Carrier deal: One time thing, or a blueprint for the future?

INDIANAPOLIS, Ind-- As the Trump/Pence administration, Carrier, and more than 1,000 employees celebrate what’s being hailed as a victory, one of the top minds at the Kelley School of Business is making a different observation.

"This is a spot solution for one company,  one set of employees for one place and time,” Dr. Mohan Tatikonda said.

Tatikonda says it’s true this deal is a victory, but it’s just one battle victory in long war-- a war which requires long-term solutions.

"There is nothing in this solution that gets at the underlying causes of manufacturing job loss," he said.

More than 1,000 jobs will be saved at Carrier, but close to 1,000 jobs will be also be lost.

The loss of jobs is part of a larger trend. According to the U.S. Bureau of Labor Statistics, Indiana has lost nearly 150,000 manufacturing jobs since 2000.

Not everyone agrees with Dr. Tatikonda, however.

Others like site selector John Boyd say the carrier deal "may" be a glimpse at the future, especially in what’s expected to be a "pro-business" Trump administration.

"There is already a trend for re-shoring due to rising costs in China and Mexico," said Boyd.

Both men agree that for now it may be waiting game, not just for manufacturers, but perhaps for any big business looking for a better deal.

"How he will replicate this; scales this up as a policy and strategy, if at all, remains to be seen,” Tatikonda said.

Tatikonda says companies can also help save American jobs and be profitable by focusing more on innovation, rather than chasing lower production costs. Unfortunately, chasing lower costs is easier and less risky, so that likely won’t happen on a large scale.