Going the Mega-Region Route for Economic Development

Richard Florida — he of The Rise of the Creative Class fame — is writing about economic development in a recent post at The Atlantic Cities. But we’re not talking about counties teaming up for business attraction and retention purposes.

Florida says satellite images of the globe at night were used to identify the world’s 40 “mega regions,” defined as a contiguous lighted area with more than one major city or metropolitan area that produced more than $100 billion in economic output.

In North America, this means 12 mega regions that account for 243 metropolitan areas in the U.S. and Canada. The combined population is 230 million people (215 million from the U.S., which account for 70% of our population).

The Chi-Pitts region, which includes Indianapolis, has a $2.3 trillion economic output that would make it the world’s seventh largest.

Here is a quick rundown on the 12 creatively-named regions, from largest to smallest:

•Bos-Wash stretches from Boston through New York, Philadelphia and Baltimore to Washington, D.C., a total of 500 miles. It is home to 18 percent of the U.S. population – 56.5 million people. The region generates $3.75 trillion in economic output, meaning that, if Bos-Wash were a separate country, it would be the fourth largest economy in the world, behind only the U.S., China, and Japan and ahead of Germany.

•Chi-Pitts extends north and west from Pittsburgh through Cleveland, Detroit, Indianapolis, Chicago, and Minneapolis, taking in more than 50 metros in all. Home to 41.8 million individuals, this mega-region’s economy is just a bit smaller than the United Kingdom’s, about the same size as Brazil’s and bigger than all of Russia’s.

•Char-lanta, which is home to 22 million people, takes in 45 metros, including Atlanta, Georgia; Raleigh, North Carolina; and Birmingham, Alabama. With more than a trillion in economic output, its economy is bigger that South Korea’s, placing it among the world’s 15 largest economies.

•So-Cal runs from L.A. through San Diego and spills into Tijuana, Mexico, accounting for 21.8 million people and more than one trillion in economic output.

•So-Flo includes Miami, Orlando and Tampa and is home to 15 million people. It produces more than $750 billion in economic output, making it about the same size as the Netherlands or Turkey.

•Nor-Cal includes San Francisco, San Jose, Oakland and 14 other metros surrounding San Francisco Bay. It has a population of 13 million people and produces more than $900 billion in output, roughly the same as Indonesia and more than Turkey.

•Tor-Buff-Chester stretches north from Buffalo and Rochester, taking in Toronto, Ottawa and Montreal in Canada. It has an estimated population of more than 16 million (several smaller Canadian metros are not included in this tally). It generates output of nearly $600 billion, more than Sweden.

•Dal-Austin encompasses Dallas, Austin, and San Antonio, Texas. Its population is just under 12 million. It produces more than $700 billion in economic output, more than Sweden or oil-rich Saudi Arabia.

•Hou-Orleans, the great energy-producing belt that stretches from Houston through Mobile, Alabama to New Orleans, is home to more than 10 million people. It produces more than $750 billion in economic output, about the same as the Netherlands.  (Some researchers have suggested combining Houston, Dallas-Ft. Worth and Austin into a single “Texas Triangle.” This mega would include 20 million people, and its $1.5 trillion economy would be comparable to Australia’s and just a bit smaller than India’s or Canada’s.)

•The Cascadia mega-region, which stretches up from Portland, Oregon through Seattle and into Vancouver, Canada, is home to nearly 10 million people. It generates economic output of about $600 billion, comparable to Switzerland

•Phoenix-Tucson is home to more than 5 million people and generates economic output of more than $250 billion, just slightly less than Hong Kong.

•Denver-Boulder has 4.2 million people and $256 billion in economic output, more than Finland, Greece or Ireland. If it were a nation, it would  rank among the world’s 50 largest economies.

Check Out the Chamber’s Issue Pages

Do you have a topic you're passionate about, and would like to know what the Indiana Chamber is working on in that area? We've developed some web pages highlighting key issues that will show you what we're focused on and offer some background on our public policies. See the pages below, and more information will be added weekly to these as the session progresses.

http://www.indianachamber.com/education
http://www.indianachamber.com/tax
http://www.indianachamber.com/healthcare
http://www.indianachamber.com/econdev
http://www.indianachamber.com/labor
http://www.indianachamber.com/environment
http://www.indianachamber.com/localgov
http://www.indianachamber.com/federal

Our 2013 Top Legislative Priorities and Legislative Business Issues documents are also available to view.

IUPUI Symposium Focus: Government and Economic Development

State Governments’ Role in the Economic Development of Advanced Manufacturing and Small Business. It’s an interesting proposition and the title of a September 28 event hosted by the Indiana University Robert H. McKinney School of Law on the IUPUI campus.

The Program on Law and State Government Symposium includes addresses from two program fellows and a series of panel discussions. The focus is on how law and policy intersect with economic development strategies and identifying potential solutions for growing the employment base of the industrial Midwest.

Additional details and registration information are available.

Members: Attend May 4 Policy Call on State of Economic Development

The economic development headlines evolve from, in simple terms, “getting new businesses to come to the state.” But the role of the Indiana Economic Development Corporation is also heavily focused on helping existing companies grow. It has a variety of initiatives, programs and strategies to accomplish both missions.

Indiana has fared better than most in the job creation game in recent years. What are the secrets to the state’s success? What are the biggest challenges to an even stronger performance? How can your company benefit from the state’s efforts?

Dan Hasler, Indiana’s secretary of commerce since September 2011, will join us to discuss these issues and more during our Policy Issue Conference Call on Friday, May 4 (9 – 10 a.m. EDT). It will be your opportunity to learn about the early impact of right-to-work, the competitive world of business attraction and much more. Your questions and comments are always welcome. This is for Indiana Chamber members only, and you can register online.

Columnist: It’s About More than Jobs

In the world of economic development, some say jobs are the measuring stick of success. While they are undoubtedly important, jobs cannot be the only measuring point when the ultimate goal is creating prosperous communities, according to Governing columnist William Fulton:

Here are the facts: The national radio show This American Life aired a segment in May on economic development, including a visit to a conference put on by the International Economic Development Council (IEDC). Because the show depicted the council and what it represents in such negative tones, long-time IEDC President Jeff Finkle wrote a lengthy letter of complaint, saying he felt like a guy who invited the show’s producers to a dinner party at his house, and then watched them insult the guests. Ira Glass, producer of This American Life, apologized for the segment’s snarkiness. In the end National Public Radio, which co-funds the show, apologized too.

All this was good copy, as we say in the newspaper business. In particular, Finkle deserves credit for successfully calling out the radio show for its highly negative story and eliciting an apology — something that almost never happens. But the whole controversy obscured one valid criticism of the profession: The way job creation is used as the first, last and only measure of success.

The problem, as the radio show correctly identified, is that there is enormous pressure on politicians and the economic development experts who work for them to take credit for jobs created — and, in some cases, jobs only supposedly created. Sometimes economic developers differentiate between good jobs and lousy jobs, mostly by looking at the hourly or annual wage scales of the jobs — but usually the headline simply telegraphs the number of jobs a state or locality has produced. As the radio show pointed out, at times politicians go to hilarious lengths to take credit, as when Missouri Gov. Jay Nixon held a press conference to celebrate the creation of eight jobs.

So in the same way that teachers are expected to deliver test scores rather than educated children, economic developers are expected to deliver jobs rather than prosperous communities. Hence the focus on poaching jobs from somebody else’s turf and the spotlight on poaching big companies rather than small ones.

As we all know, there’s far more to the economic development profession than jobs. Over the past 20 years, as smokestack-chasing has subsided, economic developers all across the country have done a great job of focusing on growing jobs locally rather than poaching them. But even this approach doesn’t really convey how economic development works. Ultimately, successful economic development can’t be measured only by the number of jobs or even the number of high-paying jobs that have been created.

Everybody needs a “job” in the sense that everybody needs a source of income capable of sustaining them. But prosperity today is so much more than providing everybody with a conventional job. Entrepreneurs need an entire ecosystem to support them — financiers, lawyers, strategists and a growing workforce. Communities need wealth retained in their hometown to endow their future needs.

Different types of people need different types of jobs — white collar, blue collar, professional, technical. As I wrote in this space in May, the next generation increasingly realizes that their future lies in the so-called “1099” economy, where temporary work is becoming the norm. They have no expectation of a traditional career path or even a traditional job.

These are the subtleties of economic development in the United States today that cannot be captured by measuring what we traditionally call “jobs.” They are measured by other things: venture capital available to local companies, skills in the workforce, the value of local philanthropic endowments, the number of startups (successful and unsuccessful) and overall household income.

The end result of all these activities is a prosperous community where people have money in their pocket and a commitment to spending it in a way that benefits both themselves and their hometown. Yes, sometimes this means smokestacks, and yes, most of the time it means jobs. But the underlying truth of that NPR segment is that there’s a difference between jobs and prosperity. If economic development is about nothing but jobs, then stealing jobs and taking credit for jobs that don’t exist will be the inevitable result.

Site Selecton Mag Recognizes Indiana for Economic Development Projects

Marion, Huntington, Angola, Seymour and Peru were recognized by Site Selection Magazine recently on its ranking of states by economic development projects.

For the sixth time since Site Selection Magazine began its Governor’s Cup rankings in 2003, Marion Indiana has made the list, this year as the ninth top Micropolitan in the United States. The magazine ranking of Top Micropolitans ranks cities of 10,000 to 50,000 within at least one county. Marion, Indiana was ranked among the nation’s 576 other Micropolitan areas.

This is Marion, Indiana’s second top ten ranking since 2003. It is the first Indiana Micropolitan community to make a top ten ranking twice. The Site Selection’s 2010 Governor’s Cup was published in the March 2011 issue of Site Selection Magazine and on their award-winning website http://www.siteselection.com.

The Grant County Economic Growth Council is a non-profit organization with the mission to facilitate investment and reinvestment for job creation and retention in Grant County.

You can view the Micropolitan rankings by clicking here.

You can view the Site Selection cover story here.

Planning Now for 2025

The Indiana Chamber is in the midst of a process titled Indiana Vision 2025. As the name suggests, it’s a long-range economic development planning process for the state. It will guide the Chamber’s advocacy efforts and hopefully help the state move forward, no matter which political party might be in power.

A task force of statewide business and organization leaders makes for fascinating discussion at each meeting. Last week’s focus on higher education took the dialgoue up a notch, with guest presentations from Nicole Smith of the Georgetown University Center on Education and the Workforce and Dewayne Matthews of the Lumina Foundation for Education.

Just a few of the many interesting highlights — ones that have to make you stop and think at least a little bit:

  • Each year of training (either formal college education or improving adult skills in some way) leads to a 3% to 6% increase in gross domestic product
  • When surveyed, 85% of eighth-graders and their parents state the young people plan to go to college. The actual number, of course, is far lower
  • In 1973, 28% of jobs required at least some college education or better. In 2018, that number is projected to be 63%
  • Low skill jobs that paid high wages are largely gone — and not coming back. "For the first time, the only way to get into the middle class is through education"
  • In Indiana, 735,000 working-age adults have attended college but don’t have a degree

Like I said, just a few numbers and perspectives. Look for much, much more in the months ahead.

Have a Question for Mitch Roob? Here’s Your Chance

Mitch Roob’s job is to sell Indiana. He does it in all corners of the state, from coast to coast and on a global basis. Roob will slow down for an hour on Friday to participate in the Indiana Chamber’s Policy Conference Call.

It’s a members-only event, and it’s your opportunity to ask a question or make a comment to Indiana’s Secretary of Commerce. I’m looking forward to leading the discussion and have plenty of topics planned. Among them: foreign trade missions, the balance between attracting new companies and assisting existing businesses, legislative priorities and much more.

It should be a good one. Join us on Friday. Register here.

Economic Development in Southern Indiana

Jim Plump of the South Central Indiana Economic Development Group discusses ongoing projects and the status of the region with our very own Tom Schuman on Inside INdiana Business:

I also wrote an article on this topic in the latest edition of BizVoice that you might find useful if you’re interested in Southern Indiana, which, in addition to being one of the most beautiful parts of the country — in this observer’s opinion — also may have a very bright economic future.

Idaho Getting Creative With Energy Solutions, Tapping into “Back End” Infrastructure

Today’s riddle: When can a good idea also stink? Ag Weekly has the answer:

That odor wafting from 550,000 cows that make up Idaho’s growing dairy herd smells like energy independence and economic development to state energy czar Paul Kjellander.

Idaho is now America’s No. 3 milk producer, trailing California and Wisconsin. That also means it’s cow pie central.

Mountains of manure are fueling Kjellander’s dream of pipelines crisscrossing the Snake River plain, linking manure digesters at dairies large and small to central refineries that produce natural gas pure enough for homes or cars. Processed manure would be sold as plant bedding. Dairies could also fire turbines, shooting electricity into the power grid. And they could sell carbon credits in schemes to slash greenhouse gas emissions.

Kjellander, who heads up Gov. C.L. “Butch” Otter’s Office of Energy Resources, is pushing a package of income tax credits, property tax waivers and other incentives in the 2009 Legislature starting Jan. 12 to transform Idaho’s southern heartland into a methane Mecca.

I was amused that the author used the phrase "cow pie central" when referring to Idaho. I believe that is also the name of the least popular train station of all time.