Public Policy Institute
December 07, 2012
INDIANAPOLIS - Indianapolis is known as the "Racing Capital of the World." And a new study shows the motorsports industry's impact is advancing into other manufacturing sectors throughout Indiana and across the globe.
Indiana's motorsports industry contributes more than 23,000 jobs for the state, paying an average annual wage of nearly $63,000, well above the $39,700 state average, a new report released Thursday (Dec. 6) by Purdue University shows.
At the same time, the motorsports industry is indirectly responsible for 421,000 jobs. By comparison, Indiana's life sciences industry employs 48,000 people, paying $68,000 annually, and is indirectly responsible for 225,000 jobs.
The study, titled "Race to the Future: the Statewide Impact of Motorsports in Indiana," (to read the short version, click here) was formally released in conjunction with the International Motorsports Industry Show at the Indiana Convention Center, 100 S. Capitol Ave., Indianapolis. To download a PDF of the 75-page study, go to http://www.pcrd.purdue.edu/mvp.pdf
"Indiana continues to build on its tradition as home to the Indianapolis Motor Speedway and the annual running of the Indianapolis 500 by leveraging this industry's strengths and advancing a vibrant motorsports economy," said Scott Hutcheson, assistant director of the Purdue Center for Regional Development, which led the study.
Indiana is one of the top three locations worldwide - the others are England and North Carolina - where the motorsports industry is concentrated. Importantly, Indiana's motorsports companies also are linked to other industries such as defense and aerospace, passenger vehicle manufacturing and orthopedics, according to the study.
For the study, information about motorsports companies was compiled from databases supplied by the Indiana Motorsports Association. The Indiana University Public Policy Institute also partnered on the study. Funding for the study was provided through a grant from the U.S. Economic Development Administration office in Chicago.
Tom Weisenbach, executive director of the Indiana Motorsports Association, said motorsports in Indiana is spurring innovation. Inventions and innovations in the racing industry are often transferred to other industries to solve problems. Technology used in race helmet design, for example, is helping to produce football helmets that may minimize concussions.
Motorsports touches nearly every one of Indiana's 92 counties in some way. "Beyond racetracks, there are race teams, fabricators, manufacturers, research and development firms, suppliers, marketing and public relations firms, and service providers who compose the whole of the motorsports footprint in the state," Weisenbach said.
Still, a major challenge facing efforts to transfer technology from motorsports to other industries is a relative lack of intellectual property protection, the study indicates.
"Innovation occurs so fast within motorsports that there isn't time to seek patent protection before the next variation is designed," said Drew Klacik, senior policy analyst for the Indiana University Public Policy Institute.
Another essential aspect of motorsports companies in Indiana: Their footprint extends beyond the state, said Rollie Helmling, director of Automotive and Motorsports Development for the Indiana Economic Development Corporation.
"Racing teams based in Indiana travel all over the country for races, bringing dollars back. Companies that are involved in supplying the motorsports cluster are also sending their wares around the globe with customers in more than 20 countries," Helmling said.
The challenge for Indiana and many communities is defining strategies to grow its motorsports economy. Companies in the cluster were surveyed for the study, indicating that while many expect to grow in the next five years, their growth may be threatened by several factors:
"The percentage of the entertainment dollar that goes to motorsports is shrinking," Weisenbach said. "The industry needs to diversify its income streams and should look to technology transfer and commercialization of intellectual property to generate new revenue streams."
The Purdue Center for Regional Development, which was launched in 2005, engages in applied research, policy analysis and technical assistance that addresses high-priority regional needs and policy issues. Based in Discovery Park, the center also fosters and brokers networks and partnerships and assists with strategic planning on a regional basis.