Toledo's ED Future Still Up for Grabs

Toledo and Lucas County, Ohio officials continue to debate how they should reorganize city and county ED efforts.

Meanwhile, the area's economy continues to sag.

Hopefully there will be some resolution to this issue very shortly and hopefully a real results-oriented public-private partnership results from all these debates.

More here.

More on Call Centers.

Call centers won't disappear overnight, but the industry's days of expansion appear over, Datamonitor said. About 50,600 U.S. call centers now employ 2.9 million people. Datamonitor expects those totals to dwindle to 47,500 call centers with 2.7 million employees by 2008.

Read the article here.

Puerto Rico's Economy

I ran across an interesting article about Puerto Rico's economy. Some big issues discussed, such as whether PR should once again seek statehood.

Click here to read it.

Dallas Puts Brakes on Big Boxes

Dallas puts the brakes on unwanted development by issuing building moratoriums more often than many of its peers – the result, some officials say, of an ill-defined strategy for planning the city's future.

When City Council members halted construction of "big-box" stores north of Interstate 30 two weeks ago, it was the fifth moratorium they have imposed since last year – and the fourth since February.

Critics of the practice say it discourages economic development and inhibits the growth of tax revenue at a time when every tax dollar counts. Proponents say it provides city officials with a last resort to protect Dallas neighborhoods.

More here.

Museums, Historical Sites, Other Related Attractions

Many communities are giving attention to museum and historic site development to spur tourism and economic development. The 2002 Economic Census has just released its report on this industry. Interesting reading!

Get it here.

U.S. Statistical Abstracts

Did you know that the Census Bureau has statistical abstracts that go back to 1878?

You can download them off the Census website.

Really interesting stuff!

Fetch them here.

Call Center Changes in the Making

This is not new news, but important news for communities that depend upon call center. The initial story centered on South Florida, but the underlying trend is important for many places to pay attention to.

Call centers won't disappear overnight, but the industry's days of expansion appear over, Datamonitor said.

About 50,600 U.S. call centers now employ 2.9 million people. Datamonitor expects those totals to dwindle to 47,500 call centers with 2.7 million employees by 2008.

Many of the jobs will move to lower-wage countries such as Canada, India, the Philippines and Mexico. While the typical American call center worker makes $10 an hour, the average wage for the same job in India is $1.20 an hour, Datamonitor analyst Mark Best said.

Large companies such as Microsoft and Dell already route customer service calls to India.

More here.

Here's An Interesting One!

Associated Press, St. Louis — A nonprofit pro-business organization has fired a longtime consultant who made $1.4 million advising it on leadership and other matters but claimed to be a psychic and clairvoyant.

Richard Fleming, chief of the St. Louis Regional Chamber and Growth Association, told media outlets this week that the economic-development organization severed its seven-year ties with David Levin after learning Levin had begun melding his psychic beliefs with his consulting.

Fleming said that while RCGA officials knew 64-year-old Levin was "spiritual," word of his claims to have supernatural powers became a credibility issue.

In background information it supplied to The Associated Press, the RCGA said it parted ways with Levin on Sunday "due to consultant's decision to present his work and firm in ways inconsistent with RCGA's role in the St. Louis community."

Fleming did not return telephone messages Thursday, and Levin did not respond to telephone and e-mailed requests for an interview.

Levin's claims of being clairvoyant were made public when the Colorado man alleged in the September editions of the British magazine Prediction that he, his wife and their 15-year-old son all are psychic.

According to the article, titled "A Psychic Family," Levin launched a consulting business for "high-profile business executives" in 1982. Fleming, the story suggests, met Levin in 1993, not long before Fleming was tapped in August 1994 as the RCGA's president and chief executive.

More here.

Presidents and Prosperity

This is an election, right? Lots of crap and baloney about who has and who can do what. What do the real numbers say about how well the R's and D's have done in advancing prosperity? Check out this article by Fortune Magazine. Very interesting data! Go here. I won't spoil it for you.

Some Good Advice on Poverty, Profits, and Development

Reducing poverty is one of the things economic development is supposed to do. Right? Here is some interesting advice on this idea.

“If we stop thinking of the poor as victims or as a burden and start recognising them as resilient and creative entrepreneurs and value-conscious consumers, a whole new world of opportunity will open up.”

That “simple proposition” begins a controversial new management book that seems destined to be read not just in boardrooms but also in government offices. “The Fortune at the Bottom of the Pyramid. Eradicating Poverty Through Profits” (Wharton School Publishing), is essentially a rallying cry for big business to put serving the world's 5 billion or so poorest people at the heart of their profit-making strategies.

It has already been praised by everyone from Bill Gates—“a blueprint for fighting poverty”—to a former American secretary of state, Madeleine Albright—“if you are looking for fresh thinking about emerging markets, your search is ended.”

More here.

Business Capital Spending Up

Here is a little good news for economic development.

After two consecutive years of declines, capital spending by companies in the S&P 500-stock index is expected to turn positive for 2004, says Standard & Poor's. The 500 companies will post a year-over-year spending rise of 5.53%, according to S&P.

Capital expenditures for the first quarter of 2004 vs. the first quarter of 2003 increased 5.36%, S&P says. This was the first quarter-over-quarter increase since the fourth quarter of 2001. Spending for the second quarter of 2004 vs. the second of quarter of 2003 is also running higher, at 5.73%. Historically, 32% of the expenditures are made during the first six months of the year, with the third quarter accounting for 29% and the fourth quarter 39%.

More here.

Virginia Plans India Trade Mission

The Virginia Economic Development Partnership is sponsoring its first trade mission to India this winter to encourage exports to the fast-growing country.

Though India has become known in recent years as a place American technology and service firms have gone to outsource jobs, the country's growing wealth also creates opportunities for exports from Virginia, the partnership said.

Telecommunications equipment, education services, computers, and electrical power, pollution control, medical and mining equipment were some of the areas where opportunity exists, the partnership said.

Virginia's exports to India in the first five months of 2004 were $25 million, a 148 percent increase over the same period in 2003. The partnership hopes to build further on that trend.

More here.

University of Arizona Partners with Mexico

We have been tracking partnerships in economic development. Here is an example from the University of Arizona in Tucson, which has its students working on optical technology plans with Mexico's leading researchers.

This is a great example of how higher education can be a fulcrum for national and global economic development partnership development.

More here.

California Increases Gambling Market Share

A state once skeptical of wagering is in the midst of a gambling boom that could double casino revenue in coming years. In time, according to gambling industry officials and economists, California almost surely will pass Nevada as the nation's biggest gambling venue.

What was a trickle became a flood after ballot propositions in 1998 and 2000 successfully pitched Indian gambling as a road toward economic independence for tribes. Now, the state has more than 60,000 slot machines, the most lucrative game for any casino owner, and tribal casinos generate roughly $5 billion to $6 billion annually.

For now, California's gambling industry remains considerably smaller than Nevada's, which has 220,000 slots and generates more than $9 billion in annual revenue.

More here.

Indiana Updating Statewide Strategy

The Indiana Economic Development Council (IEDC) is working on an update to its 1999 Breakaway Strategic Plan. The plan will be delivered to the Indiana Legislature in December.

More here.

Keep This One in Mind

"Top executives should rate their subordinates on loyalty and competence. Those who are more loyal than competent should be fired because they are the dangerous ones. They will stay forever while other more competent, less loyal people will jump ship as problems develop.
And the loyal, noncompetent subordinates will “protect” their bosses from the truth. Reality will be too threatening and ugly. When truth dies, really bad things happen."

--Shapiro, Slywotzky and Tedlow

Rural Water and Economic Development

Water issues are coming up on our radar screen in some of the rural economic development strategic planning efforts we are working. Those of you wrestling with these issues may find a recent USDA article on rural water to beof interest.

Rural areas and small towns can derive significant economic benefits from building new water and wastewater plants that assure an adequate supply of clean water. A study of grants from the U.S. Department of Commerce's Economic Development Administration (EDA) to local development projects found that investment in water and sewer facilities paid large economic dividends to the grant recipients, generally communities in economic distress.

A recent USDA Economic Research Service analysis of data from the EDA study shows that rural communities derived sizeable economic benefits from water and sewer projects, including an increase in available jobs, more private investments, and a rise in property tax bases.

See the article, Economic Impact of Water/Sewer Facilities in Rural and Urban Communities, for more information.

Smarth Growth Has Fiscal and Competitive Advantages

Fiscal issues are popping up right and left in my strategic planning work for economic development. For those of you looking for ways to cope with the hard-nosed fiscal and competitive realities facing communities, you may find this Brookings Institute article on smart growth policy impacts to be of interest. Here is a summary.

With the collapse of the 1990s stock market bubble and several years of national economic slowdown, a tense new climate of austerity has sharpened debates over government spending, economic development, and the physical growth of states and metropolitan areas.

Leaders in this environment are eager for fiscally prudent ways to simultaneously support their communities and stimulate their economies.

This paper makes the case that more compact development patterns and investing in projects to improve urban cores would save taxpayers' money and improve regions' overall economic performance. To that end, it relies on a review of the best academic empirical literature to weigh the extent to which a new way of thinking about growth and development can benefit governments, businesses, and regions during these fiscally stressed times.

Overall, the review finds that:

The cost of providing public infrastructure and delivering services can be reduced through thoughtful design and planning. Several studies suggest that rational use of more compact development patterns from 2000 to 2025 promise the following sorts of savings for governments nationwide: 11 percent, or $110 billion, from 25-year road-building costs; 6 percent, or $12.6 billion, from 25-year water and sewer costs; and roughly 3 percent, or $4 billion, for annual operations and service delivery. School-construction savings are somewhat less.

Regional economic performance is enhanced when areas are developed with community benefits and the promotion of vital urban centers in mind. Studies show that productivity and overall economic performance may be improved to the extent compact, mixed-use development fosters dense labor markets, vibrant urban centers, efficient transportation systems, and a high "quality-of-place." Productivity increases with county employment density. Communities that practice growth management realize improved personal income shares over time.

Suburbs also benefit from investment in healthy urban cores. Finally, studies suggest that to the extent these smarter development patterns foster equity in regions by improving center-city incomes and vitality, they will also enhance the economic well-being of the suburbs as well as the city. City income growth has been shown to increase suburban income, house prices, and population. Reduced city poverty rates have also been associated with metropolitan income growth.

In the end, this paper makes the case that during times of tight budgets, more efficient and beneficial growth strategies make more sense than ever.

As these strategies become more widespread, the challenge for the research community will be to move beyond the obvious fiscal savings and continue to quantify the profound effects on economic competitiveness, equity, and quality of life available through better planning and community design. In the end, these issues are at the crux of what better development is really all about.

Download brief here.

New Brookings Analysis on Offshoring and Imports

Here is a summary of a recent analysis of the job impacts of offshoring, imports, and productivity growth. As we suspected, productivity, our long courted friend, has dealt the greatest blow to employment. I wouldn't let offshoring off the hook just quite yet.

Until the end of 2003, the United States had been experiencing a "jobless" recovery, with employment stagnating at levels well below those in 2000. A widespread perception has arisen that a major culprit behind the dearth of jobs was the growing practice of U.S. firms to relocate part of their domestic operations to lower-wage countries abroad. "Offshoring" presumably caused a reduction in U.S. output and a corresponding loss of jobs.

In fact, after the 2001 recession, U.S. domestic production rose substantially, but output per worker—productivity—jumped so sharply that instead of rising, employment declined. That is the real cause of the jobless recovery. Had GDP growth been accompanied by a continuation of earlier rates of productivity growth, there would have been some 2 million more private sector jobs than there were at the end of 2003.

When firms send work overseas, those goods or services come back in the form of imports. But a careful look at U.S. import data—especially for service imports, where most offshoring growth occurred—indicates that while the total number of jobs affected by offshoring had increased, that number was still small relative to the millions of jobs affected by the productivity surprise.

Download the brief here.

Singapore's Manufacturing Plans

Singapore says it hopes to double manufacturing output in 15 years as regional competition heats up from lower-cost rivals such as fast-growing China and India.

Manufacturing accounts for about a quarter of Singapore's gross domestic product - equivalent to about 40 billion Singapore dollars (US$23.5 billion; euro 19 billion) last year.

Can they make it? This is far from a done deal for Singapore. China will be tough.

Read more here.

Partnership Metrics for Economic Development

ED organizations tend to have many partnerships. That is what our new national survey of EDO's reflects.

How do you measure the value of partnerships? That is the question for the day for partnering ED organizations. Here is a resource that can help: Measuring the Value of Partnering: How to Use Metrics to Plan, Develop, and Implement Successful Alliances, by Larraine Segil. Learn more about the book here.

How does one accurately measure an alliance? With all the factors involved — productivity, decision making, team performance, the number of new customers, and damage control — getting a precise measurement can be a complex and daunting task. Knowing which measurement to use, and at what stage of the alliance life cycle, is critical.

Measuring the Value of Partnering gives readers a system for measuring a relationship's contribution at every stage of the alliance, from creation to implementation to termination. This essential book features case studies drawn from interviews with key players at companies like IBM, Hewlett-Packard, Starbucks, Staples, and Hyundai. Weaving these and other real-life examples together, Author Larraine Segil helps readers develop the appropriate metrics and then shows how and when to use them accurately and intelligently to achieve the greatest impact. Timely and practical, Measuring the Value of Partnering provides the tools for making any alliance is work to maximum organizational advantage.

Bringing New Ideas to Life

Organizations struggle all the time with how to develop and apply new ideas. ED organizations struggle with this issue too. I see it all the time. How can your organization succeed as an innovator? Click here for some practical advice on how to bring new ideas into being.

Knowledge-Hoarding

In this age of knowledge, is it possible that people in organizations "hoard" knowledge? Yes indeed it is true.

It's also true that people are reluctant to share knowledge between and among organizations belonging to the same network. This is a problem in economic development. It inhibits regional collaboration for economic development. Think about it.

Despite the many initiatives launched to decrease information-overload, increase teamwork, and facilitate knowledge-sharing, many organizations still find themselves stymied by cultures where knowledge-hoarding and "each man out for himself" behaviors flourish.

While some of the programs designed to help turn out to be more costly than valuable, it's also true that hoarding, failing to share credit, and the lack of skillful communication and true teamwork also have high costs. What's a leader to do?

You might want to start by reading Jamie S. Walters' excellent article on this subject.

Technological University of the Philippines

How about a little global insight? How does the Philippines do what it does economically/ Not by brawn, but by brain...

From its humble beginning as a trade school, the Technological University of the Philippines has indeed gone far to attain its present stature. Today, almost 103 years later, the TUP has grown many times over in terms of students, faculty and staff population including the offering of curricula ranging from a diverse technological and industrial education programs starting from the technical to the doctoral level of education. With its myriad feats through the years, its “trade school” image has truly been transformed into a dynamic premier state university of technology.

More here.

Pittsburgh Technology Council Spreads Its Wings

Check out this article and look at where the Pittsburgh Technology Council is headed. Pay special attention to its growing network of partnerships and relationships--something I have been pushing for sometime. Click here.

Hamilton, Ontario Turnaround

Despite signs of decay, Hamilton may be on the verge of a turnaround, with new jobs and cheap real estate luring more and more Torontonians to "Steeltown".

After steadily losing its share of the provincial population to the booming Toronto region, Hamilton is growing again. Planners expect its half-million population to approach 600,000 by 2021 as a steady drip of new jobs compensates for the losses at the steel mills -- and as the city's attractive west-end neighbourhoods fill up with newcomers commuting to Mississauga, Brampton and Oakville. The westward drift of growth out of Toronto is an unstoppable tide, they insist; Hamilton's biggest problem will be finding enough space.

And once again, enter the manufacturing versus high tech jobs debate...

"Hamilton does not seem to realize that it's down and out," downtown businessman Brian Owen complained to The Hamilton Spectator. "We have a very serious problem here, but until the politicians and city bureaucrats get to the point where they realize it and admit it, they won't really be able to deal with it."

But that's not the way they see it. Hamilton has lost jobs since the 1980s, according to economic development officer Neil Everson. But now, he said, it is back on a solid growth path. "In Hamilton today, high-tech and health care employ more than steel," he said. The city's largest employer is the Hamilton Health Sciences Corporation, with 9,200 employees in three hospitals.

Neil Everson is a long-time ED friend. Good luck Neil. I wish you well.

More here.

Michigan Debates Future ED Focus

Here is a quote from a commentary article in the Detroit News this morning. It essentially says that Michigan should stop giving so much attention to manufacturing job retention.

"The steep decline in manufacturing jobs is Topic A in discussions about the future of Michigan’s economy. There is widespread concern that without robust manufacturing companies, our economy will be increasingly dominated by low-wage service-providing industries. Also, many people think the large loss of good-paying manufacturing jobs will depress the economy.

It turns out that these fears are greatly exaggerated, if not unwarranted. In our new report, “A New Path to Prosperity?,” we find that knowledge-based industries do better than manufacturing as an engine of economic growth. The knowledge-based jobs are in industries where work is largely done in offices, schools and hospitals."

What do you think? The easy out is to say "do both." That may be. How much of state and local resources should be committed to both? Should the the Big Three automakers continue to get the big handouts they have been receiving? This is a familiar debate in many places where I'm doing strategy work: Pennsylvania, Ohio, Indiana, and elsewhere.

Read the full article here and download the study by Donald Grimes and Lou Glazier here. Interesting debate shaping up in Michigan.