Month: October 2016

From Whittaker and Associates: Revitalize Small-Town America by Focusing on the Future of Work

By Dean Whittaker

What incentives would you offer to a company that would create 50 jobs with an average pay of $80,000 per year? What if I told you that it would cost you nothing? It sounds too good to be true, right? Actually, these jobs/workers are already in your community. They are called “freelancers,” and they are the invisible workforce that earns their living by selling their knowledge and expertise.   Some offer their services locally, but many perform services on a global basis bringing money into the community from outside the area. These primary income generators often go unseen and are not part of the traditional economic development metrics of jobs and investment.

According to research commissioned by the Freelancers Union, as of 2014, there are already 53 million Americans who are freelancing, earning more than $715 billion a year. This is a significant economic impact.

How can you help create, nurture, and support this economic engine? The care and feeding of the ecosystem to support these individuals comes at little or no cost to the taxpayers. According to the UpWork survey of freelancers, they want freedom, flexibility, connectivity (both virtual and real), community, a safe place to work outside their home, and affordable benefits including health insurance and retirement programs.

Small and rural towns have an advantage of a sense of community, little or no traffic (one of the major frustration of large cities), a less stressful and slower pace, easy access to nature, parks, and recreation, access to education through on-line learning, and a people-focused life style. Remember, in this new economy, knowledge work moves, and people stay put.

To attract these technologically-enabled nomads, look to existing relationships. How are they already connected to your community through friends and family? Look for life-moments like marriage, the birth of child, and aging parents that would cause them to consider a move back to your area. Use social media to connect and recruit alumni. Facebook and others have become powerful marketing tools.

What if your community sponsored training workshops on common needs of freelancers? How could you assist them in marketing their product or services?
How about a “freelancers” appreciation night to acknowledge their contribution?

Look around you. How many people do you know that work from their homes or local coffee shops on a full or part-time basis? In our 24×7, “always on” culture, we all work everywhere. What contribution are freelancers making to the prosperity of your community?

Note: If you’re interested to learn more about this topic from an entrepreneur and freelancer’s perspective, check out this for-pay webinar recording that was hosted on September 30 by Whittaker Associates for the Pro Learning Lab’s educational series.

IEDC: In placemaking, formerly subversive “street art” delivers visible public value

By Robert Pillow, IEDC intern, University of Arkansas

Economic developers increasingly recognize the value in building a sense of place. The arts are a particularly potent placemaking tool, and that includes formerly disdained “street art.”

Popularized by Britain’s Banksy, street art – when properly sanctioned – is a form of expression that the entire community can enjoy. Not only does street art serve as a substitute for graffiti, but it can also express the spirit of a community for all to see on buildings and infrastructure. Once sanctioned, street art essentially becomes another form of public art.

Although harnessing street art for public benefit is not without its challenges. Shepard Fairey, one of the most famous “stencilists,” was commissioned by Quicken Loans chairman and real estate mogul Dan Gilbert to paint an 18-story mural on one of his buildings in downtown Detroit. But Fairey decided to make the most of his time in a new city and began “tagging” other buildings without authorization and was arrested (Detroit Free Press).

Still, street art continues to enter the mainstream, and more public agencies fund underground artists to depict their visions legally in public spaces. After all, the tradeoff for placing restrictions on such iconoclasts is the expectation that public funds will underwrite these projects.

Some U.S. municipalities attach percent-for-art rules to capital improvement projects to create a dedicated funding stream for artwork on or near a development (Project for Public Spaces). Other funding sources include taxes on hotels or casinos, lottery revenue, grants, TIF revenue, or general purpose funds. Sometimes, developers will underwrite street art as public amenities on private property.

Regardless of funding source, community support is vital. Although art is intrinsically valuable, it is important to make the case for the project’s contribution to the public good, e.g., through increased property values, tourism, backdrops for events and festivals, marketing tools, etc.

IEDC: When the last grocery store closes, cooperatives can step in

By Robert Pillow, IEDC intern, University of Arkansas

As more small-town grocers go under, rural Americans face food insecurity along with stretched budgets and commutes. High operating costs and competition from national chains are forcing sole proprietors to innovate. Grocers are experimenting with various forms of cooperatives (co-ops), which can work well for rural communities.

In a webinar hosted by the U.S. Department of Agriculture, Dr. David Procter of Kansas State University’s Rural Grocery Initiative and Marnie Thompson with the Fund for Democratic Communities discussed cooperative management models and best practices.

Whether maintaining an existing store or launching a new venture, it is important to choose the right model for the community. An interesting strategy, and one that requires regional thinking, is a purchasing co-op, in which multiple stores leverage their purchasing power to buy in bulk for lower prices. Of course, rural grocery stores are dispersed by nature, but those within reasonable distance can coordinate on larger orders and thereby lower their overhead.

  • The co-op concept applies to ownership as well. Thompson stressed four key characteristics of any successful co-op: community support, a business plan, experienced management, and sound financing.
  • The most important step is to amass community support; without a grassroots effort and widespread buy-in, the project will die on the vine. Neither is it likely to succeed if the project’s champion comes from outside of the community. Forging links to local farmers or community groups may increase community interest.
  • Just because a co-op doesn’t look like a traditional business doesn’t mean it can go without a traditional business plan. Any sustainable co-op requires a rigorous plan with budget projections, as well as purchasing and sales estimates.
  • Sound management also is critical. Though hiring a local manager would be a great bonus, it is more important to hire someone with experience. The Renaissance Community Co-op in Greensboro, North Carolina, hired an experienced manager a full year before opening.

It’s not uncommon for a grocery store to operate a full year before returning a profit, which is why stable financing is so important. Cooperatives rely on community members literally buying into the concept, but they also typically rely on loans and grants from local, state, and federal sources, as well as community development financial institutions. The Greensboro co-op secured low-interest loans to be paid back only through profits, which allowed the store to establish itself without a looming debt obligation.

Source: Click here.

New York Times: A Simple Equation … More Education = More Income

Don Iannone’s Take: If there is any question of whether education pays off in terms of earnings, read this NY Times article. I hear the banter in Ashtabula County and elsewhere that not everybody needs or wants a college degree and there are plenty of good-paying jobs that don’t require a degree. This is only partially true today and in the future will be much less true. Get an education! Educate yourself. The range and quality of your career and life options will expand exponentially.

The Times article: Imagine if the United States government taxed the nation’s one-percenters so that their post-tax share of the nation’s income remained at 10 percent, roughly where it was in 1979. If the excess money were distributed equally among the rest of the population, in 2012 every family below that very top tier would have gotten a $7,105 check.

This is hardly trivial money. But it pales compared to the gap between the wages of a family of two college graduates and a family of high school graduates. Between 1979 and 2012, that gap grew by some $30,000, after inflation.

This clever calculation by Lawrence Katz, a labor economist from Harvard, amounts to a powerful counterargument to anybody who doubts the importance of education in the battle against the nation’s entrenched inequality.

But in the American education system, inequality is winning, gumming up the mobility that broad-based prosperity requires. On Tuesday, theOrganization for Economic Cooperation and Development released its annual collection of education statistics from around the industrialized world showing that the United States trails nearly all other industrialized nations when it comes to educational equality.

Read more here.

October 2016 Ashtabula County Jobs Report (Based upon August 2016 data)

Ashtabula County resident employment averaged 42,000 in August 2016, about the same level of average employment as 2010. However, employment showed stronger and more consistent growth in 2016 than in previous years and it reached an annual job creation rate of 300 (Not Seasonally Adjusted) in August 2016. The current labor force average was 44,700, about 5,600 lower than 2007. The rate of labor force contraction has slowed since mid-2014 and the labor force has grown slightly in 2016. The unemployment picture has improved over the past several years as the number of unemployed has dropped to under 3,000 and the unemployment rate has decreased to just over 6%. Unfortunately, the unemployment rate improvement has primarily been due to labor force contraction, rather than employment growth.

The Bureau of Labor Statistics provides monthly estimates of resident employment (16 years & older) & unemployed residents seeking employment. The twelve-month moving average of employment in the county decreased from 46,600 in 2007 to 41,900 in 2010 and has remained close to that level during the national economic recovery. However, the volatile “not seasonally adjusted” employment estimate for Aug 2016 increased to 42,782, about 300 better than Aug 2015. The consistent employment growth in 2016 has begun to affect average employment.

The labor force includes all persons at least 16 years old with a job or seeking a job, and excludes persons in the military or institutionalized. In Ashtabula County, the labor force has decreased from 50,000 in 2007 to 44,600 in mid 2016, a loss of 5,400. The recession may have accelerated the contraction and the weak recovery led to some discouraged workers who stopped efforts to gain employment. The county’s labor force has been contracting for a decade, but the rate of loss has slowed since late 2014. The labor force has grown slightly in 2016.

Unemployment includes persons who are currently jobless, available for work and actively seeking a job in the past four weeks. A jobless person not seeking work is not considered part of the labor force and not counted as unemployed. As of Aug 2016, 2,700 were considered unemployed in Ashtabula County. The post-recession decrease of 4,000 in unemployment would normally be regarded as a favorable occurrence, but nearly the same number stopped actively seeking work.

Download the report here.

Economic Developers and Sustainability Directors Find Common Ground

By David Leezer for IEDC Now

More than fifty representatives of the Urban Sustainability Directors Network (USDN) and the International Economic Development Council participated in the first-ever Sustainable Economic Development Convening, held in conjunction with IEDC’s Annual Conference in Cleveland, Ohio.

“The discussions and collaboration experienced at the convening is an exciting and important new development for both professions,” said Della Rucker, CEcD, AICP, chair of IEDC’s Sustainability Advisory Committee.  “This is the first time leaders from both sectors came together to enhance local economies’ sustainable actions steps.”

Representing 23 American and Canadian communities, participants spent a day and a half discussing strategies for economic developers and sustainability officers to work collaboratively, and settled on a shared definition of “sustainable economic development.” USDN is a peer-to-peer network of local government professionals across the United States and Canada dedicated to creating a healthier environment, economic prosperity, and increased social equity. Facilitating the discussion was the Institute for Conservation Leadership, a nonprofit organization committed to working with conservation organizations, leaders, coalitions, and networks.

Words matter

One of the first “Aha!” moments was the realization that, because both groups rarely interact, there was a gap in understanding between each profession’s language. Very quickly, attendees realized that words matter, and gaining an understanding of each group’s communication standards and jargon was step one. Establishing shared language is especially important so that both groups can talk to the private sector about sustainability issues in a language that business owners will understand.

At first, it was a challenge to define sustainable economic development in a way that resonated with the entire group. Participants went through three periods of discussion and rewriting of a proposed definition. This dialogue resulted in the following definition which most participants agreed upon:

“The investment in business, social, built, and natural environments that creates increasing prosperity for all, now and into the future.”

Creative collaboration

David Gilford, former vice president and director of Urban Innovation and Sustainability for the New York City Economic Development Corporation, spoke during Friday’s plenary session about sustainability efforts in New York. One strategy that was especially impactful, and replicable in communities of any size, was open data – because it allows a wider demographic to contribute to sustainability solutions. New York City facilitated this by hosting the Big Apps Gathering, an annual competition using data to find new opportunities to promote city well-being. “Be open to ideas on the outside,” Gilford advised. He challenged attendees to consider some strategies as they return to their communities, including:

  • Define sustainable economic development in a way that resonates with a broad audience.
  • Agree on sustainability metrics for today and in the years ahead.
  • Bring new and diverse funding sources to existing sustainability programs.
  • Maximize the chances for creative collusions.
  • Bring new voices into the sustainable economic development conversation.
  • Find partners in unexpected places.
  • Travel together with people from your own city to resolve differences.

Participants discussed “creative collaborations” several times following his speech. This is a concept that encourages organization to regularly interact, during happy hours or other social events, with departments and disciplines outside of their own. These informal settings encourage conversations that may lead to ideas on how to work together. Attendees saw this as an opportunity to break down the silos between the economic development and sustainability departments, which are typically housed in different divisions, and sometimes entirely different buildings.

Promising programs and metrics

After hearing presentations from economic development leaders in Cleveland, Vancouver, and Boulder, Colorado, it became clear that sustainable economic development strategies are not “one size fits all.”  However, each program highlighted two important lessons. First, it is best to start small, rather than rolling out big, ambitious initiatives all at once. Second, it is impossible for one organization to implement effective programs. Sustainable economic development requires partnerships and community engagement.

On the second day, participants broke into sub-groups to discuss efforts under way in their own communities. This included discussions about:

For the final discussion, the convening focused on metrics that communities can use to quantify their green economies. During this session, representatives from Vancouver shared information about their data-driven approach; attendees from Iowa City shared how their community underwent STAR certification, a green-rating program for municipal governments; and the Cleveland delegation discussed how their Sustainable Cleveland online dashboard keeps them informed and accountable.

IEDC’s Sustainability Advisory Committee came away with a renewed commitment to educate IEDC members and share best practices through 2017 and beyond. Overall, the convening demonstrated that economic development and sustainability can co-exist, and both groups can contribute to measureable results, greater prosperity, and a cleaner environment.

IEDC: The Latest on Inclusive Growth

By Louise Anderson and Eli Dile, International Economic Development Council

Since the Great Recession ended in 2009, the United States has experienced one of the longest economic growth cycles in its history. Yet for many Americans, the years since have not been kind. In communities across the country, some residents are thriving while others experience declining household incomes, low labor force participation and increasingly concentrated poverty, trends that often have been in place for years. Individuals may face barriers to prosperity due to low education and skill levels, lack of transportation or child care, persistent discrimination, or other reasons.

The issue of economic opportunity is one of increasing concern to economic developers, both because it hinders their ability to improve their economies and because they have an important role to play in potential solutions.

IEDC and its Economic Development Research Partners program have taken on this issue in a new research paper, “Opportunity for All: Strategies for Inclusive Economic Development” (PDF). Released at IEDC’s 2016 Annual Conference in Cleveland last month, the report explores evidence and consequences of economic inequality, defines “inclusive economic development,” and contains nine case studies showcasing EDO-led programs that are promoting opportunity in their communities. Complementing the release of the report was a full slate of breakout sessions and keynote speakers that both underscored what is at stake and discussed best practices.

A moral and economic imperative

“It’s not just inequality. In and of itself, inequality is something you expect,” said Angela Glover Blackwell at Monday’s plenary session. Glover Blackwell is CEO of PolicyLink, an Oakland, California-based nonprofit that researches and advocates for economic and social equality. “It is toxic inequality that has hollowed out the middle class and is stalling economic mobility.”

If the United States achieved equality in wages for women and minorities, she explained, GDP would be $2.1 trillion higher. In Cleveland alone, this would amount to $13 billion. Therefore, Glover Blackwell concluded, “Equity is the superior growth model.”

She also cited a study by the Federal Reserve Bank of Cleveland which found that a 10 percent decrease in inequality would lead to a 50 percent increase in economic growth for the region. She mentioned Cleveland’s Evergreen Cooperatives as a promising local program for other communities to emulate. (More information on the Evergreen Cooperatives is included in the case study section of the report.)

Economic developers: The “face of opportunity”

“Often, economic growth is confused with economic development. Growth and disparity can coexist. Do our strategies target the full spectrum of residents?”asked Anne Roise, CEcD, MCP, of Savannah State University, who moderated a session titled “Addressing Economic Inequalities in Your Community.”

“If we don’t close that gap, there are going to be significant ramifications. And there already have been ramifications,” said Jonathan Morgan of the University of North Carolina-Chapel Hill, citing unrest in suburban St. Louis, Baltimore, and most recently in Charlotte. Morgan went on to discuss some equity-centric policies that are gaining traction, such as community benefits agreements, local minimum wage ordinances, and local- and minority-owned business contracting quotas for governments and anchor institutions.

Clarence Anthony was one of those minority business owners who got a leg up from municipal contracting policies. Now the executive director of the National League of Cities, Anthony reminded economic developers at Monday’s plenary session of the immense influence they hold over the lives of millions of people.

“Parts of our cities are not living the American dream. You are the face of opportunity in cities throughout America,” Anthony said.

King County, Washington, is one place that has embedded equity throughout its governing structure. It is guided by the King County Equity and Social Justice Strategic Plan, a six-year plan that has led to demonstrable outcomes. For example, to encourage upward mobility, the county mandates that its lowest-paid public employees attend professional development courses. Matias Valenzuela, director of the county’s Office of Equity and Social Justice, explained that by explicitly laying out goals and objectives, the plan influences public spending decisions by giving the county’s budget committee a compass by which to operate. Another new policy inspired by the plan is ORCA LIFT, a reduced-fare program for Seattle’s low-income bus riders.

“Be explicit about making it a priority,” Jonathan Morgan said. “Embed it deep in your work. Without that, it’s not likely to happen.”

Getting started

“Opportunity for All” was presented to a standing-room-only crowd. The session featured a panel of representatives from five of the EDOs featured in the report’s case studies. The session led to a lively discussion on what others are doing to fight inequality in their communities. One common challenge expressed by attendees was a lack of “soft skills;” many unemployed and underemployed individuals lack basic knowledge of what to wear to an interview or how to behave in the workplace. This was one priority item all EDOs should have on their radar screens, attendees agreed.

Though every community faces unique equity challenges, the paper identifies several things that economic developers can do to help:

  • Understand the state of economic inclusion in your community.
  • Focus on the business case and economic impact of inclusion.
  • Tie inclusion initiatives to growing sectors, clusters or industries.
  • Involve target populations, when appropriate, in the research and planning of inclusion initiatives.
  • Harness the purchasing and employment power of anchor institutions.
  • Examine the state of inclusion within your own organization.
  • Take a broad look at the work that needs to be done.
  • Accept the charge of convener, catalyst or gap-filler when appropriate.

In sum, the economic development profession now faces a new challenge: Disparity in incomes and opportunity is rising, and not only does it harm the quality of life for many of our communities’ residents, but it is increasingly recognized as harming the economy as well. The goal of “Opportunity for All” is to provide practical information to economic developers by offering a snapshot of a range of initiatives, across different community sizes and locations, that public and private EDOs have undertaken.

Ultimately, to bring economic opportunity to all, economic developers must continue to “learn from others – innovate, be creative, and take risks,” said Jonathan Morgan. “And don’t forget to measure results.”

Small city “town hall” sheds light on what works in rural development

By Rob Pillow and Eli Dile, IEDC Now

One of the more interactive sessions during IEDC’s Annual Conference is the Town Hall series, which convenes economic developers of similar community sizes in an open forum to discuss challenges and share success stories. The smallest session is for communities with less than 25,000 residents; this event engendered a lively discussion of small city and rural development best practices. Ellen Huber, CEcD, of the City of Mandan, N.D., moderated the discussion.

BRE: For many small communities, business retention and expansion (BRE) is the lifeblood of their economic development efforts. Those in attendance agreed that BRE should avoid the common pitfall of focusing too much on external issues, such as parking availability, visibility, or marketing. This may cause surveyors to miss some of the core, internal issues facing a business, such as poor management, a negative work environment, or communication gaps.

One economic developer from Hamilton County, Ohio, shared that his office brings a business coach on BRE visits to provide advice on modernizing operations. He was careful to point out that coaches never tell a business owner what to do outright, but instead offers suggestions. To supplant outdated, “home-grown” business practices, coaches can offer modern business development strategies including management training, soft skill workshops, accounting, etc.

Ellen Huber noted that one of Mandan’s BRE surveys found a perception among the local business that the EDO was only concerned with recruitment. This revelation helped underscore the importance of business appreciation events, a practice many in attendance conduct, whether it be for a day, week, or month.

Entrepreneurship & small business: The low-hanging fruit of small business growth is to get them to stay open later and on more days. This was an area of shared frustration among economic developers, as many main street businesses choose to stay closed at peak times (especially Sundays).

To finance startups, one new and growing technique is equity investing. This form of crowdfunding allows members of the community to buy a small amount of equity in a potential business to defray initial startup costs. Instead of a bank or the business owner assuming all of the risk, it is spread out among a network of local investors. This not only overcomes barriers to capital access, but it also involves the wider community in the success of the business, creating a sense of local pride.

Succession planning is another key element of small business assistance. Many rural business owners are graying out and may not have a relative interested in taking over. Helping train managers or local entrepreneurs to take over an important local business should be a tool in every rural practitioner’s toolbox, participants agreed.

Marketing & attraction: Huber related that when she began working in Mandan, the city’s marketing budget was $0. However, she was able to raise $17,000 by engaging with the parks department and school district. Social media was one of the most cost-effective ways to communicate their “Made in Mandan” campaign, Huber said.

For many small communities, restaurants (franchises or home-grown) are high-priority targets. Not only do they improve quality of life, but they serve as useful amenities in attracting businesses and residents. (No site selector, CEO, or millennial wants to drive to the next town over to get a decent meal.) Mandan offers a 1 percent local sales tax rebate to new or expanding restaurants for five years. Providing this incentive to existing restaurants was an important consideration to make sure existing businesses didn’t feel slighted.

One big issue on everybody’s mind: broadband Internet. For those present, broadband is quickly going from the wish list to a necessity. An economic developer from Hudson, Ohio, said business leaders told him flat out that they would relocate unless they got high-speed Internet. It’s been a year since Hudson rolled out a broadband network for the city’s businesses parks and select neighborhoods, and the town of 22,000 intends to scale up next year, aiming to connect people’s homes as well (Crains Cleveland).