Where did they go? Industrial change and worker transitions.

• Author: Slaper, Timothy

The February 2016 announcement that Carrier Corporation was moving their operations from the west side of Indianapolis to Mexico angered affected workers, frustrated policymakers and surprised people in both Indiana and the nation. Many have wondered: What will become of those workers?

We can shed some light on what the future may hold for such dislocated manufacturing workers with a retrospective look at the recent past. We investigated the dynamics of change in Indiana manufacturing employment pre- and post-recession. The years between 2003 and 2014 were chosen and we focused on these questions:

1. As the sector shed jobs, did the displaced workers transition to markedly different industries?

2. Did they go back to school or participate in job-training programs offered by the government?

3. If so, how did those actions affect their subsequent employment in Indiana?

To identify worker transitions (and as part of the Workforce Data Quality Initiative of the U.S. Department of Labor's Employment and Training Administration), we used integrated administrative data from the Indiana Department of Workforce Development (IDWD) and the Commission for Higher Education. The resulting data set included unemployment insurance claims, quarterly industry and worker status, and degree attainment from Indiana's public colleges and universities. A cohort of workers was created for those employed in two of Indiana's most significant manufacturing industries --transportation equipment (TEM) and primary metals (PMM)--from 2001 through 2002 (eight quarters). The resulting cohort size of 174,865 was tracked from 2003 through 2014, and we followed changes in employment, industry and the pursuit of postsecondary public higher education.

Tracking transitions

Many of the original cohort workers continued to work in TEM and PMM between 2003 and 2014, while others switched to different manufacturing industries or to an industry outside the manufacturing sector. Some no longer appeared on an Indiana payroll. Due to the current limitations of these administrative data, we can only suggest that the latter found jobs in another state, stopped working altogether due to retirement or other factors, became self-employed, or perhaps even died.

Over the span of 12 years, we can quantify that, from the original cohort of workers (174,865), 33 percent were still working in TEM or PMM by 2014. Another 23 percent had transitioned to either another manufacturing industry or another...