One of the coolest economic development programs I've ever seen: Biddeford's Main Street Challenge

by Christa Franzi 20. January 2015 09:33

 

There are some very cool economic development programs out there…

 

From incubators in public schools to experiential learning opportunities in manufacturing, but my favorite one to date is the City of Biddeford, ME's Main Street Challenge. Who doesn't love a good competition? Think Shark Tank but instead of wads of cash from wealthy entrepreneurs, three winners receive a package of goods and services worth over $20,000 from the local business community and the public sector.

 

The Biddeford Main Street Challenge is designed to provide entrepreneurial businesses a head start during the most challenging year of operation (year-1), encourage existing businesses interested in opening an additional or expanded storefront to consider Biddeford, fill empty downtown storefronts, and create a "buzz" to promote Biddeford as a great place to open a business. The challenge includes three phases:

 

Phase 1:

Written business concept pitch (2-pages)

Phase 2:

Around 10 of the best concepts are chosen to attend a day of training and submit a full business plan.

Phase 3:

About 6 businesses are chosen to present their business plans and ideas to a committee, who chooses 3 grand prize winners.

 

These grand-prize packages are no joke. They are purposefully designed to help entrepreneurs turn their ideas into reality. Prizes include:

 

  • Forgivable Loan of $10,000 from the City
  • 4-months free lease in a downtown storefront
  • 2-hours of free architecture design work
  • Free Chamber membership and advertising at the Amtrak station
  • 3-hours of free legal services
  • 1-year free phone and internet
  • 1-3 page custom website
  • And more…

 

The prizes are awesome, but the coolest thing about this program is how Biddeford's business community and public sector organizations rallied together to make this program work. There is definitely a local philosophy of "if you success, we all succeed" and it's working. The Main Street Challenge was held twice - in 2012 and 2014 - and winning startup businesses like Dahlia’s Delights, Elements, and Tote Road are helping to strengthen the local economy and reinvigorate Biddeford's downtown. Check out the Heart of Biddeford's website to learn more about the Main Street Challenge.

 

 We love hearing about great economic development programs that are providing real results. Tell us about your favorite! 

 

 

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Featured Indicator: The Labor Force Participation Rate

by Tom Dworetsky 19. January 2015 21:40

The labor force participation rate (LFPR) in the U.S. continues to fall. In December 2014 it reached 62.7%, down from 66.0%, where it stood in December 2007 before the Great Recession. While three percentage points might not seem like much, there is no denying that the LFPR is on a downward trend.

 

The labor force participation rate is the proportion of the labor force (those either employed, or unemployed and actively looking for a job) as a percentage of the total civilian non-institutional population ages 16 and over. The simple definition is that it is a measure of the percent of people in the labor force.

 

A look at this graph from the St. Louis Fed shows its trajectory since 1948. The LFPR rises sharply between the mid-1960s and 1990. This surge was largely a result of women entering the workforce in unprecedented numbers. It then fluctuates but continues to increase slightly through about 2000. It peaks in January of 2000 at 67.3%, and then begins its descent to where it sits today. The last time to LFPR was this low was in 1978.

 

There are several factors that are contributing to the shrinking workforce, a subject of ongoing debate among economists. Some of these factors are demographic, while others are a result of economic conditions. Here are two major factors:

  • The Aging Population – The Baby Boomers make up a large share of the total population. As this group begins to retire, the LFPR will continue to be driven downward.

  • The Weak Economy – The number of employed Americans fell dramatically during the recession, but the other component of the labor force—the unemployed— also fell. Many potential workers opted to stay in school or return to school, while others became discouraged and simply stopped looking for work altogether.

 

Why Does This Matter?

What’s important to note here is that while some portion of the falling labor force participation rate can be explained by retiring baby boomers, higher rates of college attendance, and other demographic and social trends—that is, people who (in most cases) voluntarily elect to stop working—another portion is a direct result of high joblessness. People who are jobless but have stopped looking for work are not included in the unemployment rate, even if they would like to work if the opportunity arose. The sharply declining LFPR is a strong indication of how significant this portion of the population might be. One estimate puts this number at 2 to 4 million—that’s a full 1 to 2% of the civilian population 16 and over that is no longer part of the labor force. It remains to be seen how long the LFPR will continue to fall, and what this will mean for our economy.

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The Disconnect between Education and Workforce Development, Part II: The Workforce Investment Act

by Colleen LaRose 19. January 2015 17:59

In continuing our series on Workforce Development, this article builds on November’s topic—The Disconnect between Education and Workforce Development—and explains what modern workforce legislation has done to address this problem. The first piece of legislation, the Workforce Investment Act (WIA), was implemented under the Clinton Administration, and will be the topic of this month’s article. Next month, we will discuss the latest in workforce legislation, the 2014 Workforce Innovation and Opportunity Act (WIOA)

 

The modern system of workforce development was shepherded in under the administration of Bill Clinton in 1998. The legislation that was passed was called the “Workforce Investment Act” and was truly revolutionary in how it determined that workers would be matched for available employment opportunities, and trained if necessary to meet the demands of local businesses.

 

The first thing that was revolutionary about this legislation was the establishment of state and local “workforce investment boards” to oversee and be accountable for how local, state, and federal funds were being expended in the name of employment and training. The boards also required the majority of membership on these boards to be employers to assure that employment and training decisions being made were market-driven.

 

The second part of the legislation that was revolutionary was the establishment of the “One Stop Career Center system” in which multiple programs that helped people find employment were required to begin working proactively together. The multiple programs mandated to work together as a system included:

  • Programs funded by the Department of Labor and accountable to the WIBs through their oversight of One Stop operations

  • Adult Education

  • Postsecondary Vocational Education

  • Vocational Rehabilitation

  • Title V of the Older Americans Act

  • Trade Adjustment Assistance

  • Veterans Employment and Training Programs

  • Community Services Block Grant

  • Department of Housing and Urban Development

  • Unemployment Insurance

  • Job Corps

  • Bureau of Apprenticeship and Training

The programs “accountable to the WIBs through their oversight of One Stop Operations include adult (adults with low incomes), dislocated worker (those recently separated from their employment), and youth programs (career awareness and preparation for both in school and out of school young people). Another revolutionary step from WIA was the establishment of benchmarks of accountability for these three programs. These benchmarks of accountability became to be known as “the common measures” and for adult and dislocated workers measured the effectiveness of training programs by measuring how many of the trainees were able to find work (entered employment), how many were able to keep their job for six months or more (employment retention), and what the increase in wages has been since acquiring employment with their new skills (wage increase). Similarly for youth programs, measures of accountability for training programs are whether the youth was able to enter either an employment situation or was able to access additional levels of education/training, whether they were able to increase their numeracy and/or literacy skills, and whether or not they were able to attain a degree or certificate.

 

This was pretty good legislation and was able to continue operating with relative success for more than 15 years. However, there were some major problems with WIA.

  • WIA was severely underfunded. It frustrates me that these services were slashed when they were needed more than ever due to the need to skill up the workforce to be competitive globally. The direct result is that this put the US behind where it should have been in the global marketplace. The peak of funding for workforce development programs was in 1979. In real dollars, funding for workforce development dropped by 70%, with the most severe withdrawal of funding of more than 12% coming under the Bush Administration from 2000 to 2007.

     

  •  The focus of the legislation was on helping people get a job first, with training being seen as a “last-ditch effort” to get the person employed. While it seemed like a good idea at the time, this philosophy of “work first” has, over time, lead to a lower skilled workforce at a time when more and more technical skills are required in all industries around the globe.

     

  • The “work-first” philosophy was especially damaging to low-skilled, low-income, and youth populations who were largely “dumped” into service industry jobs with little career growth opportunities.

 

Some other problems with WIA legislation were:

  • Workforce development initiatives were not actively coordinated with economic development

  • Workforce development maintained a social service mentality and was not proactive in supporting business

  • Innovative workforce development programming was largely grant driven, which meant that when the grant dried up, so did the initiative. This also meant that workforce systems spent much of their time chasing dollars for specific initiatives and would change strategies as new funding opportunities became available.

  • Lack alignment (local, regional, state, federal) of strategic planning priorities

  • Changing priorities with new administrations

  • Boards too big and ineffective

  • Silos of service – not leveraging resources and collaborating as needed between system partners

  • Training delivered that did not result in employment

  • Reactive not proactive (too tied up with red tape)

  • Best practices not widely shared, little to no training for WIBs other than legislation rules.

  • Not supportive of entrepreneurship

  • Wagner Peyser funding largely run by those in Civil servant positions who are not “motivated” to change or improve services

  • Need more on-the-job training (OJT) and apprenticeship

 

So, while WIA was most definitely a giant step ahead of JTPA and its predecessors, it still needed some tweaking. So, on July 22, 2014, new workforce legislation was signed into law called the Workforce Innovation and Opportunity Act (WIOA). Stay tuned for more on WIOA next month!

 

Unlike most legislation the goes through Congress in a painful and controversial way, WIOA was instead passed with huge bipartisan support. It was pretty clear what needed to be fixed from WIA and how to fix it (but that is not to say that the fixes will be easy).

 

Without getting too deep into the weeds about this legislation, suffice it to say that WIOA:

  • Strategically aligns and promotes coordination of key programs in employment, education, and training at fed, state, regional and local levels through American Job Centers (former One Stop Career Centers), These programs, Wagner Peyser, adult education and vocational rehabilitation and former WIA programs (adult, dislocated worker and youth programs) are now required to co-locate, share resources, utilize integrated intake and reporting systems, and all of these programs will now be subject to reporting outcome measures (such as credential attainment, entered employment, employment retention and wage gains).

  • All training providers must report on outcomes of students, promoting accountability and transparency of training programs and those seeking training are not forced into “work first” before training is considered as an option.

  • Builds on proven best practices such as sector strategies, career pathways, regional economic development approaches, and work-based learning (such as apprenticeships and on-the-job training) and incumbent worker training.

  • It requires four-year state plans be submitted to the Federal Department of Labor with two-year updates (first report due March 2016). Local plans must align with state plans and must include: strategic planning elements, operational planning elements, operating systems and policies, program specific requirements, implementation strategy, and assurances

  • There will now be enhanced employer services, employer satisfaction surveys, and benchmarks of performance (yet to be determined) in how well employer needs are being met by the American Job Centers

  • And, last but not least, my favorite part of the legislation, WIOA fosters collaboration of regional economic development with workforce development initiatives, which has been my mantra for these many years! In fact, the Obama administration has put out a report called: “Ready to Work: Job Driven Training and Opportunity” that clearly outlines seven principles under which both workforce development and economic development must now operate…cooperatively. Briefly, these principles are:

ENGAGING EMPLOYERS – Work up-front with employers to determine local hiring needs, design training programs that are responsive to those needs – from which employers will hire.

EARN AND LEARN – Offer work-based learning opportunities with employers – including on-the-job training, internships, pre-apprenticeships and Registered Apprenticeships – as training paths to employment.

SMART CHOICES – Make better use of data to drive accountability, inform what programs are offered and what is taught, and offer user-friendly information for job seekers to choose programs and pathways that work for them and are likely to result in jobs.

MEASUREMENT MATTERS – Measure and evaluate employment and earnings outcomes. Knowing the outcomes of individual job-driven training programs – how many people become and stay employed and what they earn – is important both to help job seekers decide what training to pursue and to help programs continuously adjust to improve outcomes.

STEPPING STONES – Promote a seamless progression from one educational stepping stone to another, and across work-based training and education, so individuals’ efforts result in progress. Individuals should have the opportunity to progress in their careers by obtaining new training and credentials.

OPENING DOORS – Break down barriers to accessing job-driven training and hiring for any American who is willing to work, including access to supportive services and relevant guidance. In order for training programs to work, they need to be accessible for the people who need them most.

REGIONAL PARTNERSHIPS – Coordinate American Job Centers, local employers, education and training providers, economic development agencies, and other public and private entities to make the most of limited resources.

 

In fact, the report says: “EDA will include job-driven training principles in its new CEDS content guidelines, which provide recommendations and tools to help regions develop strong CEDS. These new content guidelines will be released in fall of 2014 and will be available to the over 380 current regional planning organizations as they implement and update their CEDS as well as to any community looking to develop an impactful economic development strategy for its region.”

 

Translation: every Comprehensive Economic Development Strategic plan (CEDS) is going to have to include these job driven principles. So economic development is now going to have to include workforce development in planning goals and strategies for their region if they are going to utilize CEDS funding from the EDA. This is BIG STUFF!

 

Now, is this WIOA legislation a panacea? No, of course not…in fact there are many concerns about how to accomplish the goals of this legislation…how to get the parties to work together collaboratively (like economic development and workforce development), how to make sure there is enough funding to assure that the goals established in a local region have a prayer of being accomplished, how to get other organizations, such as higher education, aligned to the goals established by the local region when it does not represent a large financial stake for them, how to get the “mandated partners” of the American job Centers to co-locate and share resources….and lots of other concerns. BUT, that all being said, this legislation is definitely another leap forward in the evolution of workforce development programming and we will undoubtedly be revisiting this in a few years with another needed update. However, in the meantime, let’s make the most of this opportunity and take that bipartisan spirit to heart in each of our local regions and make every effort to embrace this new opportunity to work together to improve the workforce of the USA.

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How Economic Developers Can Learn From Non-Profit Organizations

by Rachel Selsky 19. January 2015 17:56

A few years ago I was looking to get more involved in my community and for an opportunity to meet other like-minded young people in my town and I found a program hosted by Marlboro Graduate School called “Get On Board.” It is a unique six-month program designed to teach young professionals about non-profit boards while at the same time helping them grow their personal and professional network while serving the community. At the end of the program I was honored to be invited to join the Youth Services of Windham County board of directors. Youth Services provides programs and assistance to young people and their families through home-based services, mentoring like Big Brothers Big Sisters, young mothers groups, assistance with finding jobs and homes, court diversion programs, and many other services.

As I have become more involved with Youth Services I have noticed a number of ways that working with a non-profit organization can inform economic development efforts.

  • Involve Young People: Many economic development planning processes do not do enough to involve young people in the brainstorming, decision making, or implementation process. By inviting young people to participate in the process there will be an infusion of new ideas, new points of view, and new energy to get work done.

  • Partner with Non-Profits: Many non-profits are doing really incredible work towards many of the goals being pursued through a planning process. For example, Youth Services manages the local Ready to Achieve Mentoring Program (RAMP) which provides career mentoring to young at-risk youth through an after-school program that includes assistance with resume writing, one-on-one mentoring programs, site visits to local employers, presentations from professionals, and general soft skill development. The RAMP program focuses on STEM careers and hopes to help the high school students move towards successful careers. This type of workforce development and youth engagement is just what is called for in many economic development plans.  

  • Sharing Resources: By using the planning process to support partnerships and collaborations it is possible to share what resources do exist and work towards shared successes. Non-profit organizations are facing unprecedented challenges when it comes to finding resources for the work they are doing and by finding common ground with other agencies and organizations there could be new opportunities that develop.  

  • Basic Welfare Needs as Requirement for Economic Development: In many cases there are basic health, safety, and welfare issues that are standing in the way of people achieving their potential. Planning processes should consider welfare issues or else risk missing an entire segment of the population.  

  • Ask For Help: One of the first things you learn when talking about fundraising for non-profits is that the hardest part is taking the first step and asking. People want to be involved in their community and help in any way that they can, they just need to be asked. During planning processes we can often get overwhelmed by the amount of work that needs to be done in order to move towards the goals and vision but asking people to get involved and work within their networks may be just what is needed to have success in economic development.


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Understanding Advanced Manufacturing

by Jim Damicis 19. January 2015 17:46

The following article appears in the December 2014 issue of Expansion Solutions magazine. It was co-authored by Jim Damicis, Christa Franzi, and Ian Flatt. 

 

Despite transformations within the industry, including outsourcing and automation, manufacturing is alive and well in the United States. Over the past several decades, the industry has shed jobs, devastating communities and regions that relied on these employers to provide well paid employment. However, even as the industry was cutting jobs over this period, manufacturing output and productivity were increasing dramatically, representing new investments in technology and skilled workers. Recently, the rate of job loss has begun to decrease and the manufacturing sector is projected to add jobs over the next several years. In regions across the country, gains in the manufacturing sector have been an important part of the economic recovery.

 

Despite its diminished employment footprint, the manufacturing industry continues to be a major driver of economic output in the US. The sector is closely tied to research and development (R&D), innovation, technology, and exports and typically pays higher wages than other sectors, further driving the economy. In recent years, American manufacturing has been undergoing what some have called a renaissance, capitalizing on a range of new opportunities:

  • The declining price of computer power allows small companies to be players in the global market;

  • 3D printing makes small-batch, custom manufacturing possible, allowing smaller companies to compete and grow;

  • Technology is creating new opportunities in niche manufacturing sectors that are at cross sections of manufacturing and other industry sectors such as advanced materials and composites, nanotechnology, and bio-related and biotech manufacturing.

  • On-shoring and near-shoring, driven by:

    • Increasing labor costs in China;

    • Reduced value of the U.S. dollar;

    • Cost of transportation and logistics to get products to end users;

    • Increases in American oil and natural gas production, which has led to:

      • Increasing demand for machinery and chemicals

      • Declining energy costs in the US

    • Lack of quality control and intellectual property protection in other markets.    

While these opportunities and trends apply to the manufacturing industry as a whole, the effects are particularly profound for advanced manufacturing.

 

WHAT IS ADVANCED MANUFACTURING?

Advanced manufacturing brings to mind certain buzz words: cutting edge, innovation, value-added, customization, emerging technology, skilled workforce…and so on. Conceptually, it seems obvious; we can picture what advanced manufacturing is. The challenge comes when attempting to create a definition and delineate between traditional and advanced manufacturing. Whether trying to track the advanced manufacturing industry nationally or at a regional scale, a consistent and clear definition is needed.

The Science and Technology Institute, a federally funded research and development center, assembled a summary of some advanced manufacturing definitions that have been proposed by experts. These definitions are outlined in brief below:1

 

New Manufacturing Industries – Based on what is being produced, this definition focuses on new and emerging industries such as aerospace and bio-manufacturing (the manufacturing arm of the biotechnology industry) as opposed to “traditional” manufacturing such as steel, automotive, or machinery.

 

Use of New Methods for Manufacturing – This definition includes industries that develop newer and better products through the use of advanced production technologies. Paul Fowler of the National Council for Advanced Manufacturing explains that under this definition, advanced manufacturers use computer, high precision, and information technology combined with a skilled workforce.

 

Sustaining the Cutting Edge Another definition offered by some experts is the rapid transfer of science and technology into manufacturing processes and products. Today’s digital economy allows competitors to quickly adopt new products, replacing the current cutting-edge technology. Therefore, to remain a front-runner, the time from research and development to production must be reduced.

 

Manufacturing Frontier – This definition contrasts with those that distinguish between traditional and advanced manufacturing, noting that technological advancements and innovation take place in both well-established and emerging industries and apply to both existing and new products. This viewpoint presents a dynamic non-definition as businesses strive to achieve and maintain a competitive advantage. As the “frontier” continually changes, so does what comprises advanced manufacturing.  

 

Some believe that the range of definitions for advanced manufacturing has contributed to years of underinvestment in US manufacturing by both the public and private sectors, noting that, “without strong agreement about what advanced manufacturing means, we’ve over-valued some segments of the manufacturing sector and under-valued others.” 2

 

Taking into account the definitions above, the 2011 report to the President, Ensuring American Leadership in Advanced Manufacturing, and the 2012 report, Capturing Domestic Competitive Advantage in Advanced Manufacturing, prepared by Presidents’ Council of Advisors on Science and Technology offer a comprehensive definition:

 

“Advanced Manufacturing is a family of activities that (a) depend on the use and coordination of information, automation, computation, software, sensing, and networking, and/or (b) make use of cutting edge materials and emerging capabilities enabled by the physical and biological sciences, for example nanotechnology, chemistry, and biology. This involves both new ways to manufacture existing products, and especially the manufacture of new products emerging from new advanced technologies.” 3

 

“Advanced Manufacturing is not limited to emerging technologies; rather, it is composed of efficient, productive, highly integrated, tightly controlled processes across a spectrum of globally competitive U.S. manufacturers and suppliers. For advanced manufacturing to accelerate and thrive in the United States, it will require the active participation of communities, educators, workers, and businesses, as well as Federal, State, and local governments.” 4

 

What is the difference between typical and advanced manufacturing? In today’s rapidly shifting global economy, is there a difference anymore? Any given manufacturer is not likely to align perfectly with a single definition. The chart below summarizes how the manufacturing environment is changing in key areas.

 

 

 

MARKET TRENDS

Throughout the country, localities, regions, and states have defined advanced manufacturing for their community using the North American Industry Classification System (NAICS) codes. Defining the cluster in this way enables economic developers and policymakers to track changes in the industry and analyze trends. Because this report is looking at the advanced manufacturing cluster at the national level, a broad definition that includes 124 of the 364 manufacturing NAICS codes at the 6-digit level was used. The list of NAICS codes used by the New Jersey Department of Labor and Workforce Development in several recent reports was relied upon heavily for this report, however, chemical manufacturing codes were removed to make the definition more applicable to the nation as a whole. Several caveats should be mentioned when defining advanced manufacturing using NAICS codes. First, every region and state will have a different definition of advanced manufacturing, depending on the types of manufacturing businesses in the area. For example, paper manufacturers in a certain region may be using advanced techniques while companies manufacturing the same goods in a different area may not.

 

 

 

Second, two businesses in the same NAICS code could be using different methods of production, making one considered “advanced” and the other “conventional.” Third, definitions can change. A technological revolution in an industry sector could transform it from being considered “conventional” to “advanced.” Conversely, an industry sector may lose its edge and no longer be considered an advanced manufacturer.

 

This definition based on NAICS codes was created for the purpose of analyzing data and observing trends. States and regions should consider the characteristics of manufacturers in their area to determine how advanced manufacturing should be defined and tracked. Communities will need to tailor this definition to their economy, eliminating some NAICS codes and adding others.

 

Employment, Occupations, and Earnings based on 2014 data:

All data in this section sourced from Economic Modeling Specialists, Inc. (EMSI), Complete Employment, 2014.3


Based on the data in the tables below, it is clear why advanced manufacturing has been top of mind for economic developers and policy makers across the country. The wages are high, the sector proved to be more resilient than manufacturing as whole through the recession, and the growth prospects are strong. The advanced manufacturing sector is expected to grow five times faster than the manufacturing industry as a whole over the next ten years.


The manufacturing industry generally provides higher than average wages to its employees. The wages of advanced manufacturing employees, however, are even higher, with average wages in advanced manufacturing 13% higher than wages in the manufacturing industry as a whole and 48% higher than the average wage for all industries in the US.

 

 

 

According to the data used in this report, advanced manufacturers also have a higher average number of employees per establishment than other manufacturers and all industries. However, this average masks the broad range of sizes of advanced manufacturing establishments. While there are some advanced manufacturing industries, such as aircraft manufacturing with an average of 324 employees, that require economies of scale to operate successfully, many other sectors have much lower averages. Advanced manufacturers can range from large operations with hundreds of employees to much smaller operations that employ a handful of highly skilled people.

 

In 2014, the top 5 largest manufacturing sectors were:

  • Machine Shops

  • Aircraft Manufacturing

  • Semiconductor and Related Device Manufacturing

  • Other Vehicle Parts Manufacturing

  • Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

 

In terms of absolute growth (number of jobs), over the next 10 years, leading sectors are expected to be:

  • Machine Shops

  • Sheet Metal Work Manufacturing

  • Motor Vehicle Seating and Interior Trim Manufacturing

  • Other Motor Vehicle Parts Manufacturing

  • Fabricated Structural Metal Manufacturing


In terms of fastest growing sectors (percentage growth) over the next 10 years leading industries are expected to be:

  • Blank Magnetic and Optical Recording Media Manufacturing

  • Motor Vehicle Seating and Interior Trim Manufacturing

  • Printed Circuit Assembly (Electronic Assembly) Manufacturing

  • Plate Work Manufacturing

  • Industrial and Commercial Fan and Blower and Air Purification Equipment Manufacturing  

 

 

WHAT THIS MEANS FOR ECONOMIC DEVELOPERS?

The manufacturing environment is changing rapidly, therefore economic development approaches must be adapted to enable manufacturing to thrive and grow in local and regional economies. New strategies will have to be implemented and updated as the needs of this industry sector change. As advanced manufacturers constantly evolve to remain on the cutting edge, so too must the strategies of communities and economic developers working with them.

 

One of the most important drivers for advanced manufacturing businesses is the availability of a skilled workforce. In some industries, workers can be trained to perform duties on the job. Generally, advanced manufacturing is not one of those industries. The integration of technology and advanced machinery diminishes the need for “unskilled” workers and increases the reliance on workers with the sophisticated skills required to operate the equipment. Advanced manufacturing training courses and programs in community colleges, technical schools, and even K-12 education systems are essential to supporting growth in the advanced manufacturing sector.

 

Advanced manufacturers rely on a strong regional economic and education institutions. Crucial components of an advanced manufacturing establishment are sophisticated supply chains and distribution systems, reliable technological and industrial infrastructure, and research and development. Few individual communities can supply all of these needs, requiring broad cross border and cross regional collaboration. Engaged higher education institutions, particularly those with strong engineering programs, are another pillar of a successful advanced manufacturing ecosystem. By providing access to a steady pipeline of skilled graduates and new research and development, colleges and universities have been integral to growing the advanced manufacturing industry in regions and states across the country.

 

The specific skills required of advanced manufacturing employees also make employee recruitment important to some sectors. A community’s attractiveness to outsiders, with desired amenities and a high quality of life, are important as advanced manufacturers recruit talent that cannot be hired locally.

 

Most regions and communities will not be a fit for all advanced manufacturing sectors, however, by knowing and understanding your strengths and the requirements of businesses in these sectors, new opportunities in the wide-range of advanced manufacturing sectors can be capitalized on. To do so it is important to recognize that success is not just about one business or a group of business. You must consider the regional ecosystem—develop partnerships and initiatives.

  • Workforce - Education/training organizations – aligning with existing and future needs

  • R&D/Innovation Institutions

  • Industry/Trade Associations

  • Supply Chain

  • Infrastructure/Logistics

 

And finally, don’t discount small business—not all advanced manufacturing is large.

 

Thank you to:

We’d like to thank Janet Ady for kindly providing us with slides prepared and presented by the late Robert Ady of ADY International Company.

 

Authors:

Jim Damicis, Senior Vice President, Camoin Associates

Christa Franzi, Senior Economic Development Specialist, Camoin Associates

Ian Flatt, Economic Development Analyst, Camoin Associates

 

Advanced Manufacturing NAICS Codes

332 Fabricated Metal Product Manufacturing 

333 Machinery Manufacturing 

334 Computer and Electronic Product Manufacturing

335 Electrical Equipment, Appliance, and Component Manufacturing

336 Transportation Equipment Manufacturing

339 Miscellaneous Manufacturing

 

References

1. White Papers on Advanced Manufacturing Questions, Science and Technology Institute, 2010, http://www.whitehouse.gov/sites/default/files/microsites/ostp/advanced-manuf-papers.pdf.

2. Patricia Panchak, “The Manufacturer's Agenda: Why We Need a Better Definition of 'Advanced Manufacturing'”, Industry Week, 2012, http://www.industryweek.com/leadership/manufacturers-agenda-why-we-need-better-definition-advanced-manufacturing.

3. Report to the President on Ensuring American Leadership in Advanced Manufacturing, President’s Council of Advisors on Science and Technology, 2011, http://www.whitehouse.gov/sites/default/files/microsites/ostp/pcast-advanced-manufacturing-june2011.pdf.

4. Report to the President on Capturing Domestic Competitive Advantage in Advanced Manufacturing, President’s Council of Advisors on Science and Technology, 2012, http://www.whitehouse.gov/sites/default/files/microsites/ostp/pcast_amp_steering_committee_report_final_july_17_2012.pdf.

5. Additive Manufacturing Categories Processes and Materials, Advanced Manufacturing CRC, 2012, http://amcrc.com.au/wp-content/uploads/2013/03/ADDITIVE-MANUFACTURING-CATEGORIES-PROCESSES.pdf.

 

 

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Free Webinar Series: Economic Development & Workforce Development - Bridging the Gap

by Colleen LaRose 17. November 2014 16:38

Free Webinar Series: Economic Development & Workforce Development - Bridging the Gap

 

Camoin Associates is announcing a 4-part webinar series on trends in workforce development and what it means for the economic development community. Each webinar will provide valuable information and tools that economic developers can apply in your communities. Links to the presentation slides from the first two webinars are provided below. You can re-watch the full presentations on our Navigator YouTube Channel.

 

Part I: The Disconnect Between Education & Workforce Development: And what this means for the future workforce

 

Download the Part I slides (PDF).

 

Part II: The Role & History of Workforce Development through 1998 Workforce Investment Act (endedin 2014)

  

Download the Part II slides (PDF).

 

  

Join us for Upcoming Webinars in the Bridging the Gap Series: 

 

Part III: Workforce Innovation and Opportunity Act  of 2014 (WIOA): What it Means to Economic Development

Date: February 5, 2015

Time: 1:00 - 2:30 PM

Register Here

   

 

Part IV: Economic Development and Workforce Development Collaboration: Best Practice Case Studies

Date: March 5, 2015

Time: 1:00 - 2:30 PM

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Why Your Economic Development Strategy Should Include the Health Care Sector

by Jim Damicis 17. November 2014 11:27

The health care sector is often not a focus of local and regional economic developers or included as a targeted growth industry in economic development plans and strategies. There are several reasons for this. First, it is often seen as “out of one’s control” because of health care bureaucracy (laws, regulations, insurance, etc.). Economic developers feel there is little they can do to influence decision-making within the context of economic development, namely supporting investment and jobs. Second, health care is not viewed as an export-intensive industry bringing in wealth from outside the local and regional boundaries. Rather, it is seen as distributing money within the local/regional economy because of its focus on serving local residents and workers. Third, except for select science and tech-intensive specialty occupations such as doctors, many of the jobs such as medical technicians and facilities support typically pay low to moderate wages. Fourth, the industry outlook for investment and job creation is often distorted by the financial and bureaucratic challenges of the larger institutions within the industry, primarily hospitals, causing emerging opportunities in new, innovative, small, and niche markets and businesses to be overlooked.

 

In spite of these perceptions economic developers should take a closer look at the health care sector as an important part of local and regional economies. Health care contributes significantly to the number of businesses and levels of employment and wages. Here’s what the data shows with respect to health care in the U.S.:

 

·        In 2013, employment in the health care and social assistance sector totaled nearly 14.5 million jobs representing 12% of all jobs. These jobs were present at 1.2 million establishments. This was the highest level of all the major employment sectors.

 

·        Between 2004 and 2013, the health care and social assistance sector added 3.3 million jobs, the most among all sectors in terms of job growth. This represented a growth rate of 22% over the ten-year period. And growth is projected to continue. Between 2013 and 2022 the health care and social assistance sector is projected to add another 3.8 million jobs (the most among all major sectors), an increase of 21%.

 

·        Also in 2013 there were another 3.9 million jobs in industry sectors closely related to health care including Pharmaceutical and Medicine Manufacturing, Medical Equipment and Supplies Manufacturers and wholesalers, pharmacies and health care stores, testing laboratories, Research and Development entities, and state and local government hospitals.

Source: Calculated by Camoin Associates, based on data from EMSI; QCEW Employees, Non-QCEW Employees & Self-Employed - EMSI 2014.2 Class of Worker; www.www.economicmodeling.com/ 

Additionally, the impact of health care on local and regional economies goes well beyond businesses, jobs, wages, and direct economic inputs and outputs. The level of access to and quality of health care determines individual wellness and, in turn, the well-being of communities and regions. They impact not only productivity, but quality of life and place to support workers and residents, attract and grow companies and entrepreneurs, and offer opportunities for community engagement and volunteerism.

Because of its significant impacts on economic, community, and individual health, the health care sector should become a focus of economic development efforts at the local and regional level. While the hospital and institutional component of the industry continues to experience consolidation, health care also offers future growth opportunities for medium and small businesses focusing on emerging services and technologies including personal and home-based care and tele-health. Also, by focusing on community health systems and preventive care through an approach that integrates providers and stakeholders in mental, physical, and social health, additional business and employment opportunities can be created. Over the course of the next year, along with colleagues through the Communities of the Future and World Future Society I will be exploring how a focus on community health systems can play an integral role in local and regional economic and community development.  I look forward to sharing our progress. In the meantime please feel free to contact me with examples in your communities or an interest in further pursuing this topic.

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Crowd Funding Economic Development

by Dan Stevens 17. November 2014 10:39

Most of us have heard of crowd funding by now, the trendy new way of raising funds by getting a large number of people to chip in whatever they are willing to invest. It has proven very successful in allowing entrepreneurs to raise start-up capital when a trip to the local bank goes south or is out of the question to begin with.

 

It has also helped generate significant money for social causes as demonstrated by (one of my favorites) the recent revival of Reading Rainbow that generated donations of $5.4 million on crowd funding site Kickstarter. It’s not just entrepreneurs and feel-good social causes benefitting from the movement, however. Communities and economic development organizations are discovering that crowd funding can help reach economic development goals.

 

Let’s take a look at the Michigan Economic Development Corporation (MEDC), which recently started a crowd funding effort (the first of its kind) for its Public Spaces Community Places Initiative. The initiative is designed to implement projects that help create vibrant communities and catalyze private investment like alley rehabilitation and public plazas.

 

One of the key components of the initiative is that it lets MEDC leverage its own resources by matching crowd-sourced funds with grants up to $100,000. The first project, a green alley in midtown Detroit exceeded its target of $50,000 and earned a 1-to-1 matching grant. 

 

Pure Michigan crowd funded project to repurpose five vacant storefronts into a community art center

 

Crowd funding is also being used for more grass roots economic development efforts. The Mile High Business Alliance, a Denver nonprofit, started a crowd funding platform called Neighborhood Catalyst. Community members are able to contribute funding to specific projects in their neighborhoods. The platform also makes it easy for residents to donate time and materials to projects.


Crowd funding for economic development is still in its infancy but the growth potential is enormous. Crowd funding has increased 1,000% in the last 5 years according to Fundable, a crowd funding platform for businesses. Communities and organizations involved in economic development should be aware of this potential funding source when looking to implement future projects.


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New Markets for Local Food

by Ian Flatt 17. November 2014 10:31

Anyone who has visited a local grocery store or restaurant recently has noticed that local foods have an increasingly prominent role in the local economy. By supporting these local farmers and producers, a greater share of the dollars spent on food can be retained in the local economy. A strong local food industry can also add to a community’s sense of place, supporting both population retention and the tourism industry. As the benefits of these local products have become more important to local economies, economic developers and community organizations are focusing on supporting both local food producers and consumers, restaurants, and major institutions that are interested in “buying local.”

 

At this time, farmers market are fairly common across the country and rate of growth of direct to consumer sales of farm products has begun to slow. To continue to capitalize on consumer demand for local foods, producers have turned to the wholesale markets to find a home for their goods, trading a lower price for greater sales. Farmers can derive many benefits from making large sales to wholesale markets, however this market also presents many barriers and challenges that small producers did not face in the direct to consumer market. Producers and organizations across the country have developed new ways to support this transition and help continue to grow the local foods market.

 

Food Cooperatives: To supply large wholesale buyers with the quantity and variety of agricultural products they require, local producers may need to combine their products with other producers in the area. Forming food cooperatives is one way to accomplish this. By aggregating the products of several small producers, local farms can meet the needs of large wholesale purchases, such as K-12 schools, universities, and hospitals. Cooperatives can also share some costs, such as marketing, distribution, and storage, to assist smaller producers that may not have that capacity. Formed in 1995, the New North Florida Cooperative Association has been working with local suppliers to provide a regular supply of agricultural products to area K-12 schools, serving over 200,000 students

 

Community Commercial Kitchens: Commercial kitchens can offer small farms and food producers the ability to process and store their products or transform them into value-added agricultural goods. These kitchens can also be utilized as a location to provide training and networking opportunities to local producers. With access to space in a commercial kitchen, local food producers can better position their products to sell to wholesale buyers and take advantage of opportunities to refine their business through classes and workshops. The Western Massachusetts Food Processing Kitchen was created to strengthen the local foods economy, providing processing and storage space, workshops, and assistance with marketing and sales to institutions.

 

Food Exchanges: For some food purchasers and sellers, the biggest challenge is finding each other. Large wholesale purchasers who are accustomed to purchasing all of their products from one supplier may not have the time or manpower to find and vet many smaller suppliers. Some communities and organizations have stepped in to provide networking and outreach services to help create these connections. Online food exchanges have also become more common. These exchanges offer the opportunity for buyers and sellers to connect online by posting announcements of the products they need or have available. Recently launched by the Piedmont Environmental Council to serve the greater Charlottesville, VA area, the Farm-Chef Express offers this capacity to buyers and sellers, using an online forum and Twitter to post available products and needed goods in real time.

 

Food entrepreneurs and organizations in communities across the country have worked to creatively overcome barriers that could impede continued growth in the local food industry. How has your community overcome similar challenges in this market?

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Top 10 Facts Economic Developers Should Know About Their Region

by Rachel Selsky 16. November 2014 20:13
 

Click on the image below to watch a cartoon about the 10 things economic developers need to know about their region! What would you add to the list? Tweet us your answer @camoinassociate!

  

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About Camoin Associates

Camoin Associates is a professional service firm that utilizes its understanding of the public and private sector investment process to assist businesses and developers in capitalizing on funding, financing and tax programs established to encourage private investment. We also specialize in advising economic development organizations and municipalities in creating strategies, policies and programs that support investment and job creation.   [Click Here for More]

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