Large employers are a mixed blessing for a local economy. Though able to ignite exponential growth, their failure results in equally powerful decline.
Delaware Online identified five characteristics of this process, using DuPont – which at one point employed 10 percent of Delawareans – as a case study.
- Decline is slow, so warning signs are hard to identify.
- Restaurants and retailers are the first to suffer.
- The highly educated are the first to leave, since they can find employment elsewhere.
- Home prices fall.
- Mass exodus creates and a vicious cycle which discourages new residents from moving in.
Location consultant and economic development marketer Janet Ady draws four lessons from the article.
- Never take a primary employer for granted. Maintain regular communication so the company knows it is valued.
- Always be diversifying, even when the primary employer is doing well.
- Try to grow the company’s local supply chain to strengthen its connections to the region.
- Partner with local universities to kick start new industries.
Kodak helped make Rochester, N.Y., an economic dynamo, but the company today is a shadow of its former self. No longer able to compete as a camera maker, the company’s two-square-mile Eastman Business Park could have very easily became a liability for the city. But Kodak, with help from the city and state, is acting as a sort ofstartup landlord, renting space to 58 diverse companies (Associated Press). The park’s advanced infrastructure and laboratories, coupled with the city’s legacy workforce,enabled recent wins, including LiDestri Food and Beverage and several battery companies (Industry Week).
This year, Rochester secured the location of the Integrated Photonics Institute for Manufacturing Innovation, which includes a $110 million startup grant from the Department of Defense (Democrat and Chronicle). To ensure benefit for local jobseekers, the Rochester Institute of Technology is revamping curriculum to cater to the coming photonics industry (Democrat and Chronicle).