Confidential Indiana Logistics Summit Partnering in Transportation, Distribution and Logistics Indianapolis, IN October 19, 2005

Confidential Converging Forces 1.Flattening of the World 2.Productivity Gains 3.Brain Drain 4.Baby Boomer Retirements 5.Homeland Security Five converging forces…. are on target to cause a significant skilled labor shortage for Indiana.

Confidential

Engineering pipeline (full-time enrollments) –China: 3,700,000 –US: 380,000 In China, 42% of students earn undergraduate degrees in science/engineering compared to only 5% of US students The US will graduate 198,000 students in science and engineering to replace 2 million Baby Boomers in these fields scheduled to retire between 1998 and 2008 The BLS predicts more than 300,000 of the 1.3 million new IT jobs created between 1996 and 2006 will go unfilled U.S. Department of Education estimates 60% of new jobs will require skills possessed by only 20% of the current workforce 960,000 to 1.2 million Employed Hoosiers possess workplace skills below those required for successful employment in a knowledge-based economy Indiana Chamber’s Economic Vision ’05 Report Card, Indiana received a grade of “F” in the Workforce category Skilled Labor Shortage ?

Confidential Priorities and Strategy 3. Deliver Premiere Customer Service 1. Grow Hoosier Jobs and Employment 2. Grow Hoosier Personal Income Three Priorities: 3. Alignment 1. Regionalization 2. Integration 4. Innovation Four-Pronged Strategy:

Confidential The TDL Opportunity Average Indiana occupational wages in TDL industries are 10% greater than average wages across all industries TDL industries currently compose 7% of Indiana’s total employment, with projected growth above the state average 108 occupations within TDL are growing at least TWICE as fast as the state average occupational growth

Confidential General and Operations Managers$84,026 Management Analysts $66,133 First-Line Supervisors/Managers$63,693 Sales Representatives $49,815 - $64,453 Bus/Truck Mechanics and Diesel Engine Spclts$36,379 Truck Drivers, Heavy and Tractor-Trailer$36,153 AVERAGE INDIANA WAGES$33,466 The TDL Opportunity 92% will require BA+ 65% will require at least some college 30% will require at least some college Seven High-Growth, High-Wage Occupations:

Confidential Skill Level High-Wage Occupations Innovating Indiana Conceptual Skills Model: Lift every Hoosier up at least one level.

Confidential Select DWD Programs Strategic Skills Initiative Training Acceleration Grant Workplace Literacy Initiative Skills Assessment Testing (e.g., WorkKeys) WorkEthic Certificate Career and Technical Education Additional brokering of training opportunities Visit:

Confidential “The perfect storm…could best be described as the confluence of three new gaps…They are the numbers gap, the ambition gap, and the education gap…These gaps are what most threaten our standard of living.” Tom Friedman, Author The World is Flat “Today, the terms of competition revolve around a central axis: a nation’s ability to mobilize, attract, and retain human creative talent.” Richard Florida, Author The Flight of the Creative Class Closing Thoughts