“Manufacturers operating in states with infrastructure limitations, such as Montana, or higher operating costs, such as California, face even greater challenges when it comes to scaling,” claims Dunagan. “Success today isn't just about improving internal processes. Manufacturers also need to consider how prepared their broader regional ecosystem is to support digital transformation and automation."

Several factors were analyzed to determine the results, including: 

•    Digital infrastructure—baseline internet speeds needed to support advanced cloud ERP solutions and industrial IoT environments.

•    Workforce density—the proportion of the local population engaged in manufacturing.

•    On-the-floor technology—the actual percentage of plants running robotics alongside the broader business adoption of artificial intelligence technology.

•    Financial and productivity support—state-level manufacturing GDP contributions coupled with recent productivity gains.

•    Utility feasibility—commercial electricity rates, which dictate the long-term ROI of heavy automated equipment.

“Texas takes the top spot with an index score of 79, a manufacturing GDP contribution of $3.7 billion and a 19 percent AI business integration rate,” explains Dunagan. “Indiana and Wisconsin follow closely behind, showing that America's traditional industrial heartland is leading the way in physical hardware deployment.

“Both states have the highest manufacturing workforce densities in the country, with 7.46 percent of Indiana's population and 7.69 percent of Wisconsin's working in the sector,” adds Dunagan.