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The industrialization of Indiana that began in the Civil War era was spurred by technological advances in processing agricultural products, manufacturing farm equipment, and improving transportation facilities. Meat-packing plants, textile mills, furniture factories, and wagon works—including Studebaker wagons—were soon followed by metal foundries, machine shops, farm implement plants, and a myriad of other durable-goods plants.

New industries included a pharmaceutical house started in Indianapolis in 1876 by a druggist named Eli Lilly, and several automobile-manufacturing shops established in South Bend and other cities by 1900. In 1906, the US Steel Co. laid out the new town of Gary for steelworkers and their families.

In 1997, the estimated total value of shipments by manufacturers in Indiana was $143 billion. Indiana is a leading producer of compact disks, elevators, recreational vehicles, mobile homes, refrigerators and freezers, storage batteries, small motors and generators, mobile homes, household furniture, burial caskets, and musical instruments. Most manufacturing plants are located in and around Indianapolis and in the Calumet region. As of 1997, there were six Fortune 500 companies headquartered in Indiana.

Earnings of persons employed in Indiana increased from $99,781,241,000 in 1997 to $106,049,254,000 in 1998, an increase of 6.3%. The largest industries in 1998 were durable goods manufacturing, 22.3% of earnings; services, 21.6%; and state and local government, 9.9%. Of the industries that accounted for at least 5% of earnings in 1998, the slowest growing from 1997 to 1998 was state and local government, which increased 2.7%; the fastest was finance, insurance, and real estate (5.8% of earnings in 1998), which increased 8.2%.