Ontario Releases New Economic Competitiveness Report

From the report: "Ontarians need to rebalance our economic priorities and policies by investing more today if we want to achieve our full economic potential and prosperity in the future." That is the conclusion of Rebalancing priorities for prosperity, the Fourth Annual Report of the Task Force on Competitiveness, Productivity and Economic Progress in its Fourth Annual Report, released today at the MaRS Centre in Toronto.

Ontario has built one of the most successful economies in the world, but the Task Force’s report demonstrates that Ontario has a widening prosperity gap with its peer group of North American jurisdictions. The key to closing this prosperity gap, the Task Force argues, is higher productivity – the increased capability of Ontarians to add more value to the physical, human, and capital resources in the province. But to achieve this Ontarians need to choose a different path than the one we’re on – rebalancing priorities to increase investment for the future and decrease current consumption.

Download the report here: http://www.competeprosper.ca/task/ar2005.pdf

New Indian Congress Head Works Toward Unification

When Joe Garcia became governor of the San Juan Pueblo Indian village in New Mexico earlier this year, he revived a community initiative to drop the name the Spaniards gave the tribe centuries ago. Garcia now boasts he heads the Ohkay Owingeh, or place of the strong people.

Garcia, 52, brings that kind of emphasis on tribal culture and history to his new role as president of the National Congress of American Indians. Elected this month at the group's annual convention in Tulsa, Okla., Garcia says he wants to focus on safeguarding tribal traditions and building unity among the country's 587 tribes.

Read more here.

Canada Funds Indigenous Communities

Canada just pledged $4.3 billion in a landmark deal with Indian and northern Inuit communities to help lift them from the poverty and disease that has plagued their neglected reserves for more than a century.

The agreement commits federal funding over the next decade for widespread improvements in housing, health care, education and economic development for the nearly 1 million aboriginal peoples of the North American nation, namely Indian tribes known as First Nations and Inuits, the aboriginal Canadians of the northeastern and Arctic territories.

Read more here.

ED Organizations and How They Relate

Maybe there are some ideas in this story from Manyworlds.com for ED organizations.

"To conduct business with customers, suppliers, partners and other external parties, companies have three options: arm’s-length, socially embedded and virtually embedded ties. Arm’s-length ties are connections that exist solely for a particular business transaction. The problem with arm’s-length ties is that they have difficulty handling transactions that are uncertain, complex or opportunistic.

Embedded ties are connections that overcome the weaknesses of arm’s-length ties by inserting the transaction in a supportive context, either social or virtual. With a socially embedded tie, trust, sharing of proprietary information and joint problem solving form the foundation for an economic relationship to minimize the risk of transactions.

In a virtually embedded tie, an economic relationship is facilitated and maintained through the use of electronic technologies that help minimize the risk of transactions through increased transparency, widespread information sharing and community-based problem solving. Companies in different environments are likely to benefit from the use of different combinations of those types of connections."

Source: Manyworlds

Roanoke Gets Tech City Award

Nestled among the low-tech mountains, Roanoke is officially a high-tech city. The highest-tech for its size, in fact -- so says the Center for Digital Government, which ranked Roanoke number one in its category for the fourth time in five years.

Big Lick beat Denton, Texas (Bonnie and Clyde's neck of the woods); Ogden City, Utah; and Harry Truman's Independence, Mo., among other cities in the 75,000 to 124,999 population category. And it found itself in the company of Corpus Christi, Texas; Madison, Wis.; and Delray Beach, Fla. -- all winners for their size.

Read more here.

Happy Thanksgiving

I would like to take this opportunity to thank all ED Futures readers for allowing us to engage you in a meaningful dialogue about the trends and issues that are shaping our work and our world.

May the blessings of Thanksgiving touch you on this special day that reminds us of the importance of gratitude in our lives.

From Australia: Don't Count Out Older Talent

Forget focusing on young go-getters keen to climb the corporate ladder - businesses are being urged to value older workers in a project aimed at capitalising on the state's ageing population. South Australia is trialling a national project - Valuing Older Workers - that encourages employers to attract and retain mature-age employees.

Read more here.

The truth is we need both. Economic development needs an inter-generational model to guide its efforts in the future.

Pollution Holds Back Chinese Economic Development

The Chinese government's decision to cut potentially contaminated freshwater supplies to one of China's major cities has highlighted the threat that industrial pollution poses to public health and economic development across the nation.

Almost four million people in the northeastern city of Harbin, in Heilongjiang Province, are expected to be without running water until late Saturday after a chemical plant explosion contaminated the upper reaches of the nearby Songhua River with toxic benzene.

Read more here.

Book Review: Leadership on the Line

Leadership on the Line
Staying Alive through the Dangers of Leading
By Ronald A. Heifetz and Marty Linsky

Leadership isn’t easy. The best leaders force their followers to face unpleasant realities and then figure out the solutions for themselves. That’s why leadership is so risky, argue Ronald A. Heifetz and Marty Linsky in this engaging tome.

The authors analyze the successes and failures of leaders ranging from Yitzhak Rabin to Bill Clinton, with stops along the way to examine the leadership styles of former Coca-Cola CEO M. Douglas Ivester and NBA coach Phil Jackson. At times, the authors’ rules of thumb seem too general. Yet, their real-world examples blend well with their leadership theory to present a useful guide.

“To lead is tolive dangerously because when leadership counts, when you lead people through difficult change, you challenge what people hold dear – their daily habits, tools, loyalties and ways of thinking – with nothing more to offer than perhaps a possibility.” Leading is an inherently risky pursuit. True leaders pose difficult questions and demand change of their followers, and change is never easy.

Change means abandoning established ways of acting and thinking. In the political realm, change can menace deeply held values and beliefs. Change means someone loses something. Therefore, even those whom a leader is counting on to enact change feel threatened by it. Those who have a stake in inertia or old patterns erect all kinds of roadblocks to thwart a change-minded leader and, as a result, many leaders fail to implement worthy ideas. A leader who is going to triumph must not only possess vision and courage, but must also know what obstacles will arise and how to surmount them.

The book's key points are these:

• The best leaders pose difficult questions and demand change of their followers. Change is never easy.
• It's an old saw that people resist change; in fact, they resist loss.
• Leaders need not only courage and vision, but also the knowledge of how others will resist them and the skill to overcome that resistance.
• Resistance to change can become marginalization, diversion, attack or seduction.
• Organizations may fight change in obvious ways, but more often resistance is subtle.
• Groups that oppose reform-minded leaders often try to overwhelm them with issues that aren't part of the leaders' agendas.
• Challenges take two forms: technical issues, which can be solved by changing processes, and adaptive issues, which can be resolved only by overhauling priorities.
• Leaders who lose touch with their constituents risk failure, no matter how sound their judgment is on other matters.
• Effective leaders value personal relationships above all else.
• Leaders know that sometimes it's best to force their followers to resolve conflicts.

Buy the book at Amazon.com.

GM Cuts May Be Too Late, Is Bankruptcy in the Cards?

Shares in General Motors have fallen more than 3% as analysts remain sceptical of a turnaround at the loss making car maker. Despite the firm axeing 30,000 manufacturing jobs and closing 12 plants in North America, many feel GM will struggle to avoid bankruptcy.

The job cuts at GM are expected to hit consumer confidence as people worry that secure jobs that offer good pension and healthcare benefits are becoming harder to find.

"Hope is diminished, the future is unclear and communities are less stable," said the United Auto Workers union. GM's cuts will hit communities across the US, not just in its home state of Michigan.

Read more here.

GDP Growth Despite All That's Happened...Really?

This comes as a surprise to many of us. I hope that NABE is right, but I wonder about this one. I looked for more of a ding in the US economy's armour in the last quarter of this year. Read on.

Despite turbulence from hurricanes and high energy prices, the economy is expected to log respectable growth this year and next, business economists say. The economy, as measured by gross domestic product, is projected to grow by 3.6 percent for all of 2005 and 3.3 percent in 2006, according to the National Association for Business Economics.

Against this backdrop of the economy's resiliency, the Federal Reserve is likely to continue boosting short-term interest rates well into next year to keep a lid on inflation, Tannenbaum said.

The new estimate for GDP growth in 2005 is slightly higher than a NABE projection released in September, while the fresh estimate for 2006 is slightly lower. GDP measures the value of all goods and services produced within the United States.

Read more about the NABE forecast here.

GM's Loss = Toyota's Gain

I said it two weeks ago, and sure enough it's true. I better stop making predictions.

GM has been the world's largest automaker since 1931, but Toyota Motor Corp. looks to claim that crown as early as next year as it continues to grow in the softening U.S. auto market as well as in Asia, Europe and South America.

Toyota didn't introduce its first car in the U.S. — a pokey four-door sedan called the Toyopet Crown — until 1958. Four-and-a-half decades later, the Tokyo-based company has plants in 27 countries, sells cars in more than 170 nations and is ramping up production worldwide.

As GM tries to win customers with deep discounts, Toyota is raising prices on some models. Unlike GM, the Japanese automaker is winning market share by making quality vehicles that people want to buy.

The situation casts a blinding spotlight on the changes sweeping through the once-insular U.S. auto industry, which is now shaped largely by global competition."We are seeing a confrontation between the old and the new," said David Cole, director of the Center for Automotive Research in Ann Arbor, Mich.

More here.

GM: 30,000 Jobs Gone by 2008

To stay alive, 10% of General Motors workforce must die. We saw the cuts coming, but didn't know just how bad it would be. I keep wondering how many of these jobs will shift offshore over the next couple years.

Here's the story broken earlier this morning.

General Motors Corp. will eliminate 30,000 jobs and close nine North American assembly, stamping and powertrain plants by 2008 as part of an effort to get production in line with demand and position the world's biggest automaker to start making money again after absorbing nearly $4 billion in losses so far this year.

The announcement Monday by Rick Wagoner, GM's chairman and CEO, represents 5,000 more job cuts than the 25,000 that the automaker had previously indicated it planned to cut. United Auto Workers union leaders called the cuts "extremely disappointing, unfair and unfortunate.''
The 30,000 job cuts represent about 9 percent of GM's global workforce of about 325,000 people.

GM said assembly plants will close in Oklahoma City, Lansing, Mich., Doraville, Ga., and Ontario, Canada. GM also listed Spring Hill, Tenn., as a plant closing even though one production line will remain open there. A shift also will be removed at a plant in Moraine, Ohio.

An engine facility in Flint, Mich., will close, along with a separate powertrain facility in Ontario and metal centers in Lansing and Pittsburgh.

Wagoner said GM also will close three service and parts operations facilities. They are in Ypsilanti, Mich., and Portland, Ore. One other site will to be announced later.

Read more here.

Gulf Coast Update: Businesses Try to Decide to Stay of Go

To rebuild or relocate is a dilemma facing many small-business owners along the hurricane-damaged Gulf Coast. It's an especially difficult choice for minority entrepreneurs. Their businesses, concentrated in the service and retail industries, were hit disproportionately hard, and community leaders worry their loss could threaten minority employment and unravel the social fabric of neighborhoods in the Gulf.

More here.

GM to Shutter Four More Plants

More bad news from the sagging auto industry.

GM Chief Executive Rick Wagoner will announce plans this week to close four U.S. assembly plants, the Automotive News industry paper reported today, citing a "company insider."

It said the move was part of an effort by the world's biggest carmaker to quiet Wall Street speculation about a possible bankruptcy.

It quoted its source as saying the planned cutbacks would come in a "bold announcement" that should "cause a lot of people to shut up."

GM was not immediately available for comment. It has lost nearly $4 billion this year and has said it will give details by the end of 2005 of its plan to cut at least 25,000 manufacturing jobs as part of a broader restructuring plan.

Who might get nailed in this move?

Some experts believe The Lansing Craft Center, where GM builds the Chevrolet SSR, will likely be shut down because the convertible sport pickup has not sold very well and GM has idled the plant for several months in 2005.

Two other plants likely to be shut down are the Doraville, Georgia, plant, which builds GM's minivans, and an SUV plant in Janesville, Wisconsin, analysts said.

The new plant closures will add to three assembly plants that GM has already closed or stopped production at this year -- a car plant in Lansing, Michigan, an SUV plant in Linden, New Jersey, and a van plant in Baltimore.

Organic Foods Continue to Gain Traction

A new survey says Americans are buying more organic food, but that higher prices have slowed the growth of that market.

According to the annual 2005 Whole Foods Market Inc. Organic Trend Tracker, nearly two-thirds of Americans have tried organic foods and beverages, jumping from just over half in both 2003 and 2004, and 27 percent of respondents say they consume more organic foods and beverages than they did one year ago.

Ten percent consume organic foods several times per week, up from just seven percent last year.

Americans are buying organic foods and beverages for a variety of reasons. The top three are: avoidance of pesticides, freshness, and health and nutrition.

More than half buy organic foods to avoid genetically modified products.

Also, more than half of all respondents agree that organic foods and beverages are "better for my health" and better for the environment.

"Organic foods continue to move into the mainstream, and more Americans are choosing organic foods as part of a lifestyle aimed at wellness," says Margaret Wittenberg, vice president of communications and quality standards at Whole Foods Market.

But, the main barrier to consumers going organic continues to be price.

Almost three-quarters of respondents said the price of organic food and beverages is the main reason for not consuming more.

Other reasons Americans are not consuming more organics, according to the survey, include: availability and loyalty to non-organic brands.

Source: http://www.bizjournals.com

ED Futures Newsletter, November 20, 2005

Dear ED Futures Readers:

Let me start by thanking those of you who sent emails and called me about the lead article in the last issue on the global automotive industry. It is fair to say that this is an industry of deep interest to you. For that reason, my message resonated with many of you.

Some asked: "What can we do about the situation? If there is an alternative to the zero-sum game approach to the auto sector, what is it?" Click on this link and download an article I wrote last year. Perhaps it will provide you with a new way to think about future strategies for working with companies in the auto sector.

We don't pay enough attention to the future, especially to our children and the future world we are giving shape to through our economic development policies and strategies. I have been thinking a lot about how economic development can be practiced with an "inter-generational" view of the world in mind. Last year I wrote a very popular article for the U.S. Department of Labor on why we need a new approach to enabling youth and young adults to succeed in a changing economy. You can download a copy of the article here. Your comments would be very much appreciated.

This has been another busy week at ED Futures. Here are a few articles from this week you may want to at least scan for ideas:

Voices and Choices in Northeast Ohio. (Innovative project to engage citizens about their economic future.)

Important Economic Development Resources You Should Know About. (Because you asked for it.)

Economic Development Reading List for Beginners. (Because you asked for it. Sorry it took a while to pull together the reading list.)

Target Industry: Magazine Publishing. (If Santa Fe and other places can do it, maybe your area can.)

Automotive: Misery Loves Company. (More on the topic of what's happening in the global auto industry, and it isn't good.)

Target Industry: Aircraft Parts Manufacturing. (Is this industry important to your area?)

Nissan Tennessee: $155,000 Per Job! (Is it worth it? You tell me. I'm all ears.)

Target Industry: Electronic Components and Semiconductors (Is this industry important to your area?)

ED Futures Sign-Up Link (Tell your friends.)

As always, keep those cards and letters coming.

I wish each of you a warm and happy Thanksgiving Holiday, and may God smile down upon you and your family with blessings of gratitude and hope.

Best wishes,

Don Iannone
ED Futures Publisher
Tel: 440.449.0753
Email: dtia@don-iannone.com

Pay Attention: Personal Bankruptcy Rate Up

From the St. Louis Federal Reserve Bank: "As evidence of our growing bankruptcy culture, personal bankruptcy filings in the United States increased from 1.2 per 1,000 people in 1980 to over 5.4 per 1,000 people last year, an increase of nearly 350 percent.1 In terms of annual growth, personal bankruptcy filings per 1,000 people have been growing at an average rate of nearly 7 percent, about 1.5 times greater than the average rate of annual per capita GDP growth."

These statistics, however, disguise the fact that personal bankruptcy filings are not equal across the country. For example, at the state level, Tennessee had the highest rate of personal bankruptcy filings in the nation, with over 10 filings per 1,000 persons last year—nearly twice the U.S. rate—whereas Massachusetts ranked last with 2.8 filings per 1,000 people."

The rise and spread of casino gambling since the early 1990s also has been considered to be responsible, in part, for the rise in bankruptcies. However, the research on casino gambling and personal bankruptcy is mixed. The research that does find a positive effect of casino gambling on bankruptcy rates usually finds that this effect is localized and very small—much smaller than the effect from the aforementioned factors.

Read more here.

Interesting state ranking data here.

From Fresno: Brain Drain Hurting Us

Does this sound familar in your area?

Young people with good educations are leaving the struggling southern San Joaquin Valley in a search for better prospects elsewhere.

Although the Fresno metropolitan area is growing as newcomers take advantage of comparatively low housing prices, the region lost one-sixth of its young, single college graduates between 1995 and 2000, according to a U.S. Census Bureau analysis released last year.

Nationally, the only places that lost more young graduates were either dying Rust Belt cities or college towns, whose job it is to export the educated. In comparison, the Greater Los Angeles area saw that same demographic grow by almost 10%, while it jumped nearly 20% in the San Francisco Bay Area.

But it's not just young people who are leaving. A 2004 report by the Public Policy Institute of California shows that the loss of educated residents in the southern San Joaquin Valley cuts across all ages. Of the adults leaving the five-county area for other parts of California, 24% had college degrees, according to the study, but only 15% of those entering the region from elsewhere in the state had the same education level. In addition, much of region's growth comes from immigration; many of those new residents have low education levels, which intensifies the brain drain's effect.

Read more here.

More Bad News from Ford

Ford Motor Co. will cut another 4,000 white-collar jobs in North American by early next year as part of a painful restructuring that will be announced in January. The automaker has already eliminated nearly 3,000 white-collar jobs since the spring through layoffs and voluntary departures.

So much for "knowledge jobs surviving!

Stay tuned.

Read more.