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Economy Watch
Saturday, October 29, 2005 Here are the articles on the economy from last week. Economic Growth Accelerated in 3rd Quarter Vital Signs for the Week of Oct. 31 Intuition may prove key to Bernanke's success or failure For Greenspan, Less is Always More Economist Chief Offers Business Trends Report Confirms U.S. Has Work To Do To Stay Competitive Who will take care of an older population? Downside to high-tech pay, venture capital suggested No Need For Economies Of Scale Share the Knowledge, Expand the Wealth posted by Ed | Incentives Watch Here are some of the articles on incentives I came across last week: Nebraska's governor is happy with the new economic development package that recently passed the legislature. He says that it is already showing results. Read more. Bill Clinton's presidential library is eligible for $3.5 million in tax breaks, according to the Arkansas Supreme Court. Read more. Lenovo, the Chinese company that acquired IBM's personal computer business, could get as much at $11 million in incentives from state and local governments in North Carolina. New York and Georgia also competed for the 400 jobs.Read more. In North Carolina that's only about $27,500 per job: chump change. Incentives in the state have generally ranged from $45,250 per jobs for Credit Suisse (2004 deal for 400 jobs) to $411,000 per job for Nucor (1998 deal for 391 jobs). A conservative commentator argues that incentives have "gone wild". Read more. An Indiana executive speculates on the impact of a Supreme Court decision in the Chrysler Jeep case (Cuno v. DaimlerChrysler) that is due this term. Read more. In Memphis, controversy is heating up over the use of payments in lieu of taxes (PILOTs) by county governments. Read more. T-Mobile has set up a call center with 700 projected jobs in Springfield, MO here are the details. Read more. Dell explains that its $318 million incentive package from North Carolina was only one factor in its decision. Read more. Savannah kept an important asset in the basket when Gulfstream announced that it would keep its R&D center in the region. Although no details were released, the company received a "standard" package of incentives. Read more. posted by Ed | Savannah's Creative Coast Savanna is the home of a new type of economic development organization, Creative Coast Initiative. This effort, similar to the Charleston Digital Corridor in Charleston, SC, focuses on attracting and developing knowledge-based businesses. Read more about the Creative Coast Initiative. Visit their web site. You can also visit the web site for the Charleston Digital Corridor. posted by Ed | Partner with someone who does When you don't have resources in your region, partner with someone who does. Civic leaders in eastern North Carolina are taking the right step in forming a partnership with the Council for Entrepreneurial Development based in the Research Triangle region. The Council is a long-established leader in providing entrepreneurial support for entrepreneurs and high impact businesses. Read more about the collaboration. posted by Ed | Combining ED organizations in Lafayette, IN Economic development consultant Tom Ticknor has been working in Lafayette and West Lafayette, Indiana for the past year. Last week, he released his report recommending that six different economic development organizations all merge into one new organization. The groups include the Downtown Business Center, Greater Lafayette Community Development Corp., Lafayette Urban Enterprise Association, Lafayette-West Lafayette Chamber of Commerce, Lafayette-West Lafayette Economic Development Corp. and Vision 2020. The goal is to try to achieve this consolidation by July, 2006. The board of each group now must consider the consolidation plan and vote on whether to take part. Read more. posted by Ed | Thinking about regions in North Alabama Several communities last week focused on the opportunities of regional collaboration. In North Alabama, civic leaders heard from Doug Henton, president of Collaborative Economics. Henton made the point that, "Basically we are a nation of regions, and regions are becoming more important in trying to address such issues as economy, environment and transportation". Read more. posted by Ed | Shaking up South Carolina Darla Moore has been shaking up the economic development landscape in South Carolina for a number of years. A very successful businesswoman, Ms. Moore has been promoting the development of a new strategy for economic development in the state. Based on the Porter's theory of cluster development, the new strategy focuses on building innovation and productivity with new clusters. You can download a presentation on the strategy here and some additional background on the the Palmetto Institute. In a recent speech in Myrtle Beach, Ms. Moore focused her criticism on the existing state Department of commerce. She sees the department still focusing too much on promoting a South Carolina to businesses as a low-cost location with cheap labor, water and land. Read more. posted by Ed | Focusing on existing businesses More and more economic developers understand that existing businesses provide an important engine for future growth. Here's a good example. Last week, the economic development corporation of Manitowoc County, Wisconsin released its new strategy, "Roadmap to Success". The report emphasizes the importance of supporting existing businesses as a top priority. Read more. You can download a Powerpoint presentation that gives you background on the economic development corporation. Go. posted by Ed | Report on best places to work Last week saw the release of a controversial report on working environments of all 50 states. Prepared by researchers at the University of Massachusetts, the report ranks states based on different dimensions of economic performance. These indicators include average pay, employee benefits, and the percentage of low income workers. The report's authors suggest that this report is the first of its kind to measure economic performance on the treatment of workers, instead of the treatment of businesses (with business climate surveys). States in the New England area fared well under the new index, while states in the South generally performed relatively poorly. Read more background about the report. Here is a Associated Press report. You can view of map of the scores here. You can download the report here. posted by Ed | Ball State's Building Better Communities initiative Governor Daniels visited the Ball State campus recently to learn how that university is accelerating community development across the state, through its Building Better Communities initiative. Read more. Recently, Intel announced that Ball State was the most unwired campus in the country. Learn more. Next week, I will be visiting with President Gora and her staff at Ball State to learn more about what they're doing on the campus. posted by Ed | Focusing University of Iowa's economic development initiatives The University of Iowa is integrating its economic development activity into one location. The university currently operates six business development initiatives. Read more about what the university is doing. EDPros can help their local colleges and universities rethink their role in economic development. One of the most direct ways to start the conversation: Provide administrators with models of how other schools organize their economic development initiatives. posted by Ed | The economic return of a college education According to a new research report from the business school at Arizona State University, a college degree has a higher return than the stock market. The researchers calculate that the rate of return on money spent on to earn a bachelor's degree is 12% per year, compared to the long run on average annual return on stocks of 7%. Read more. Download the report. Technical education provides even higher rates of return. In an earlier post (below) I pointed out the remqarkably high return on investment from technical education in manufacturing. Learn more here. posted by Ed | University of Kentucky moves ahead with Coldstream After years of missteps, the University of Kentucky's Coldstream research campus appears to be gaining some momentum. Established in 1989, the research park has never been able to accomplish its potential. Now, however, with the leadership of the president of President Lee Todd, the university is making some significant strides toward improving the situation. Read more. I am currently working in the Bluegrass region with Commerce Lexington. We're developing a strategy to build a more open and collaborative economic development strategy in the region. Read more. Building stronger connections between the business community and the University of Kentucky will form a major component of our work. posted by Ed | Oklahoma City's Wi-Fi advantage While a number of cities across the country, including Philadelphia and San Francisco, are grabbing headlines about building WiFi networks. Oklahoma City has a unique advantage. The city has one of the largest contiguous WiFi networks in the world, and it is already in place. Read more. posted by Ed | The growing importance of technical education Increasingly, economic development professionals are coming to understand the technical colleges or community colleges are critical components of a high-performance economy. While relatively few jobs require four years of college education, an increasing number of jobs require education past high school. Here's a rule of thumb: jobs earning over $10 an hour will require postsecondary education. In other words, high school is no longer a ticket to the middle class. Here's a good overview of these themes in an article from Wisconsin. Read more. In an earlier post (below) I pointed out the remqarkably high return on investment from technical education in manufacturing. Learn more here. posted by Ed | Manufacturing careers A manufacturing summit in Minnesota highlighted a product problem from manufacturers. Few young people have a current understanding of the opportunities in the manufacturing sector. Many parents and teachers have outdated the views of manufacturing careers. They see manufacturing jobs as dirty, dangerous and dead-end. In contrast, most manufacturing jobs today require high levels of technical skill. These skills include the ability to read blueprints, integrate design into machine setups, and the understand the integration of automation. Read more about the Minnesota summit. Recently, I interviewed a component manufacturer here in Northeast Ohio to understand more completely the career path of technical jobs in a component manufacturing operation. Component manufacturing involves manufacturing parts for larger original equipment manufacturers. (In Northeast Ohio, we are working with a group of component manufacturers on a new approach to accelerate automation. This appraoch, which we call RAMTEC, is designed to help smaller component manufacturers focus on improving productivity and quality by applying automated solutions. In Wisconsin, they have worked with OEMs to strengthen their base of component suppliers. In Ohio, our approach is different. We are building a collaborative among the component suppliers.) Component manufacturers provide different jobs with different levels of technical education. At the entry level, a technician or operator knows needs to know how to read blueprints and manage automated equipment. Interestingly, one of the critical skills of a machine operator is the ability to listen to the machine and diagnose problems almost intuitively. These jobs are currently paying about $15-$20 an hour in Ohio. The step above the basic operator, is the programmer. The programmer gives instructions to the equipment to perform needed tasks. The programmer must understand the language that commands the robot and the equipment. The programers currently earn between $45,000 and $65,000. Across the factory for maintenance technicians can earn between $60,000 and $80,000. They require a two years of electronics training and usually develop their capability by working their way through other lower jobs. Above this level comes the applications engineer. These jobs involve managing the production floor and can pay between $65,000 and $100,000 a year. The applications engineer decides how different parts can be machined on different pieces of equipment and what tooling is required. The applications engineer understands programming, but also understands tooling and the capabilities of different equipment. Above the application engineer comes the systems integrators. These people can make between $125,000 and $175,000 year. They require both mechanical engineering and electronics training. These highly skilled engineers are able to integrate equipment from different vendors. In Pittsburgh, educators are addressing the chronic shortage of skilled workers with high school technical training in robotics. The students learn how to operate an maintain robots. Read more. Applying automation represents a big opportunity for U.S. component manufacturers. These companies, mostly small, have lagged in their application of robots and other forms of "hard" automation. Here's a useful overview article. Here's another view of the opportunity: The return on investment for the training of new and incumbent skilled manufacturing employees is higher than on most capital investments. The return on technical education for manufacturing is also much higher than the return from a non-technical four year college education. Read this analysis. (Thanks to Tom Strbac of Titan Manufacturing for this link.) posted by Ed | Web Watch: Northeast Indiana Innovation Center Last week, the Northeast Indiana innovation Center opened its new campus in Fort Wayne. The innovation Center is an entrepreneurial incubator and accelerator, designed to support early stage companies. You can visit their web site here. posted by Ed | Ohio's Issue 1 Ohio voters will have the opportunity to pass a new statewide investment program for economic development in November. In the past, the Governor Taft attempted to expand his Third Frontier initiatives, but the voters turned him down. This time around, the governor is packaging is Third Frontier initiatives with more traditional infrastructure investments. Read more about Ohio's Issue One. The irony is that Governor Taft is the most unpopular governor in the country. In order for him to have any chance of passing Issue 1, he needs to make himself scarce. Read more. Incredibly, Governor Taft has a 17% approval rating. In twenty years of looking at political polls, I have never seen an approval rating for an incumbent so low. View the ratings. posted by Ed | Supporting rural entrepreneurs New, entrepreneurial strategies are emerging in rural areas. Last week in Minnesota, economic developers came together to hear about different strategies for supporting entrepreneurs in rural economies. "There are people all over rural America who are breaking out and doing things in a very different way," said Craig Schroeder, a senior associate at the Rural Policy Institute's Center for Rural Entrepreneurship in Nebraska. Read more about the Minneota meeting. Visit the website, Enregizing Entrepreneurs sponsored by the Center for Rural Entrepreneurship. Download ar report on strategies for sustainable entrepreneurship. posted by Ed | Web Watch: South Dakota products site Wednesday, October 26, 2005 South Dakota has launched an engaging site to showcase the arts, crafts, and creative economy of that state. You can read more about the site here. Or, you can visit the site. This type of promotion makes sense, especially to help rural economies. As more an more states discover their "creative economies" we can expect to see more state and local sites to promote local arts, crafts and culture. To learn more about the creative economy, you can visit this website of the Creative Economy Council in New England. To see how a state is embracing this approach, you can look at this report from Vermont. You can laso read about the work of on the creative economy taking place in Maine. posted by Ed | Syracuse as a hub for technology development Sunday, October 23, 2005 Syracuse is defining a new vision for its regional economy. During the fuse2005 technology conference last week, civic leaders heard from an outside speaker, a British legislator and executive director of a technology merchant bank. Their guest painted the picture of Syracuse as a hub for technology development. Read more. posted by Ed | Venture investing in Eastern Tennessee Tennessee has been steadily building an innovation economy in Eastern Tennessee between Knoxville and Oak Ridge. They have branded their efforts Innovation Valley. As part of this strategy, business leaders have established a $35 million venture fund, and last week they announced their first investment. Read more. You can visit the web site of Inovation Valley here. posted by Ed | Report: "Strengthening America's Communities" Here's a report I may have missed last summer. The Department of Commmerce issued a report on Strengthening America's Communities. You can learn more about the intiative from this page. You can download the report here. The report focuses on President Bush's proposed overhaul of economic development and community development programs. Given the politcal problems that the Bush administration is facing, the prospect for these proposed reforms is not at all clear. posted by Ed | Rhode Island's Science and Technology Advisory Council In Rhode Island, Governor Carcieri appointed the Governor's Science and Technology Advisory Council (STAC) last April. Read more. The Council is charged with the responsibility of developing a strategic plan to help Rhode Island keep scientists, encourage companies to be more innovative, and attract science and technology research dollars from the federal government. Read more about the Council's activities. posted by Ed | Don't try this at home: Colorado's technology report Colorado has released a new report that (not surprrisingly)supports the proposition that Colorado is one of the leading technology states. Read more. One problem, though: After a little digging, I was unable easily to find the report. The lesson: if you are going to pump a report, make sure it is easily available. (The web site of the Colorado Office of Economic Development and International Trade needs a little work. The site promises "new & Improved site navigation system coming Summer 2005".) posted by Ed | Maine's Creative Economy Council Last year, Governor Baldacci of Maine established the Creative Economy Council. The twenty member council has begun its work to define a strategy for the state. They hope to complete their work next March and submit a report to the governor and the legislature. Read more about the Council's activities. New England states have been developing a focus on the creative economy for a number of years (even prior to Richard Florida's book). Here's an overview. posted by Ed | Report: new approaches needed in Mobile The Competitive Strategies Group has released a report recommending a new regional economic development effort in Mobile, Alabama. The report reveals that local civic leaders rank current efforts as average or below average. In addition, according to Jay Garner, the report's author, "People mentioned there's a need to have a leader or a quarterback to lead economic development. ... In their opinion, none exists in the Mobile region." Read more. posted by Ed | Indiana's Director of Entreprneurship In a continuing move to reorganize the state's economic development efforts, officials at the Indiana Economic Development Corporation have appointed a new director of entrepreneurship for the state. Read more. posted by Ed | Iowa's Values Fund still controversial The governor's race in Iowa will be focusing on the state's controversion Values Fund, according to this report from the state. The initiative represents a major component of the out-going Democrat Governor Tom Vilsack's economic development strategy. But both GOP candidates for next year's election oppose the initiative. A recent report from the Iowa Economic Development Board shows that companies revceiving funding from the Values Fund have much more to do to reach job targets. Read more. posted by Ed | Framing new opportunities in rural North Carolina The North Carolina Rural Economic Development Center is using workshops to frame new perceptions of the rural economy in that state. The first workshop is entitled: “Small Town, NC: Embracing Change, Taking Charge." The Center will release a fact book on North Carolina's 4789 small towns. Read more. In addtion, the Center has launched a series of entrepreneurship workshops. Read more. posted by Ed | Atlanta's new logo Last week, Atlanta's mayor introduced the city's new logo. The logo contains the letters “ATL” inside a red and white swirling circle. The circle represents three themes selected to attract visitors and business investment to the city: opportunity, optimism and openness. Read more. posted by Ed | Is Connecticut losing its competitive edge? Civic leaders in Connecticut are looking at the state's competitive position. The Governor's Competitiveness Council last week reviewed a new report by the Connecticut Economic Resource Center. The report warned that Connecticut was losing its competitive edge to other states. Read more. Download the report. posted by Ed | Louisiana: ""We can't afford not to work together" Tuesday, October 18, 2005 Governor Blanco has appointed her own high profile group to assist the state in rebuilding. The governor's commission will (hopefully) work closely with the panel (the Bring Back COmmission) assembled by the New Orleans mayor. Read more. The mayor's commission has announced that it will be working with the Urban Land Institute. Read more. posted by Ed | Oregon builds biotech According to this overview, Oregon is making steady, if modest gains in building its bioscience cluster. In these matters, success is relative: As one observer notes, "We don't have to be a big as San Diego or Boston to make a profound impact on the state."Read more. posted by Ed | Composites as a growth segment in manufacturing The South Carolina Manufacturing Extension Partnership (SCMEP) is focusing on the use of composites in manufacturing as a growth area. SCMEP is expanding its composities technical assistance program statewide. According to SCMEP, "Composites represent the fastest growing segment of manufacturing." Read more. posted by Ed | Economy Watch Friday, October 14, 2005 Here are the best articles I came across last week: Inflation rises in U.S. Fed's Olson says watching price pressures closely Vital Signs for the Week of Oct. 17 Beginning of the end of U.S. auto industry? Inflation surge: Here to stay? Greenspan: Flexibility Critical to Economy Value of U.S. ideas is huge, but protection is lax, study finds Europe Is Key to U.S. Companies’ Global Success America's Fall in R&D: "Nobody Cares" Avian Flu Under the Microscope posted by Ed | Incentives Watch Here are the articles on incentives from the last week. Opponents of the Dell incentive package in North Carolina are still pursuing their lawsuit. Dell's attorney are trying to have the case thrown out. Read more. Most state governments have limited leverage over local land use decisions. Governor Romney in Massachusetts is pressing for a new set of incentives to reduce the time local governments take to process land use permits. Read more. Overland Park, KS is not a place that freely spends on incentives. But when a big deal comes, so do the incentives. This article focuses on one of the paradoxes of local incentives. Political leaders tend to turn to incentives based on the size of the deal. But the bigger the deal, the bigger the company, and the less likely the company really needs incentives in the first place. (State and local taxes and other costs are not a big part of any company's cost structure.) Read more. Google has announced that it will be building a facility in Arizona. Now local governments are hoping the an incentive war is not about to break out. Read more here, here and here. Incentives for one deal can breed pressure for more incentives. That's what they are finding out in Dallas. Read more. Expansion Management has an article on incentives from the perspective of companies. Read more. posted by Ed | Michigan: Roadmap to the future The Millenium Project at the University of Michigan explores new models of higher education in today's knowledge economy. The project has just released a report on the future of the Michigan economy. You can download it from this page. posted by Ed | Denver completes competitiveness assessment Metro Denver Economic Development Corp. has completed a review of the competitive position of the metro economy. You can read more about the report here and here. The report prompted some advertising, which has, in turn, triggered controversy. Learn more posted by Ed | Alabama's top EDPro: Focus on existing firms Last week, Alabama's top EDPro outlined his state's strategy, and he emphasized the importance of focusing on existing businesses. That's another sign that EDPros are starting to balance their initiatives more realistically. While recruitment strategies still make sense, they need to be balanced with other initiatives. Read more. posted by Ed | Wisconsin manufacturing study Wisconsin manufacturers have to be ready to adopt strategies that emphasize speed and flexibility, offering products that compete more on value than on price. That's one of the conclusions of a new report on manufacturing in the state. You can read more about the report from this article. You can start the download process from this page. (You need to register to download.) posted by Ed | Resource: Report on inner city economies The Small Business Administration has released a report on the dynamics of inner city economies. The Initiative for a Competitive Inner City prepared the report. You can read about the main findings of the report here. You can also download the report. posted by Ed | Building regional momentum in Milwaukee The regional perspective is gaining momentum in Milwaukee. Metropolitan Milwaukee Association of Commerce (MMAC) has joined with the Greater Milwaukee Committee (GMC) and the City of Milwaukee to promote an economic development agenda for the seven-county Southeast Wisconsin region. One of the challenges is creating a strong brand. Here's some more background. Read more. You can learn more about the general regional strategy from this page posted by Ed | Micropolitan explained In 2003, the Census Bureau created the concept of micropolitan areas. Micropolitan areas are based around a core city or town with a population of 10,000 to 49,999. The bureau has identified 578 micropolitan areas. If you are interested, but confused, here's a helpful article. Read more. (Here's another good overview from USA Today.) If you're a data wonk, here's the general reference page from the Census Bureau. Go. posted by Ed | More on the Propserity Partnership In the Puget Sound region of Washington, a new regional partnership -- the Prosperity Partnership -- appears to be heading in the right direction. A collaboration among four counties, the partnership has structured the issues around economic development for the region. That's an important step. In many regions, the conversations around economic development are not coherent or focused. There's no consensus about what is important. In the worst cases, the agenda gets hijacked by narrow interests. More common, civic leaders focus on the wrong issues. A third outcome: inaction. No one can muster enough enthusiasm and focus to do anything. Economic development, like all investment, is a game of probabilities. The tricky part is to define those investment partnerships that have can accelerate innovation and productivity. That requires on on-going cycle of figuring out what works. The region needs "civic spaces" where these conversations can take place. It looks like the Prosperity Partnership has created the civic space for these focused discussions. Here's some background on the Prosperity Partnership. Read more. posted by Ed | Business impacts of global warming Global warming may not register among politicians in Washington DC, but some business leaders in Oregon are concerned. They issued a report last week on the economic impacts of rapid climate change. Read more. The governor is receptive to the importance of global warming. You can learn more about his initiatives from this page. In March, 2005, the governor's advisory committee on global warming issues its report. Download the report. In 2003, the governors of California, Oregon and Washington launched an initiative to reduce greenhouse gas emissions. You can read a background report here. posted by Ed | Early childhood education as an ED tool A new study by Marshall University in West Virginia has reframed early childhood education as an economic development tool. Read more about the report. Download a PowerPoint presentation. Or, download the executive summary. posted by Ed | The necessity of post secondary education Thursday, October 13, 2005 Here is a commentary worth repeating: Post-secondary education of some kind -- technical school, community college or a four-year university -- is a 21st-century necessity. Read more. A high school diploma is no longer a ticket to a secure future. Worse still, dropping out of high school creates a lifetime economic disability. posted by Ed | Samsung's impact on Austin The big Samsung $3.5 billion chip project looks like it is heading to Austin, and here is an article that explores the potential impact on the regional economy. Read more. posted by Ed | No low tech industries, just low tech companies In economic development, we have a tendency to want targets. Part of the explanation lies, I think, in the traditions of the profession. One major branch of the profession started with recruitment strategies. (The other major branch developed out of urban development.) So, as we began to shift our thinking to clusters, we have tended to pick a handful of clusters on which to focus. It makes more sense, though, to focus on promoting practices that accelerate innovation...And innovation can emerge from anywhere. As Michael Porter points out, there are no low tech industries, just low tech companies. Read an interesting commentary that raises some of these issues. posted by Ed | Helping entrepreneurs in rural Iowa The University of Northern Iowa Regional Business Center and Small Business Development Center launched an initiative worth watching. MyEntreNet focuses on supporting entrepreneurs in rural counties. According to the director: “We really decided to make a long term investment in rural economic vitality and in helping rural Iowa improve its local economies through entrepreneurship.” Read more. You can learn more about the model from this page. posted by Ed | Retirees as an economic development strategy Retirees represent a useful economic development strategy for some regions. Here's what's happening in Southwest Missouri. Read more. Here's a few thoughts to consider: The economic power of a retiree strategy depends in large part on the wealth of the retirees and the extent to which your economy is diversified. (More diversification = Less leakage) Jobs generated by retirees are likely to be in low wage service employment, although there will be some higher income jobs gained in health care and business services. The extent of job generation will depend on the "leakage" of dollars from the economy. Large influxes of retirees can be disruptive to local residents. So, for example, high income retirees can bid up property values. Higher property prices can benefit property owners but reduce the supply of affordable housing. Another example: retirees can oppose increased taxes to support education. posted by Ed | Real world training in higher education There's a new trend in higher education that holds important implications for economic development: The emergence of entrepreneurial leaders who are pushing new "applied" approaches to education. If you are lucky enough to attract a leader of this type to your community, they can have a big impact on the economic development climate in your region. Businesses will respond to this type of market-driven solution to education and training. The article introduces us to the example set by Morrisville State College at the State University of New York. Students are engaged in "real world" experiences in order to learn. Read more. posted by Ed | Using restaurants to anchor business districts Cities are using restaurants as anchors for business districts. Here is a good article that discusses this trend. The trend represents another dimension of the shift in economic development from recruiting companies to recruiting people. As one city official in Lowell comments: ''Instead of saying, 'How do we get companies to come here?' we're asking, 'How do we get people to live here?' "Read more. (Here's another example, this time from Mississippi. Read more.) The article refers to a paper written by Harvard Professor Ed Glaeser. You can download that paper here. (A lesson for New Orleans: instead of investing in gaming, promote even more new, good restaurants.) posted by Ed | Resource: Workforce development and economic development Workforce development is becoming a critical factor in economic development. So, it's not surprising that Expansion Management magazine has published a good overview of the connection between workforce training and economic development. The magazine conducted a survey and found that Georgia, Alabama and Kentucky have the top-rated workforce development programs, according to site selection consultants. Read more. You can download a chart of a fifty state comparison of workforce training programs here posted by Ed | Economy Watch Saturday, October 08, 2005 Here are the articles on the economy from last week. U.S. employment slips Vital Signs for the Week of Oct. 10 Entrepreneurship Going Strong in 2005 According to SBA Study: U.S. economy not most competitive CEOs remain optimistic in the face of dark clouds Study finds that 37% of all working time is effectively wasted America’s Aging Workforce Posing New Opportunities and Challenges for Companies posted by Ed | Incentives Watch Here are the best articles I came across on economic development incentives last week. The debate over corporate incentives (or subsidies, depending on your point of view) is heating up in different states. We, of course, have the controversy over the Dell plant in North Carolina. In Colorado, a report has also sparked controversy. Read more. Download the report. Meanwhile in Oregon, a commentator reviews a recent news article in Rhode Island critical of incentives. Read the Oregon article. Download the Rhode Island article. On the Big Project front, Samsung is apparently headed for Texas with its big chip plant. Oregon and New York have been competing with Texas. For a quick swing around the country, read more here, hereand here. A representative of the South Carolina Manufacturers Alliance argues that the state is not giving enough incentives. Read more. (If you had any doubts about the global economy, you can see that hours after this report appeared, a news site for the textile industry in India picked up the story. Read more. There's No Free Lunch Department: Here's an insight into how tax incentives play out at the local level. Boone County, Missouri has backed a new incentives poilicy, but critics question why economic incentives should be allowed to narrow the tax base for other public services. Read more. Resources: I came across this report from the Center on Budget and Public Policy Priorities: Should Congress Authorize States to Continue Giving Tax Breaks to Businesses?Download the report. posted by Ed | Web Watch: Virginia launches new business portal Virginia has launched a new web site for business assistance. Business portals sound so compelling. But they are tricky to get right and very difficult to build. As one participant in this projects notes: "The biggest challenge in creating the business portal was organizing the vast amount of information and resources to ensure that the questions and needs of business users and other customers are answered in the most efficient manner possible." In short, how do you organize information in a way that solves problems quickly? You can read about the background here. You can visit the site here. posted by Ed | Opinion: Apathy is a widespread problem Terry Cusak of Stellar Fundraising Executives, Inc. submits this opinion piece to EDPro. According to Terry, "Board apathy resulting from weak leadership and fear is a growing issue for economic development and chamber of commerce professionals across the country." Read more. If you would like to submit an opinion piece for publication in EDPro, please e-mail me. posted by Ed | Entrepreneur magazine list of best cities Friday, October 07, 2005 Entrepreneur magazine has published its list of entrepreneurial climate for cities across the U.S. You can see the list here. posted by Ed | Building broadband and wireless infrastructures A variety of articles have appeared this week on how those cities and regions are adopting the broadband and wireless infrastructure. Here's an overview article. Read more. In Philadelphia, the city's initiative, Wireless Philadelphia, announced plans to establish its WiFi network by the end of 2006. here and here. In San Francisco, Google has stepped forward, as I mentioned last week. But the Google plan has drawn questions. Read more. In Manassas, Virginia civic leaders are investing in another approach of providing a broadband over power line technology. This system works through the local electrical utility to allow people to access the Internet simply by plugging their computers into electrical outlets. Read more. In rural Loudoun County Virginia, residents are experimenting with a range of different options, including providing wireless broadband access at libraries. Read more. In Rockville, Maryland the town center has a new wireless hotspot. The new Internet technology complements a new library, a new business incubator, and new public spaces. Read more. posted by Ed | Regional strategy in Puget Sound The Prosperity Partnership in Puget Sound, Washington has released its new economic development strategy for the region. You can read more about this strategy here. You can download the strategy from this page. posted by Ed | Comparing Chicago and Buffalo Chicago and Buffalo. Two northern cities sitting on the Great Lakes. A delegation of civic leaders from Philadelphia recently returned from a trip to Chicago. Civic leaders in Chicago impressed their Philadelphia colleagues with the aggressiveness of their thinking. Setting the appropriate to stretch goals represent one of the major challenges for economic development leaders. The Chicago leadership has developed a habit to of this type of aggressive thinking. Read more. Contrast the situation in Chicago with the civic leadership in Buffalo. Here, wars and political controversy continued to undercut the effective development and implementation of effective economic development strategy. Without strong civic habits of collaboration, trust cannot build. And without trust, regions cannot undertake the type of aggressive investments needed to transform their economy's. Read more about Buffalo here. It matters how civic leaders spend their time. Their conversations determine their direction. posted by Ed | Financial services in San Antonio Here's an overview article of how the San Antonio economy has developed opportunities in the financial services cluster. Read more. posted by Ed | Regional strategy gets traction in Western North Carolina Polk County, North Carolina has endorsed a new regional strategy for economic development. The strategy covers the Isothermal region composed of Cleveland, McDowell, Polk and Rutherford counties in Western North Carolina. The economy of Western North Carolina is facing the same challenges of many rural economies. Globalization has placed relentless cost pressure on manufacturing plants in these regions. Many of closed or downsized. At the same time, the development of knowledge-based businesses is slow, in part because of the lack of information infrastructure in rural regions. To be successful, rural counties will have to develop more aggressively their innovation and infrastructure entrepreneurial networks. Western North Carolina recognizes the challenge and has been moving steadily in this direction. AdvantageWest leads these efforts. Learn more. Based on the published reports, the strategy developed for the Isothermal region is impressive, because they clearly outlined in metrics by which to measure their success. For example, the strategy is designed to raise the number of adults over the age of 25 with a least a high school diploma. Each county has its own set of targets. Read more. posted by Ed | Dell opens controversial NC plant Dell opened its new computer manufacturing facility in North Carolina this week. The deal remains controversial, as taxpayers groups are still upset about the level of subsidies provided to the plant. Read more here, here and here. View of picture of the plant here. The subsidies to Dell are hard to justify, especially when you think that the same amount of money could pay for remedial reading for 50,000 to 60,000 children. Keeping kids in school has long term pay-outs. A young person who drops out of school reduces lifetime earnings by about $200,000. Which is the better economic development investment? Not surprisingly, the official Dell press release makes no mention of the incentives. Read more. posted by Ed | Redefining the ED role of a research university Universities are redefining their role in regional economic development. Don Berger, Marketing Director, MidAmerica Industrial Park sent me an announcement of a partnership between MidAmerica and Oklahoma State University-Okmulgee. The partners dedicated a new Enterprise Center. Learn more. The selection criteria for the center are available here. Here is article on the University of North Carolina and its economic development role. Read more. The president of the University of Kentucky has written a column in the local paper explaining how his university is strengthening the relationships between the university and the state economy. Read more. In Pittsburgh this week, both the University of Pittsburgh and Carnegie Mellon University highlighted their role in developing advanced research to promote economic development. At, the University sponsored a showcase on science and technology. Read more. At Carnegie Mellon, the University focused on its technology transfer activities. Read more here and here . The University of Missouri (MU) is launching its first technology park, patterned after similar efforts such as Discovery Park at Purdue. Read more. At Cornell, a new technology park will connect agricultural research with business development. Read more. If you are interested in getting more background on the role research universities plan in economic development, download this report from the Southern Growth Policies Board. posted by Ed | Oregon reorganizes Oregon is streamlining its economic development organizations under the Oregon innovation Council. The purpose of the council is to simplify the connections between different economic development groups at the local level and state government. Read more. posted by Ed | Cincinnati builds biotech Tuesday, October 04, 2005 Cincinnati is another region placing bets on biotech. The research base is not as strong as other regions, but EDPros at CincyTech are determined. Read more. posted by Ed | Designing computer nanochips in Albany Building a research base with strong anchor investments is a critical component to establishing new technology-based cluster. We see a new cluster in nanotechnoloigy emerging in Albany. The campus of Albany Nanotech has now attracted the three largest computer-chip equipment manufacturers. The latest addition involves a $330 million partnership among Albany NanoTech, IBM and Applied Materials. This commitment of private investment underscores the transformation underway around Albany. Representatives from Applied Materials hope that the partnerships can be expanded to include universities such as Cornell and Rensselaer Polytechnic Institute. Read more. posted by Ed | The New England Futures Project Neal Peirce, the noted national columnist, has focused his writing on the challenges facing metro areas. Now he and his colleagues have launched The New England Futures Project, an effort to explore regional issues in New England. Here's their first of six articles. Download a copy. You can also visit the project web site. posted by Ed | Collaborating in the Triad The Triad region of North Carolina has been delivering a stream of good news over the past year. At the core of this success lies a new attitude of cooperation. Read more. posted by Ed | Building a new economy in Southeast Michigan The Great Lakes states face a major restructuring in their economies. Global cost pressures are compressing the region's industrial economy. A number of states -- Pennsylvania, Wisconsin, Michigan come to mind -- have been launching a range of interesting initiatives to manage the adjustment. Automation Alley and Ann Arbor Spark represent two of the more interesting initiatives. Launched in Southeast Michigan, both organizations are making strides in building a new technology-based foundation for the regional economy. Read more. posted by Ed | Purdue reorganizes extension University extension offices can be a remarkably valuable network to transform a rural economy. To seize this opportunity, Purdue has reorganized its extension offices. Read more. Visit the web site. posted by Ed | Birmingham builds biotech Creating a biotech cluster is not easy, even if you have a relatively strong base of research. Here's a good review of what has been going on in Birmingham. Read more. Producing good science is simply a starting point. Creating an innovation system to support biotech business development requires supportive university policies, experienced management, sophisticated investors (willing to invest a lot), a pool of technical talent, specialized facilities, and effective marketing. Oh, yes, you also need a lot of patience. posted by Ed | Resource: Art in rural economies The National Governors' Association has released a report on how the arts can strengthen rural economies. You can download the report from this page. posted by Ed | Economy Watch Saturday, October 01, 2005 Here are the best articles on the economy I came across from last week. Katrina leaves economy on the ropes U. S. Economy: Hurricanes Drive Incomes Lower, Push Up Prices Economic revival up to consumers Katrina, high energy costs hammer consumer spending CBO sees modest harm from hurricanes to U.S. economy Vital Signs for the Week of Oct. 3 Will Fed rate hikes blow economy off course? Study: U.S. economy not most competitive Nordic, U.S. east Asian economies most competitive Finland economy most competitive in world posted by Ed | Incentives Watch here are the interesting articles on incentives from last week. Of course, the big news is that the Supreme Court will review the Federal appellate court's decision in the Ohio incentives case. Learn more. The public records case over the Dell incentives in North Carolina has reached a settlement. Read more. Meanwhile the Dell plant is scheduled to open. Read more. (Meanwhile, in an ominous sign, Dell's customer satisfaction ratings are dropping. Read more.) Bartlett, TN is using a range of incentives to help target development investment downtown. These include offering real estate brokers a 1-percent bonus when they sign businesses for at least three years. Read more. The Western Illinois Economic Development Partnership has an intereesting appraoch to promoting investment incentives: a regional Financial Incentives Resource Fair. Read more. The idea of giving Gulf Coast casinos incentives is making some people gag. Read more. Here is an example of what I suspect will be a growing trend -- increasing incentives to people, instead of comapnies. The governor of Rhode Island wants to improve science and math education, and he is prepared to provided financial incentives to do it.Read more. Mississipi's legislature is considering a bill to scale back incentives to a steel mill from $75 million to $60 million. Read more. Boeing's tax incentives will kick in this week. Read more. posted by Ed | Collaborations between Madison and Milwaukee In Wisconsin, new regional alliances are beginning to emerge, as civic leaders in Madison and Milwaukee recognize that they have more to gain from collaboration. Here is a good article that surveys some of the recent developments. Read more. One interesting insight: ultimatums don't work very well. A few years ago, when the mayor and university head in Milwaukee drew a line in the sand, the folks from Madison simply walked away. And that's the point: In a networked world, people have options. Part of the challenge of building open regional innovation systems comes in creating new civic behaviors, new habits of collaboration. That's what appears to be emerging in Wisconsin. posted by Ed | Purdue and Monitor Group to study rural clusters While visiting with colleagues at Purdue last week, I learned that the Economic Development Administration had awarded Purdue's new Center for Regional Development and the Monitor Group (Michael Porter's firm) with awards for research into rural clusters. In August, the EDA solicited proposals for a project designed to address competitiveness and innovation in rural U.S. regions. This project has two research priorities, (1) further analysis of existing raw data and (2) a Rural Clusters of Innovation Project that would result in a regional implementation plan based on an inventory of regional assets of one rural region. Read more. The Purdue project will involve using extension educators in two target regions. One of the major assets we havein rural areas comes from extension offices. Yet these offices have not been used effectively to engage stakeholders. This project should help EDA identify how other rural regions can use cluster-based analysis with their extension offices to build their economies. posted by Ed | Different yardsticks for location decisions If all you have is a hammer, everything looks like a nail. That's a little bit of the predicament for site selection consultants who evaluate locations based on costs. Take the case of The Boyd Company. The New Jersey-based consulting firm has a long and distinguished record for evaluating different sites based on detailed cost studies. (They develop a cost model for a model facility -- say a warehouse or corporate office -- and then use that model to gather costs from different locations.) The problem is that not all business decisions are driven by cost. In mature markets, cost structures play a very important role in competitiveness. But in emerging markets, costs are less significant to the existence of open innovation systems. This explains why high value businesses continue to emerge in high cost locations. So, the folks in Phoenix are right, I think, to criticize the latest report from Boyd concerning locations for biomedical companies. Read more. posted by Ed | Michigan's Core Technology Alliance Life science research is complex and expensive. In Michigan, three research universities and a research institute launched the Core Technology Alliance in 2002. The Alliance started as a consortium of Michigan State University, Wayne State University and the University of Michigan, and the Van Andel Research Institute. Developing clusters often requires heavy anchor investments. In some instances, these anchor investments come from large companies. In other cases, the university or public sector must make the commitment. The Core Technology Alliance represents an effort to develop a collaborative network of technologically sophisticated core facilities to accelerate life sciences research and product development. Through the Alliance, researchers based in Michigan get access to expensive advanced technologies. Visit the Alliance web site. Now, Western Michigan has joined the Alliance. Read more. Increasingly, we will see universities and colleges structuring new collaboration like the Alliance. These anchor investments will open new doors to economic development opportunities. posted by Ed | Resource: A good strategic plan from a small place Sometimes you find the good plans in the smallest places. Students who take my strategic planning class at the Economic Development Institute frequently ask me to show them good examples of strategic plans. In fact, I find more good examples in the UK than I do in the U.S. Now, here is an example of a good plan from Brandon, Manitoba -- about 215 km to the west of Winnipeg. You can read more about the planning process here. You can download a copy of the plan here. This plan is a good one, because it takes a big idea ("Where are we going?"), then draws a logical link between that big idea and strategic activities ("What will we do to get there?") and most importantly an action plan ("Who is going to do what by when?"). The plan is a little uneven. (Compare the environment section, for example, with the health section.) But it is a very good, clear effort and a strong model to follow. posted by Ed | Sacramento's green energy plans With high oil prices forecast for the foreseeable future, civic leaders in a wide range of regional economies are turning to the opportunities of "green energy". Here's a good example of a report out of Sacramento. Read more. posted by Ed | |
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