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Northwest Indiana’s outlook is positive as businesses change the way they operate to be more nimble, strategic

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Business owners have been optimistic about the direction of Northwest Indiana’s economy.

Changes have been taking place: Manufacturing operations have become leaner and more automated. E-commerce has shuttered many big-box stores. Long-standing local banks and brands have gotten acquired or shrunk their footprints.

But the local economy is still humming along. The Northwest Indiana Gross Metropolitan Product grew by $380 million, or 1.29 percent, last year to $29.88 billion a year, according to Indiana University Northwest’s School of Business and Economics.

“Small-business confidence is at an almost all-time high,” said Lorri Feldt, regional director of the Northwest Indiana Small Business Development Center.

“I know that not everyone feels that way, but small-business owners appreciate less regulation and the tax cuts. So we see a lot of businesses that are working on expansions, and that’s good for the overall Region.”

Small manufacturers in leased spaces are considering purchasing buildings. Larger factories also are growing — Albanese Candy Factory, in Hobart, for instance, is doubling its production space and will employ up to 1,000 workers, Feldt said.

“All across the spectrum, from little tiny one-person businesses on up, we see business owners feeling more comfortable enough to take a risk and grow their business and create jobs,” she said.

Groups like the Northwest Indiana Forum and One Region have been working to grow Northwest Indiana. Last year, the NWI Forum lured 17 companies that pledged to create 1,493 jobs and invest $661 million in the Region, and is working on a five-year marketing plan and a new "welcome to the middle of everywhere" marketing campaign.

"We're extremely excited about the future of Northwest Indiana," Northwest Indiana Forum President and Chief Executive Officer Heather Ennis said. "We're working on a regional economic plan to help us craft a stronger vision and dial in those industries we should and could be going after, as well as the skills the workforce needs. "

One Region has been working to speed up the South Shore Line to Michigan City and expand the commuter rail system to position Northwest Indiana as more of a bedroom community to Chicago, to lure young families and reverse years of population decline.

"I'm focused on the investments and game changers it would take to drive people to live here — growing population and attracting and retaining talent," One Region President and CEO Leah Konrady said.

"Over the last year, One Region focused on civic engagement around projects that would attract people to live in NWI, such as the South Shore Rail Line's projects and transit development. One Region also led an effort to learn from other regions in the country that have a turnaround story in attracting and retaining young professionals. One Region is collaboratively building our region's future by implementing what we learn from other regions and building momentum to foster investments."

Northwest Indiana's business climate is evolving and growing, Purdue University Northwest clinical assistant professor of finance and economic development Anthony Sindone said.

“There’s been a lot of interest in Northwest Indiana, including from the outside,” he said. “We’re seeing growth in the healthcare industry. We’re seeing some growth in manufacturing. It’s not dynamic, but we’re growing.”

Northwest Indiana does have a strong economic foundation, Sindone said.

“We are a manufacturing region,” he said. “We’re not going to be the next Silicon Valley. We do have a lot of pressures, but I see a lot of potential right here in Northwest Indiana.”

Keith Kirkpatrick, president of KPM Group, a project management consulting business, said people were often misguidedly pessimistic about the Region’s business climate.

“I think we ought to be optimistic about our business climate,” he said.

“Every place has challenges. We have challenges, but if we think we’ll do well, we’ll do well. I think there’s a lot of good things going on in our economy. If there’s one piece of advice I’d have for businesses in the future, it’s looking at how we fit into the global marketplace.”

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Northwest Indiana is home to many international businesses such as BP, ArcelorMittal, MonoSol and Fronius.

“We are a significant global player next to a world-class city that’s also a global player,” Kirkpatrick said. “But I think people underestimate the potential of what we have here.”

Anyone who manufactures anything in Northwest Indiana have the potential to export goods abroad, Kirkpatrick said. Environmental service groups that have helped clean up Northwest Indiana over the last few decades, for instance, also could lend their expertise to countries facing similar pollution problems, such as China and Vietnam.

“Other parts of the world face those same challenges,” he said. “We can take that knowledge and share it. I think there’s great opportunity.”

Northwest Indiana World Trade Alliance Executive Vice President Dennis Hodges said Northwest Indiana has been maturing a lot, but that there’s room for more progress.

“Over the past couple years I’ve seen maturity in all areas of all business,” he said.

“I think we’re finally on a roll. I would love to see us get our own television station. Elkhart has one, even though it’s served by the South Bend market. We could have one even though we’re served by the Chicago market.”

Unemployment is low, Hodges said. Outside investors have become more interested in the area.

“With a new attitude toward how to conduct business internationally, Northwest Indiana is on its way,” he said.

Businesses across the Region have been changing the way they do business because of increased competition, including from abroad.

ArcelorMittal shuttered blast furnaces and many finishing lines at its Indiana Harbor steel mills in the last few years, to boost capacity and make operations there more efficient and profitable.

U.S. Steel has been slashing expenses through its Carnegie Way program.

Lee Enterprises made Munster a design hub, where professional graphic designers prepare pages for newspapers all over the country.

Tri-State Automation in Hammond invested $2.5 million in an expansion so it can make manufacturing robots for factories across the Midwest looking to automate more of their production.

Cities across the Region are realizing the importance of branding and marketing and more effectively marketing themselves to bring in visitors, Feldt said.

There’s been a change in the retail marketplace since more people are shopping online and some are gravitating more toward boutiques than big-box stores, she said.

“It doesn’t mean there’s not a place for brick-and-mortar retail,” Feldt said. “But brick-and-mortar retail needs to get a lot smarter and a lot more competitive.”

Consumers can now find commodity products online at places like Amazon and Jet, so stores need to step up their game, Feldt said.

“It’s consumer,” she said. “When they venture into the physical store, they want an experience. They want something interesting and unique. Therefore smaller and local retailers are able to provide that, something different from a chain."

Businesses also have had to adapt to rapid advances in technology that have had far-reaching changes, not just how customers shop.

“Small businesses and large are grappling with how technology may change the competitive landscape for them,” she said.

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.

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