Growth in Number of Employees to 2008 U.S. Average Total All Industries -2.62% 2.47% -4.44% 5.45% 8.11% 4.58% 3.99% Advanced Materials % 12.54% -0.36% 58.58% 51.87% 22.15% % Agribusiness, Food Processing & Technology 10.97% 1.06% -0.44% -7.17% -7.36% 49.73% -2.97% Apparel & Textiles 13.39% 0.75% % % 12.19% 15.95% % Arts, Entertainment, Recreation & Visitors 24.55% % 30.68% -1.83% 9.73% 0.37% 4.13% Biomedical/Biotechnical (Life Sciences) % 13.99% 37.81% 35.57% 43.34% 19.93% 19.31% Business & Financial Services % 11.24% % 18.00% 3.59% 2.38% 6.51% Chemicals & Chemical Based Products % 3.80% -1.03% 13.77% -9.07% % % Defense & Security -2.89% % % 26.84% -1.78% -8.62% 1.26% Education & Knowledge Creation 20.04% 65.63% 82.53% 43.95% 11.51% 10.90% 10.08% Energy (Fossil & Renewable) % 16.61% % % 11.27% 2.43% 4.30% Forest & Wood Products % % % -2.36% % % % Glass & Ceramics % % -3.14% % % 31.86% % IT & Telecommunications % 5.47% % 9.10% 34.30% 2.85% % Manufacturing Supercluster % % % % 4.14% -6.05% % Computer & Electronic Product Mfg 10.39% -0.83% % % 8.30% 33.25% % Elect. Equip., Appliance & Component Mfg % 0.00% % % 1.43% -9.26% % Fabricated Metal Product Mfg -7.85% % % -6.50% 13.06% 30.50% -8.39% Machinery Mfg % % % % 16.59% 0.47% % Primary Metal Mfg % 0.00% 0.00% 0.00% % % % Transportation Equipment Mfg % % % 61.06% % % % Mining 0.00% % % 0.00% -7.65% 0.00% 7.37% Printing & Publishing 10.30% % % % 30.12% % % Transportation & Logistics 14.67% 16.63% -2.24% 9.21% -9.93% -1.18% 1.88% Benchmarking South Bend 118

123 Table 29: South Bend's Industry Clusters Employment Shift Share 2001 to 2008 South Bend 1 Number of Employees Industry Cluster Percentage Change in Employees 2001 to 2008 Shift Share South Bend U.S. Total National Industry South Bend Total All Industries 134, , % 3.99% 5, ,902 Advanced Materials 4,367 3, % % Agribusiness, Food Processing & Technology 957 1, % -2.97% Apparel & Textiles % % Arts, Entertainment, Recreation & Visitors 2,049 2, % 4.13% Biomedical/Biotechnical (Life Sciences) 3,652 3, % 19.31% ,278 Business & Financial Services Cluster 7,674 6, % 6.51% ,877 Chemicals & Chemical Based Products 3,787 3, % % Defense & Security 3,706 3, % 1.26% Education & Knowledge Creation 14,468 17, % 10.08% 577 1, Energy (Fossil & Renewable) 5,715 4, % 4.30% ,720 Forest & Wood Products 2,833 2, % % Glass & Ceramics % % Information Technology & Telecommunications 4,183 3, % % Manufacturing Supercluster 13,718 11, % % 547-2, Computer & Electronic Product Mfg % % Electrical Equip., Appliance & Component Mfg % % Fabricated Metal Product Mfg 3,323 3, % -8.39% Machinery Mfg 1,418 1, % % Primary Metal Mfg 2,187 1, % % Transportation Equipment Mfg 5,732 5, % % Mining % 7.37% Printing & Publishing 1,942 2, % % Transportation & Logistics 2,741 3, % 1.88% Benchmarking South Bend 119

124 Table 30: Occupation Cluster Location Quotients South Bend and Indiana Benchmark Metropolitan Areas South Bend 1 Indiana Benchmark Metropolitan Areas Evansville 2 Fort Wayne 3 Indianapolis 4 Occupation Cluster Employment Location Quotients Managerial, Sales, Marketing & HR Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers Health Care & Medical Science (Aggregate) Health Care & Medical Science (Medical Practitioners and Scientists) Health Care & Medical Science (Medical Technicians) Health Care & Medical Science (Therapy, Counseling & Rehabilitation) Mathematics, Statistics, Data & Accounting Legal & Financial Services & Real Estate Information Technology Natural Sciences & Environmental Mgmt Crop & Livestock Workers Primary/Secondary & Vocational Education, Remediation & Social Services Building, Landscape & Construction Design Engineering & Related Sciences Personal Services Occupations Arts, Entertainment, Publishing & Broadcasting Public Safety & Domestic Security Postsecondary Education & Knowledge Creation Job Zone Job Zone Technology-Based Knowledge Clusters Indiana Total U.S. Total Benchmarking South Bend 120

125 Table 31: Occupation Clusters Percentage Growth In Number Of Employees South Bend and Indiana Benchmark Metropolitan Areas Indiana Benchmark Metropolitan Areas South Bend 1 Evansville 2 Fort Wayne 3 Indianapolis 4 Indiana Average U.S. Average Occupation Cluster Percentage Change in Number of Employees Managerial, Sales, Marketing & HR 4.23% 2.66% 3.27% 8.38% 6.58% 9.57% Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers -1.21% 3.54% 2.08% 6.36% 2.40% 7.87% Health Care & Medical Science (Aggregate) 6.41% 13.90% 20.58% 13.27% 12.48% 13.29% Health Care & Medical Science (Medical Practitioners and Scientists) 5.47% 8.76% 13.50% 8.58% 8.29% 10.77% Health Care & Medical Science (Medical Technicians) 11.53% 14.27% 15.43% 15.20% 13.86% 14.84% Health Care & Medical Science (Therapy, Counseling & Rehabilitation) 4.65% 15.62% 25.79% 14.34% 13.48% 13.79% Mathematics, Statistics, Data & Accounting 0.93% -1.81% -2.77% 3.97% 2.08% 3.96% Legal & Financial Services & Real Estate 6.96% 0.59% 1.55% 10.57% 8.01% 12.75% Information Technology 2.75% 6.03% 3.43% 8.47% 5.61% 2.20% Natural Sciences & Environmental Mgmt 4.75% 5.87% -8.90% 7.92% 5.76% 8.79% Crop & Livestock Workers 3.63% 0.06% -1.27% 3.13% -1.91% 0.88% Primary/Secondary & Vocational Education, Remediation & Social Services 7.60% 5.24% 9.24% 12.34% 7.67% 10.08% Building, Landscape & Construction Design -0.64% 11.04% % 11.07% 5.49% 7.71% Engineering & Related Sciences -2.66% 3.70% -3.74% 4.58% -0.81% -0.85% Personal Services Occupations -2.10% 1.92% -6.93% 7.22% 3.38% 14.30% Arts, Entertainment, Publishing & Broadcasting 10.40% 7.85% 9.29% 11.12% 9.07% 10.00% Public Safety & Domestic Security 12.95% 8.80% 24.58% 7.82% 7.65% 9.38% Postsecondary Education & Knowledge Creation 28.85% 8.84% 20.40% 15.85% 13.52% 15.65% Job Zone % 0.76% 0.07% 4.54% 1.70% 6.18% Job Zone % -0.66% 2.07% 6.60% 3.08% 6.55% Technology-Based Knowledge Clusters % 4.30% 3.35% 7.52% 5.52% 5.71% Benchmarking South Bend 121

126 Table 32: Occupation Cluster Location Quotients South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Occupation Cluster Employment Location Quotients Managerial, Sales, Marketing & HR Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers Health Care & Medical Science (Aggregate) Health Care & Medical Science (Medical Practitioners and Scientists) Health Care & Medical Science (Medical Technicians) Health Care & Medical Science (Therapy, Counseling & Rehabilitation) Mathematics, Statistics, Data & Accounting Legal & Financial Services & Real Estate Information Technology Natural Sciences & Environmental Mgmt Crop & Livestock Workers Primary/Secondary & Vocational Education, Remediation & Social Services Building, Landscape & Construction Design Engineering & Related Sciences Personal Services Occupations Arts, Entertainment, Publishing & Broadcasting Public Safety & Domestic Security Postsecondary Education & Knowledge Creation Job Zone Job Zone Technology-Based Knowledge Clusters U.S. Total Benchmarking South Bend 122

127 Table 33: Occupation Clusters Percentage Growth In Number Of Employees South Bend and National Benchmark Metropolitan Areas National Benchmark Metropolitan Areas South Bend 1 Albany 5 Ann Arbor 6 Lexington 7 Madison 8 Wichita 9 Occupation Cluster Percentage Change in Number of Employees Managerial, Sales, Marketing & HR 4.23% 5.25% 7.46% 9.55% 14.59% 2.45% 9.57% Skilled Production Workers: Technicians, Operators, Trades, Installers & Repairers -1.21% 3.22% % 2.33% 11.65% 2.27% 7.87% Health Care & Medical Science (Aggregate) 6.41% 3.89% 6.93% 12.25% 12.74% 9.49% 13.29% Health Care & Medical Science (Medical Practitioners and Scientists) 5.47% 6.73% 10.91% 11.54% 10.73% 7.76% 10.77% Health Care & Medical Science (Medical Technicians) 11.53% 7.14% 9.97% 11.54% 14.98% 9.74% 14.84% Health Care & Medical Science (Therapy, Counseling & Rehabilitation) 4.65% 2.02% 4.29% 12.80% 13.06% 10.10% 13.79% Mathematics, Statistics, Data & Accounting 0.93% 1.48% -6.68% 4.59% 10.79% -5.61% 3.96% Legal & Financial Services & Real Estate 6.96% 8.33% 5.22% 13.93% 14.86% 4.74% 12.75% Information Technology 2.75% 7.12% % 1.93% 21.92% -1.46% 2.20% Natural Sciences & Environmental Mgmt 4.75% 2.75% 5.37% 9.43% 11.25% -0.25% 8.79% Crop & Livestock Workers 3.63% 3.38% 4.66% 4.58% 4.17% 3.65% 0.88% Primary/Secondary & Vocational Education, Remediation & Social Services 7.60% 6.90% 7.69% 9.52% 10.94% 13.41% 10.08% Building, Landscape & Construction Design -0.64% 2.80% -8.94% 0.77% 11.12% 1.90% 7.71% Engineering & Related Sciences -2.66% 0.87% -4.17% 7.53% 14.86% -5.61% -0.85% Personal Services Occupations -2.10% 13.79% 27.62% 14.45% 16.21% 15.00% 14.30% Arts, Entertainment, Publishing & Broadcasting 10.40% 8.47% 9.16% 10.33% 18.32% 6.60% 10.00% Public Safety & Domestic Security 12.95% 6.72% 7.10% 12.23% 11.48% 8.88% 9.38% Postsecondary Education & Knowledge Creation 28.85% 7.84% 10.80% 19.50% 17.68% 19.48% 15.65% Job Zone % 2.99% -1.76% 6.02% 7.74% 4.54% 6.18% Job Zone % 3.84% -1.48% 5.19% 8.78% 5.50% 6.55% Technology-Based Knowledge Clusters % 4.57% -0.22% 8.01% 15.20% -0.02% 5.71% U.S. Total Benchmarking South Bend 123

128 APPENDIX B ENDNOTES TO DATA TABLES Benchmarking South Bend 124

129 Appendix B: Endnotes to Tables 1South Bend: South Bend-Mishawaka, IN MSA, which includes St. Joseph County, IN; Cass County, MI 2Evansville: Evansville, IN MSA, which includes: Gibson County, IN; Posey County, IN; Vanderburgh County, IN; Warrick County, IN; Henderson County, KY; Webster County, KY 3Fort Wayne: Fort Wayne, IN MSA, which includes: Allen County, IN; Wells County, IN; Whitley County, IN 4Indianapolis: Indianapolis-Carmel, IN MSA, which includes: Boone County, IN; Brown County, IN; Hamilton County, IN; Hancock County, IN; Hendricks County, IN; Johnson County, IN; Marion County, IN; Morgan County, IN; Putnam County, IN; Shelby County, IN 5Albany: Albany-Schenectady-Troy, NY MSA, which includes: Albany County, NY; Rensselaer County, NY; Saratoga County, NY; Schenectady County, NY; Schoharie County, NY 6Ann Arbor: Ann Arbor, MI MSA, which includes: Washtenaw County, MI 7Lexington: Lexington-Fayette, KY MSA, which includes: Bourbon County, KY; Clark County, KY; Fayette County, KY; Jessamine County, KY; Scott County, KY; Woodford County, KY 8Madison: Madison, WI MSA, which includes: Columbia County, WI; Dane County, WI; Iowa County, WI 9Wichita: Wichita, KS MSA, which includes: Butler County, KS; Harvey County, KS; Sedgwick County, KS; Sumner County, KS 10Forbes.com: Best Places For Business And Careers 2009 ( 11Source: U.S. Census Bureau, American Community Survey 12Source: U.S. Census Bureau, 2008 American Community Survey 13Net Migration of Young, Single, College-Educated: The "young" are those who were aged 25 to 39 in 2000; the "single" are those who were never married, or were widowed or divorced in 2000; and the "college educated" are those who had at least a bachelor's degree in "Net migration" is based on an approximated 1995 population, which is the sum of young, single, and college educated people who reported living in the area in both 1995 and 2000, and those who reported living in that area in 1995 but lived elsewhere in "Net migration rate" is the 1995-to-2000 net migration, divided by the approximated 1995 population. The net migration rate is a percentage computed by dividing the 1995-to-2000 net migration by the approximated 1995 population. 14Weighted Workforce Education Index: A measure devised by Kauffman Foundation as part of its "New Economy Index". The measure is computed by (a) weighting the percentage of residents with less than a high school education with a multiplier of -0.5, (b) weighting the percentage of residents with a high school diploma or equivalent with a multiplier of 0.0, (c) weighting the percentage of residents with some college (at least a year) but no degree were with a multiplier of 0.25, (d) weighting the percentage of residents with an associate's degree with a multiplier of 0.5, (c) weighting the percentage of residents with a bachelor s degree with a multiplier of 1.0, (e) weighting the percentage of residents with master s and professional degrees with a multiplier of 1.5, (f) weighting the percentage of residents with doctorate degrees with a multiplier of 2.0, and (g) totaling the weighted percentages to produce the Weighted Workforce Education Index value. Source: Computed using data from U.S. Census, 2008 American Community Survey Table C ( 15Talent Index: A measure of the human capital in the MSA based on the fraction of all people age 25 or older with a Bachelor's Degree or above who live in the MSA divided by the fraction of the total U.S. population age 25 or older living in that MSA. The resulting number is a ratio: a value over 1.0 indicates that an MSA has a greater-than-average share of such people, while a value below 1.0 indicates that an MSA has a lower-than-average share of such people. Source: Computed using data from U.S. Census, 2008 American Community Survey Table C Source: Indiana University Kelley School of Business, STATS Indiana ( 17Source: National Science Foundation, Employment and earnings in S&E occupations and non-s&e occupations, by metropolitan area-may Science and Engineering Workforce Index: A measure of the Science and Engineering talent in the MSA based on the fraction of the total workforce in the MSA employed in science and engineering occupations divided by the fraction of the total U.S. workforce employed in that MSA. The resulting number is a ratio: a value over 1.0 indicates that an MSA has a greater-than-average share of the workforce employed in science and engineering occupations, while a value below 1.0 indicates that an MSA has a lower-than-average share of the workforce employed in science and engineering occupations. Source: Computed using data from National Science Foundation, Employment and earnings in S&E occupations and non- S&E occupations, by metropolitan area-may 2006 ( Benchmarking South Bend 125

130 Appendix B: Endnotes to Tables (Continued) 19Bohemian Index: The fraction of all "Bohemians" (i.e., authors, designers, musicians and composers, actors and directors, craft-artists, painters, sculptors, artist printmakers, photographers, dancers, and artists, performers and related workers) who live in the MSA divided by the fraction of the total U.S. population living in that MSA. The resulting number is a ratio: a value over 1.0 indicates that an MSA has a greater-than-average share of Bohemians, while a value below 1.0 indicates that Bohemians are under-represented. Source: computed using data from USDA Economic Research Service ( 20Creative Class Index: The fraction of all "Creative Class" people (i.e., people employed in computer and mathematical occupations; architecture and engineering; life, physical, and social science occupations; education, training, and library occupations; arts, design, entertainment, sports, and media occupations; management occupations; business and financial operations; legal occupations; healthcare practitioners and technical occupations; and high-end sales and sales management) who live in the MSA divided by the fraction of the total U.S. population living in that MSA. The resulting number is a ratio: a value over 1.0 indicates that an MSA has a greater-than-average share of Creative Class people, while a value below 1.0 indicates that the Creative Class is under-represented. Source: computed using data from USDA Economic Research Service ( 21Source: Indiana University Kelley School of Business, STATS Indiana ( 22Median Family Income is the total income of a family, where "family" includes a householder and one or more people living in the same housing unit who are related to the householder by birth, marriage, or adoption. All people in a household who are related to the householder are regarded as members of his or her family. Median Household Income is the total income of all people who occupy a housing unit as their usual place of residence, whether or not they are related. Source: U.S. Census Bureau, American Community Survey. 23Source: Council of Chief State School Officers SchoolDataDirect ( 24Students with Special Needs Index A measure of the concentration of students with one of three key special needs within a school district or state: students that are economically disadvantaged, students with disabilities, and English language learners. The Students with Special Needs Index provides a picture of cumulative student need and facilitates the identification of exceptional student performance among schools or school districts with a given level of "challenge." An Analysis of districts nationwide indicated that the maximum values observed in K-12 districts for each type of student with special circumstances, after discarding clear outliers, were the following: Economically Disadvantaged Students = 100% Students with Disabilities = 50% English Language Learners = 50% Total Cumulative Maximum (for a state reporting all three indicators) = 200% This is not to say that there are not school districts that exceed these values, but national analysis indicates that they are extreme outliers. The index tracks cumulative needs due to the fact that individual students may have multiple special needs. Formula: The cumulative sum of the percentages of students that have any of the three special needs, divided by the cumulative sum of the maximum values observed nationally for these three need categories, multiplied by Cumulative Promotion Index: An index created by the Urban Institute to estimate graduation rates. This method assumes that graduation is a process composed of three grade-to-grade promotion transitions (9 to 10, 10 to 11, and 11 to 12), in addition to the graduation event (grade 12 to diploma). Each of the transitions is calculated as a probability by dividing the enrollment of the later year by the enrollment of the previous year. For example, the grade 9 to grade 10 promotion would be calculated by dividing grade 10 enrollment in one year by grade 9 enrollment from the previous year. These separate probabilities are then multiplied to produce the probability that a student in the school system will graduate. This measure counts only students receiving regular high school diplomas as graduates and the data represent estimated grade-level cohorts rather than true cohorts of individual students. By multiplying grade-specific promotion ratios together, the Cumulative Promotion Index (CPI) estimates the likelihood that a ninth grader from a particular school system will complete high school with a regular diploma in four years given the conditions prevailing in that school system during that school year. 26AYP Status: The determination of whether or not a student subgroup, school, or school district met the performance goals, or AYP targets, established by the state and federal government in accordance with the No Child Left Behind Act. AYP targets have been set for state test proficiency and participation, as well as for other academic indicators such as attendance and graduation rates. Should a school or school district fail to meet the AYP target for state test proficiency, AYP can still be achieved through Safe Harbor. 27RaMP Up Target (% pts): The average yearly gain in proficiency rates that a district must make in order to reach 100% proficiency in reading and math combined by The RaMP Up Target serves as a complement to the Adequate Yearly Progress (AYP) target schedules set by the states by identifying the average annual gains that a school, district, or state must make to reach the goal of 100% proficiency. The RaMP Up Target is intended to provide decision-makers with a springboard for discussions about how to ensure schools and districts are moving toward 100% proficiency by Values will range from 0 for schools or school districts that have already reached 100% proficiency, to a maximum of 10 (in 2004) for schools or school districts that have no students that demonstrate proficiency in reading or math. The RaMP Up Target is calculated by dividing the percentage of students that have not attained proficiency by the number of years until Benchmarking South Bend 126

131 Appendix B: Endnotes to Tables (Continued) 28Source: Association of University Technology Managers U.S. Licensing Survey 2007 ( 29Source: Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School ( 30Traded Industries: Industries that sell products and services across economic areas. Traded Industries are concentrated in the specific regions where they choose to locate production because of the competitive advantages afforded by these locations. 31Source: Computed from U.S. Census Bureau Company Statistics-Establishment Births & Deaths ( 32Business Churn: The sum of business startups and closings as a percentage of all businesses. A high churn rate correlates with high economic growth, job creation, and innovation. Computed from U.S. Census Bureau Company Statistics-Establishment Births & Deaths ( 33Entreprenurial Value Added: The average amount of money placed into circulation, through their business activity, by individual entrepreneurs (i.e., companies that have no employees other than the individual). Computed as total receipts/total number of establishments. "Value Added" means that the money continues to circulate locally instead of being siphoned to activities outside the MSA. A large Entrepreneurial Value Added suggests that other entrepreneurs will take advantage of startup funds and, in turn, increase the amount of capital in circulation. Computed from data at U.S. Census Bureau Nonemployer Statistics ( 34Source: Entrepreneur.com "2006 Hot Cities for Entrepreneurs" ( 35The Innovation Index is the work product of a research partnership between the Purdue Center for Regional Development, the Indiana Business Research Center at Indiana University's Kelley School of Business, Strategic Development Group, Inc., the Rural Policy Research Institute, and Economic Modeling Specialists, Inc. The Innovation Index compares regional performance to the United States and is calculated from four sub-indices. The weights for each component are listed below. (An additional "State Context" sub-index is displayed as part of the data output, but it is for reference only and not included in the calculation of the overall index.) Human Capital: 30% Economic Dynamics: 30% Productivity and Employment: 30% Economic Well-Being: 10% Further explanation of the Innovation Index methodology and the data tool is accessible at Also, Innovation Index Definitions, Calculations and Models are set forth in detail beginning on page 195 of the report "Crossing the Next Regional Frontier: Information and Analytics Linking Regional Competitiveness to Investment in a Knowledge-Based Economy", which may be viewed online or downloaded in a PDF file from 36Sources: U.S. Bureau of Labor Statistics, Quarterly Census of Employment & Wages (QCEW) and Purdue Center for Regional Development (cluster definitions). 37Job Zone 1 and Job Zone 2. The Bureau of Labor Statistics classifies civilian occupations into a series of five "job zones." Those categories are defined on the basis of the preparation such work typically requires along three dimensions - education, experience, and training. The lowest levels, Job Zones 1 and 2, are filled by occupations that call for a high school diploma or less, and little training or experience. Zone 3 jobs usually require substantial vocational training, workrelated experience, or formal education beyond high school, although not necessarily a postsecondary degree. A four-year college degree is typically the minimum requirement for entry into Zone 4 and Zone 5 occupations. 38Technology-Based Knowledge Clusters: The Purdue Center for Regional Development has defined a group of Occupation Clusters as "Technology-Based Knowledge Clusters" which include the following: Information Technology Engineering Health Care and Medical Science (Medical Practitioners and Scientists) Mathematics, Statistics, Data and Accounting Natural Sciences and Environmental Management Postsecondary Education and Knowledge Creation 39Source: Computed using data from Economic Modeling Specialists, Inc. Complete Employment Statistics Benchmarking South Bend 127

132 APPENDIX C MICHIANA TECHCONNECTION TECHNOLOGY PLATFORM DESCRIPTIONS Benchmarking South Bend 128

133 Cancer Prognosis Overview Cancer prognosis at Notre Dame has taken on a new form through gene expression analyses. By identifying patterns of gene expression that determine which patients can safely forego chemotherapy, researchers have developed a precise diagnostic tests which may save many breast cancer patients from the toxic side effects of treatment. These microarray tests measures MRNA as an indicator of whether or not the cancer growth is estrogen-driven. Estrogen-receptor positive (ER+) breast cancer patients whose tumors negatively express three genes, as assessed with Affymetrix GeneChip technology, have high long-term survival probability, transforming chemotherapy into a treatment platform of questionable benefit. Commercial Applications There are approximately 80,000 potential patients each year who might be eligible to use this test, which bases prognosis decisions on select genes rather than the whole gene set. The test is applicable to lymph node positive as well as lymph node negative diagnosis, thereby doubling its potential commercial vitality. Market Potential This gene expression test has great promise in the field of cancer prognosis, making it a technology platform of interest to many oncology/clinical marketplace. Principal Investigator Dr. Steven Buechler Benchmarking South Bend 129

134 Cancer Tissue Vaccines Overview Cancer tissue vaccines are vaccines produced from material directly harvested from tumor tissue. Because of this direct harvest approach, they include pathogen-fighting antigens that may be expressed only in vivo and which are critical to a successful response against the cancer. Researchers at ND s Freimann Life Science Center are exploring two different approaches to cancer tissue vaccines: using tumor tissue harvested from animals, and using human tumor tissue grown and expanded in immunodeficient animals. The concept has been proven in several cancer animal models. Commercial Applications This cancer vaccine technology has tremendous commercial viability, with two business concepts currently being investigated. The first is to produce an off-the-shelf line of cancer vaccines for the treatment of common cancers, such as prostrate, breast, ovarian, pancreatic, lung, and colon cancer. The second commercial case would be the establishment of a patient-specific, custommade cancer vaccine production entity that would receive patient samples from worldwide sources. This commercialization approach is possible through the latter method of vaccine tissue production (human tumor tissue amplified in animal hosts). Market Potential The market potential for tissue vaccine technology is enormous, ranging from infectious disease vaccines to cancer vaccines. The technology maintains a competitive advantage over existing vaccine generation methods, which are typically derived in clonal cell populations, because of its effective vaccination against antigen targets present only in actual tumors. Principal Investigator Mark Suckow Benchmarking South Bend 130

135 Gelatinase Inhibitors Overview Gelatinase Inhibitors are therapeutic compounds thought to alleviate the effects of strokes and other neurodegenerative diseases. In investigating the role of a certain class of enzymes called gelatinases in disease processes, ND researchers have discovered that the inhibition of such enzymatic activity shows great promise in preventing cell injury and death. After targeting two specific gelatinase strains, these researchers developed several compounds, one called SB-3CT, to selectively inhibit the enzyme effect and thereby prevent further damage to cells especially brain cells after suffering a stroke. Commercial Applications Gelatinase Inhibition is a breakthrough research area that will have significant impact in the field of disease treatment. The particular set of inhibitors developed has broad treatment applicability, including traumatic brain injuries, aneurysms, diabetes, wound healing, and asthma. Gelatinase inhibitors have great potential to become a versatile and complementary treatment platform for a great number of degenerative diseases. Market Potential The discovery and development of gelatinase inhibitors for disease treatment represents a new drug-production opportunity for the biopharmaceutical market. Principal Investigators Shahriar Mobashery and Mayland Chang Benchmarking South Bend 131

136 Extreme Series Hybrid Overview Extreme Series Hybrid is an enhanced vehicle propulsion system. This concept optimizes fuel use in hybrid electric powertrain systems via the utilization of ultracapacitors (instead of batteries) and the development of sophisticated algorithms to control engine behavior for energy generation. By running the engine at the optimal point versus over suboptimal conditions, the Extreme Series Hybrid guarantees both high performance efficiency and environmental soundness. Commercial Applications The Extreme Series Hybrid has the potential to be a "better" electric vehicle system. The use of ultracapacitors as the sole energy buffer as opposed to Lithium based batteries, with the motor running over a specific optimal range versus a wide operating range, ensures fuel efficiency. Potential commercial opportunities are expansive, for many forms of transportation. Market Potential Once the prototype has been developed, the Extreme Series Hybrid offers great potential for the fuel-efficient transportation industry. Principal Investigator Peter Bauer Benchmarking South Bend 132

137 Electronic Flow Shaping Overview The Center for Flow Physics and Control (FlowPAC) at the University of Notre Dame has upheld a longtime tradition of exemplary research in the field of fluid dynamics and aerodynamics. Among the interrelated fields explored by the multi-disciplinary research teams at the Center, the topic of Electronic Flow Shaping has sparked interest from both government agencies and industry partners. The development of plasma flow actuators offers a fundamental advantage in aerodynamic shaping, which translates into opportunities for drag reduction, stall speed reduction, and weight/shape redistribution. Commercial Applications The study of plasma flow control has tremendous commercial promise for a variety of aerospace applications. The shape-changing capability of this technology has implications in jet noise control, separation control on helicopter rotors and jet engines, and instabilities control on the wings of aircraft. Apart from the aerospace market, this plasma-actuated technology involves electronic flow shaping for improved performance of ground vehicles (car/railway), turbo-machinery, wind energy, acoustics, and adaptive optics. Market Potential As stated above, the infrastructure is in place for aerospace applications, although ongoing research will be oriented towards additional marketplaces that can benefit from the flow shaping capability of this technology. Principal Investigator Thomas Corke Benchmarking South Bend 133

138 Ionic Liquids Overview One of Notre Dame Energy Center s primary research areas is CO 2 Separation, Storage, Sequestration and Use. Under this title, the development of ionic liquid technologies as a replacement for MEA monoethyl amine, the current absorber for CO 2 separation and capture presents the opportunity to create better fossil fuels. Essentially, these ionic liquids (nonvolatile low-melting salts) offer an energy-efficient alternative for selective gas separation. Commercial Applications The use of ionic liquids to permit the cleaner use of fossil fuels has several commercial applications. For large-scale uses such as in power plants that utilize MEA equipment, the substitution of ionic liquids translates into a high level of energy efficiency. A secondary category of applications is the use of ionic liquids as a substitute working fluid in relatively smaller scale areas such as refrigeration systems possibly for the RV industry or other small space cooling arenas. The ND team is also researching the use and efficacy of ionic liquids as a cleaning/scavenging agent. Market Potential The relevant markets for ionic liquids include fossil fuel research, energy plants, and the absorption cooling industry. Principal Investigator Joan Brennecke Benchmarking South Bend 134

139 Laser Spectroscopy Overview Five years in the making, this detection technology developed by two ND Physics Professors will have significant global impact when it comes to nanoparticle analysis. Their Laser Spectroscopy technology can count, size, and identify many classes of nanoparticles with a degree of sensitivity one million times stronger than the current standard held by light-based technologies. The multiwavelength laser technique not only provides an absolute count of the particles but also detects their geometries (width and length of rod-shaped objects) for proper sizing and identification. Commercial Applications This laser-based tool can be used for real-time detection of biological nanoparticles including proteins, active viruses, bacteria, and other pathogens which has significant implications in terms of medical diagnostics and the fight against global pandemics. Other commercial applications include water analysis, environmental surveying, and pharmaceutical testing. Market Potential With a broad set of commercial applications, this particle-sizing and counting technique fits into a wide range of markets, from medical research and pharmaceutical development to quality inspection and environmental testing. Principal Investigators Steven Ruggiero and Carol Tanner Benchmarking South Bend 135

140 Microfluidic Diagnostics Overview Microfluidic Diagnostics is an umbrella term referring to a number of research initiatives being undertaken at Notre Dame s Center for Microfluidics and Medical Diagnostics. Here, a top team of leading researchers and graduate students investigate the behavior, control and manipulation of fluids at a sub-millimeter scale moving around microparticles via electrokinetics. A wide bench of technologies has been developed at the Center, one that includes nanobead, nanoslot, and crystallization technologies, in addition to micropumps, micromixers and nanosprays. The development of such chip-platform biosensors holds significant benefits in terms of portable diagnostic kits, effective analytical devices, and low-cost therapeutic systems. Commercial Applications Microfluidics is a field that relates to a wide range of commercial applications. Researchers have developed technologies for bioparticle detection in water testing, environmental surveying, and health/medical diagnostics. The portability, speed, sensitivity, and selectivity of these detection and identification sensors give these technologies a competitive edge over alternative options such as heavy laboratory/pcr testing systems. Specific applications may include disease detection in blood or saliva, pathogen detection in food or water, invasive species detection, and genetic testing. Market Potential These technologies appeal to a wide range of markets, including molecular diagnostics, at-home clinical, industrial testing, environmental analysis, and biopharmaceutical manufacturing. Principal Investigator Dr. Hsueh-Chia Chang Benchmarking South Bend 136

141 Quilt Packaging Nanofabrication Overview Quilt Packaging is a novel nano-packaging method designed to maximize the efficiency of interchip communication in electronic systems, including computers and microwaves (radar, imaging, etc). Quilt Packaging introduces a proprietary alternative to current packaging options via the use of an interconnected platform that fits together through the "nodules" built on the edges of individual chips. As several chips are placed together along their edges, the mating nodules connect, thereby completing a sort of "quilt" which allows for better thermal control, higher signal bandwidth, and reduced power dissipation than competing packaging methods. Commercial Applications With a remarkably low chip-to-chip loss ratio, this novel approach to electronic packaging has significant prospects in the critical performance systems fields, including radar, automobile electronics, and advanced guidance systems. Market Potential Quilt Packaging is a simple fabrication design that allows for heterogeneous integration of interconnected chips and an overall cost reduction for systems packaging. As such, it has much to offer for customers who both buy and manufacture their own chips for critical systems. Given its competitive capacities, such a technology is especially relevant for military/aerospace applications. Principal Investigators Dr. Gary Bernstein and Jason Kulick Benchmarking South Bend 137

142 Silkworm Protein Platform Overview The Silkworm Protein initiative offers a new avenue for optimal protein production with considerable competitive advantages. Using a proprietary gene transfer system called piggybac, researchers have successfully engineered transgenic silkworms with the capacity to produce envisioned proteins of interest. The generation of silkworm-based expression platforms is a costeffective alternative to mammalian-cell technologies, with high levels of protein purification and extraction-efficiency from the silk fiber layers. Commercial Applications In terms of protein production, the Silkworm platform holds great human gene therapeutic and diagnostic potential. Envisioned target protein products include monoclonal antibodies, lysosomal storage proteins, and therapeutic enzymes. These expression systems also offer the opportunity to produce Virus Like Particles, which are antigenically similar to viruses but yet non-infectious, for vaccine production capability. Market Potential Great market potential exists for this technology, in both the domestic and international arena. Relevant industries include biopharmaceuticals, medical diagnostics, vaccination development, and glycoengineering systems. Principal Investigator Malcolm Fraser Benchmarking South Bend 138

143 Transposon Platforms Overview Transposon refers to a breakthrough initiative involving the use of transgenic mammalian models for human disease research. Through the use of the proprietary genetic transposon vector piggybac, researchers are focusing their energies on the potential to develop humanized disease models in animal systems such as rats and pigs. Commercial Applications Transgene manipulation of animals represents an exciting step in the development of human viral disease models, namely for Hepatitis C, Malaria, and Neimann Pick C. Concurrently, research efforts are also being directed towards a Mammalian Induced Pluripotent Stem Cell project, which introduces this mammalian transgenic technology as a practical and effective alternative to embryonic stem cell research. Market Potential The Transposagen project finds expansive marketplace potentiality in biopharmaceutical and medicinal research fields. Principal Investigator Malcolm Fraser Benchmarking South Bend 139

144 Viral Assembly Inhibitors Overview Currently under investigation by the Eck Institute for Global Health and the IU School of Medicine, Viral Assembly Inhibitors are compounds that inhibit the proliferation of viruses. This new class of drugs works by preventing the virus from deforming the wall of cell, which typically enables the virus to replicate itself within the living organism. These inhibitors can fight against a broad range of viruses, thus contributing to their commercial potentiality. Commercial Applications The ability of these chemical compounds to inhibit viral proliferation makes it a commercially promising research area. The foundational research undertaken thus far has demonstrated a degree of effectiveness in suppressing HIV and other virus assembly, thus establishing its marketplace applicability. Market Potential Licensing opportunities are greatest for the pharmaceutics marketplace. Principal Investigators Robert Stahelin (IU School of Medicine), Kathy Taylor, Malcolm Fraser Benchmarking South Bend 140

145 Wireless Platforms Overview Wireless Platform refers to the research undertaken at the Wireless Institute, founded within Notre Dame s College of Engineering. A distinguished educational and research center, Wireless Institute is dedicated to developing wireless communication and networking technologies, including mesh and ad hoc networks, cognitive radio, antennae technology, signal processing, and software radio. Commercial Applications Research undertaken at the Wireless Institute covers a wide range of radio technologies, which translates into a wide breadth of commercial applications. In particular, one sub-project of the Institute is RFWare, which looks to develop custom hardware and software technologies to streamline radio communications. With the development of such technologies, electronic communication devices will be able to adapt to a wireless format, allowing them to communicate even when enabled on different radio systems. This initiative translates into significant commercial opportunities, especially for public safety/military applications. Market Potential The public safety/military marketplace looks to be most promising for this type of wireless technology offering. Principal Investigators J. Nick Laneman, Ph.D. and Brian Dunn, Ph.D. Benchmarking South Bend 141