Business Retention and Expansion - Existing Firms Create Up to 80% of New Jobs

The Best Kept Secret in Economic Development! Business Retention and Expansion (BR+E)
Why does a "successful" business need community support?
In short, because stable businesses play vital roles in their communities. Locally owned businesses usually have a long-term commitment to their community. They relate to their community’s lifestyle, and they have a vested interest in their community’s quality of life. They are there because they want to be.

Equally important, existing businesses are major contributors to the community’s economy and tax base. Cumulatively, they employ the greatest numbers and, as they grow and expand, they can generate up to 80 percent of their community’s new jobs. In economic development efforts, existing, successful business owners are precious resources. Their presence as community ambassadors also makes a very positive statement in new business recruitment.

Why should a community have a BR+E program?
Simply put, because everyone benefits -- when existing businesses thrive, so do their communities. And viable, healthy businesses are apt to remain in communities that demonstrate constant and visible commitment. Support of existing businesses also demonstrates support of job creation and additional community cash flow.

Why should your organization promote business retention and expansion?
Because existing businesses can relocate thus leaving a void in your community. They must not be taken for granted! The reasons a business may leave a community include lack of public services, political unrest, site limitations and lack of trained labor, just to name a few. Some reports indicate that another reason companies relocate is because the owner decides he/she would rather live somewhere else. In order to prevent some of the potential closures and/or relocations in a community, outreach to businesses may be necessary. However, when hard times hit a business community, and closures or failures occur, it is already too late to save some businesses. Take action early! For example, an organization representative should visit all new businesses, welcome them and develop a relationship. Let them know who to call for information on business assistance. This will send the positive message that the community cares about their future and well-being. -- Excerpted from the Arizona Commerce Authority

A community consensus approach to encourage the growth of local businesses
Why Business Retention and Expansion?
A healthy and vibrant local economy depends on the well-being of a community’s existing firms.
Thus, efforts aimed at helping local businesses survive and grow in the local community are key to successful economic development. The community benefits because:
• Forty to eighty percent of all new jobs are created by existing firms
• Businesses that stay competitive are more likely to remain in the community and possibly expand
• Keeping an existing business is often easier than recruiting a new firm
• Firms considering moving will talk to existing firms. Odds are better of attracting new firms if existing ones are happy with the community.

Benefits of the Community Leader’s approach to BR+E
Economic development efforts often require action from many community players. Without community consensus, economic development stalls.The University of Minnesota Extension Service provides technical assistance, training and research to help communities assess business concerns, understand the structure of the local economy, set priorities, and implement projects that will help make communities more vibrant.

BRE Objectives
Short Term
• Demonstrate community support for local firms
• Help solve immediate business concerns

Long Term
• Build community capacity to sustain business growth and development through creation of a broad-based coalition
• Increase the competitiveness of local firms
• Establish and implement a strategic plan for economic development
-- Excerpted from the University of Minnesota Extension Service

Ten Signs of a Business-Friendly Community

1) The community has a pro-business attitude — starting at the top. If top officials in local government like councilors and selectors support new businesses, chances are good that others within the community will be supportive as well.

2) The community lets it be known that it is “open for businesses” by having someone — usually an economic development director — in place to act as a liaison between businesses and community officials to streamline the development process.

3) The community is proactive about offering tax increment financing packages (TIFs) or other tax breaks to attract businesses. As tax breaks are becoming a common tactic to lure companies, cities and states that do not make an effort to offer them up front run the risk of seeming standoffish to new business.

4) The community has a skilled work force — or if not, the community will willingly form partnerships with businesses and local community colleges in training programs to meet a company’s specific needs.

5) The community has sound infrastructure in place. If it is not completely up to par, companies should not hesitate to ask city officials how willing they are to make upgrades happen sooner rather than later. Often the promise of new jobs may be just the thing to make it a top priority.

6) The community has municipal services — such as water, sewer, electrical ,and high-speed Internet — that are up to par and affordable, as well as fire and police departments that are reliable and possess state-of-the-art equipment. Business-friendly municipalities will be quick to impress upon prospects that they have the capability to handle such things as fires, road maintenance, etc., and are willing to make the necessary investments to keep it that way.

7) The community has a good school system and recreational opportunities, and makes an effort to invest in their local arts organizations. Business-friendly communities realize that in order for a company to be successful, it needs to find a location where current and future workers will want to work, live, and raise their families.

8) The community has officials who are aware of the importance of good public relations and are willing to go out of their way to spread the good word on behalf of new businesses coming to town.

9) The community operates with a realization that time is money for business owners, and its officials are willing to cut through red tape by assisting on things like the pre-permitting of development sites.

10) The community has resources and people to do the legwork and help companies find the best land or building available, or to work with them to ensure a new facility can be built to meet their needs.

Read the entire article at Area Development Online http://www.areadevelopment.com/viewpoint/apr07/tenSigns.shtml

Political will, federal dollars, and port expansion in the Southeast

The pledge to abstain from earmarks made on the campaign trail is proving more complicated in practice.

Some senators' resolve is being tested as two of the nation's major ports, Savannah, GA and Charleston, S.C., urgently seek funding to expand. Port officials say federal dollars will be crucial next year so they can deepen their harbors to accommodate bigger ships after the Panama Canal is widened and reopens in 2014.

It isn't clear that can be done without earmarking—special funding that lawmakers request for projects in their home states.

The Savannah port is seeking $105 million for the upcoming fiscal year to begin dredging the port, while Charleston wants $400,000 for a feasibility study for its own deepening project. If the ports cannot receive the mega-ships, Savannah and Charleston officials say, the cargo will go to New York or Norfolk, Va., which they argue would be inefficient and deliver an economic blow to the Southeast, costing jobs.

Spending on items such as ports, bridges and roads are included in the president's annual budget, which is then reviewed by congressional committees. It's at that point that lawmakers often go to a committee chairman to get their earmarked projects inserted. Individual projects could also be funded in free-standing bills, but that would be impractical, given how numerous such projects are.

Sen. Lindsey Graham (R., S.C.) supports the earmark ban but has vowed to earmark funds for the Charleston port if necessary. "I'm in a spot where I have to get the port deepened for economic reasons," he said.

Democrats from the region say the ban never made any sense. "Charleston is going to be dead in the water because of this short-sighted myopic view that seems to be controlling," said Rep. James Clyburn (D., S.C.).

Savannah, the second-busiest port on the East Coast after the Port of New York/New Jersey, has been pressing an application with the U.S. Army Corps of Engineers since 1999 to dredge the Savannah River from its current 42-feet depth at low tide to 48 feet. This month, the Corps recommended dredging to 47 feet. The cost has been estimated at about $600 million—$400 million of which would be sought in federal funds.

Curtis Foltz, executive director of the Georgia Ports Authority, said in an interview that he and other officials had visited Washington repeatedly to lobby the White House and the state's congressional delegation. Having no port for large ships in the Southeast would increase the cost of transporting imported and exported goods from one of the fastest-growing parts of the nation, he said.

Georgia's Republican senators are touting their opposition to earmarks but also suggesting they'll do whatever it takes for the port. "My position has consistently been, I'm going to support reform or total elimination of earmarks," said Sen. Saxby Chambliss (R., Ga.). "But if a project is vital to the economy and jobs of my state, I'm sent here by the people of my state to make sure their interests are looked after."

Sen. Johnny Isakson (R., Ga.), who also supported the ban, said he would "continue to fight for funding for projects such as the expansion of the Savannah port that is critical to my state and to U.S. trade."

The Charleston port, like its counterpart in Savannah, is a major driver of its state's economy. Charleston officials are planning a new terminal by 2016 that will boost the port's container capacity by 50%. They also want to deepen the port—the East Coast's fourth-largest—by five feet to 50 feet.

Sen. Jim DeMint (R., S.C.), one of the Senate's foremost earmark opponents and the force behind the ban, does not intend to make an exception for Charleston, a stance that has attracted praise from fiscal conservatives but some heat at home. Mr. DeMint said he strongly supported the port, but that the earmark system had not helped it.

Port projects are handled by the Army Corps, whose budget is largely driven by earmarks. Mr. DeMint has proposed a merit-based system under which a commission would determine which Corps projects receive priority.

QUESTION: Expanding the ports in Charleston and Savannah may require expending considerable political capital. With limited dollars and many politicians pledging to forgo earmarks, what does this mean for JaxPort expansion? Will JaxPort be able to compete effectively with other ports in the Southeast in the future?

Read the full Wall Street Journal article, "Projects Test Resolve on Earmarks" by Cameron McWhirter and Naftali Bendavid

Jacksonville economic indicators lag behind rest of the nation

National economic indicators are pointing to a pickup in growth after the holidays, but local indicators show that Jacksonville may continue to lag behind the rest of the country.

The Conference Board, a New York research firm, said Thursday that its Leading Economic Index for the U.S. rose by 0.5 percent for the second straight month in October. That’s the fourth straight rise in the index that is designed to predict economic conditions several months ahead.

But the University of North Florida’s Local Economic Indicators Project (LEIP) reported that its leading index for the Jacksonville area fell by 0.31 points last month to 103.66, reversing a 0.80-point rise in September. That continues an up-and-down trend for the Jacksonville index that has risen five times and dropped five times in the first 10 months of the year.

The report on economic indicators follows another LEIP report Wednesday that its Consumer Price Index for the Jacksonville area fell in October for the seventh time this year, showing that businesses are keeping prices down because of weak consumer demand.

“The combination of our negative LEI and CPI values in October locally is not good news. The local area continues to lag the national recovery,” UNF economist Paul Mason said.

One negative trend in the Jacksonville area was a 400 person increase in new applications for unemployment insurance in October, after three straight monthly declines in new unemployment claims.

Nationally, the Conference Board said its index of coincident indicators, which measures current economic activity, rose 0.1 percent in October after being unchanged in August and September. However, the research group said the October leading indicators suggest that the slow growth may start to speed up.
The research group said the October leading indicators suggest that the slow growth may start to speed up.

“Expect modest holiday sales, driven by steep discounting. But following a post-holiday lull, the indicators are suggesting a mild pickup this spring,” Conference Board economist Ken Goldstein said in a news release.

Florida Times Union - November 18, 2010
http://jacksonville.com/business/2010-11-18/story/jacksonville-economic-indicators-lag-behind-rest-nation

Scott's "7-step plan" creates 700,000 jobs in 7 years

Governor Elect Rick Scott's plan for getting Floridian's back to work

1. Implement Accountability Budgeting

• Transparent, outcome-based budgets
• Biennial budgets that will allow an adequate review of the budget’s goals and give the public time to participate in the budget process
• Spending limits that ensure affordable government expenditures levels AND focus on economic growth not government spending
• Return Florida’s state and local government expenditure burden to at least the 2004 level
• Refuse temporary funding from the federal government that creates permanent spending

2. Reduce Government Spending
Balance the budget – without one-time revenues, borrowed funds, temporary funds, or tax increases.
Implement outcome-based budgeting to create budgeting efficiency throughout government, including:

• Align pension reform with state employee pension contributions in other states to save almost $1.4 billion. Currently Florida workers do not contribute towards their retirement.
• Pay competitive market-based salaries for corrections’ staff, use inmate labor to grow prison food, and competitively bid health care contracts to reduce prisoner costs by $1 billion.
• Impose more stringent standards on non-compliance with work requirements and require drug screening for welfare recipients. This could save Florida $77 million.
• Use common sense business solutions to reduce the cost of government through operational efficiency saving upwards of $500 million (per Florida Taxwatch). Reduce state workforce by 5 percent to save almost $300 million.
• Reform health care for Medicaid recipients (through a waiver) and state employees (consumer directed care) to save taxpayers’ $1.8 billion.
• Veto Pork Barrel Spending and unnecessary pork barrel projects.

3. Enact Regulatory Reform

• More affordable unemployment benefits
• Implement tort reform to limit frivolous lawsuits
• Impose a regulatory freeze and implement a comprehensive review of existing and proposed regulations
• Review state development regulations and expedite permits for job-creating businesses, such as Enterprise Florida’s targeted industries
• Reform Pubic Service Commission (PSC) processes to allow reasonable energy production and expansion
• Lower workers’ compensation costs - a 35% reduction in costs would save businesses about $2.46 billion
• Bring health insurance costs and mandates in line with the U.S. average
• Address Florida’s relatively expensive electricity costs to save businesses approximately $3.25 billion

4. Focus on Job Growth and Retention

• Ensure local economic development offices have the right resources and trained specialists to assist their local businesses with obtaining state and federal grants and complying with state and local regulatory processes
• Eliminate overlapping economic development agencies, and have one group serve as the statewide recruitment agency to assist local economic development agencies.
• As governor serve as the state’s chief economic development officer, working with existing as well as potential businesses every day to create jobs
• Make economic development programs more flexible to allow existing businesses to expand in their own unique ways and invest in the state Innovation Fund that brought Scripps and Burnham research labs to Florida.
• Nurture cutting-edge technology clusters – such as the biotechnology cluster in Orlando that creates over $7 in economic returns from every $1 invested.

5. Invest in World Class State Universities

• Invest in university research, laboratories, business incubators, and technology transfer
• Connecting the research conducted by each of Florida’s university to the state’s economic development process
• Leverage the research strengths of the state’s universities to invest in new and emerging technologies
• State economic development grants will always include partnerships with universities to develop research strengths into unique clusters, such as biotechnology

6. Reduce Property Taxes

• Reduce the statewide property tax (RLE) by $1.4 billion (from 5.29 mills to 4.29 mills, a 19% reduction in RLE).

7. Phase out the Business Income Tax

• Total state tax revenues will benefit from the dynamic economic growth created from the corporate income tax phase-out

More details about the 7-7-7 plan can be found at http://www.rickscottforflorida.com/home/turn-florida-around/

St. Pete Time PolitiFact.com says Scott's job plan promises are mostly true.
The Ledger.com says Scott's Plan may not pan out.

Regional resilience: Bouncing back from disaster - economic, natural, and social

Regions able to bounce back from, adapt positively to, or withstand negative, external shocks that throw a metro area off course are regionally resillient and have the following characteristics.

Strong and diverse regional economy: A diversity of major “export” industries, low reliance on durable goods manufacturing, and a relatively small gap between the incomes of high- and low-income residents help a region withstand or avoid negative economic shocks.

Large shares of skilled and educated workers: Workers with skills and higher levels of formal education have greater capacity to learn new skills and adapt to the changing needs of an economy. Regions with high percentages of highly-educated people are better able to withstand or avoid negative economic shocks.

Wealth: A community with funds, whether government, private, philanthropic, or individual, can help provide adaptive cushion and resources to invest in rebuilding, reconstruction, reforms, and needed capacities.

Strong social capital: A community with strong attachment to place, strong citizen participation and community engagement, and social cohesion between groups and individuals is more resilient.

Community competence: The ability of a community to solve problems, identify creative solutions, have nimble policies and institutions, and build strong political partnerships can all be critical tools to help a metro area adapt to and rebound well from a shock.

Thriving after the (economic, social, and natural) disaster after the storm in the seven-county, Post Katrina, Post Oil Spill, Post Recession New Orleans region means building a more prosperous community as defined by the following goals.

• Quality economic growth that boosts productivity, spurs innovation and entrepreneurship, and generates quality jobs and rising incomes;
• Inclusive growth that expands educational and employment opportunities, reduces poverty, and fosters a strong and diverse middle class;
• Sustainable growth that conserves natural resources, maintains environmental quality, and increases the safety of the area; and
• High quality of life for residents and businesses that often includes a package of strong amenities and quality public services, like good schools and safe streets.

Do these or similar goals seem make sense for the Jacksonville Region?

 Selected key actions for a more resilient New Orleans that may apply to the Jacksonville Region.

Responding to the BP Oil Spill and the Great Recession

• Diversify and strengthen the key regional “export” sectors of the economy. Tap into the area’s expertise in energy and higher education research capacity on renewable energy; challenge and encourage the growing network of entrepreneurs to identify bold, sustainable business ideas that strengthen core industries; and accelerate the transition to innovation-fueled, knowledge-based industries.
• Expand international export capacity to help grow existing industries and the number of good-paying jobs. Invest in innovation in key industry clusters to increase the quality of the goods and services produced in the region for sale to other regions and abroad; modernize the port and multimodal freight strategy to help move a greater volume of goods; or help small and mid-sized businesses reach global customers.
• Empower the area’s many institutions of higher education to help retrain and improve the quality of the workforce for growing sectors of the economy. The relatively high share of workers with low education levels and skills may be holding back the transition to more robust and knowledge-based industries and hindering workers’ pathways to wealth-creating opportunities.

Strengthening assets and capacities for greater regional resilience via community engagement

• Continue to nurture an “open society” where engagement, networks, partnerships, and collaboration continue organically
• Maintain citizen participation as the community transitions from “crisis” to the mundane task of implementation
• Expand local “wealth” (e.g., tax base, private investment, philanthropy, individual) to match outside resources and sustain a level of self-reliance
• Diversify and strengthen the economy’s export sectors and increase the share of its skilled and educated workers

Ultimately success depends on political, civic, business, and community leaders who identify a set of common goals, priorities, and strategies to set the region on a future course that leads to meaningful outcomes.

What can the Jacksonville Region learn from New Orleans’ seven-county region?

Read more at https://gnocdc.s3.amazonaws.com/NOIat5/Overview.pdf  An overview of Greater New Orleans: FROM Recovery to Transformation by Amy Liu and Allison Plyer of the Brookings Institute

Recession to recovery more likely in a previously expanding local economy

As of August 2010, according to Moody’s Analytics Adversity Index, the Jacksonville Metropolitan Statistical Area (MSA) was “At risk” for continued recession. The Index measures employment, single family housing starts, housing prices, and industrial production. Take a look at these Jacksonville MSA numbers.

8.2010 (“At Risk): Employment (-0.31%) | Single family housing starts (-0.67%) | Housing prices (N/A) | Industrial production (+5.22%)

So what did the Jacksonville MSA look like a year ago?

8.2009 (“Recession”): Employment (-6.17%) | Single family housing starts (+35.82%) | Housing prices (-7.95%) | Industrial production (-9.97%)

What about 2 years ago in the Jacksonville MSA?

8.2008 (“Recession”): Employment (-2.16%) | Single family housing starts (-31.79%) | Housing prices (-10.78%) | Industrial production (-2.08%)

Jacksonville MSA Strengths
-Military base underpinning strong demographic trends.
-Growth drivers in tourism and port.
-Low-cost center for financial services.
-Competitive living costs.

Jacksonville MSA Weaknesses
-Below-average incomes.
-Reliance on federal defense spending.
-Very susceptible to downturns in the business cycle.

In August 2008 there were seven states considered “In Recovery” – Montana, Colorado, New Mexico, Texas, Alaska, Massachusetts, and New Hampshire. These states were still considered “In Recovery” as of August 2010.

How have some of the large metro areas in these states fared since 2008?

Austin, Texas MSA
8.2010 (“Recovery”): Employment (+2.06%) | Single family housing starts (-24.36%) | Housing prices (N/A) | Industrial production (+9.17%)
8.2009 (“Recovery”): Employment (-2.75%) | Single family housing starts (-0.39%) | Housing prices (-0.39%) | Industrial production (-10.49%)
8.2008 (“Expansion”): Employment (+2.22%) | Single family housing starts (-38.32%) | Housing prices +3.73%) | Industrial production (+5.32%)

Austin MSA Strengths
-Strong population growth supports demographically driven consumer demand.
-Well-educated labor force attracts high value-added tech businesses.

Austin MSA Weaknesses
-Competitive pressure of foreign high-tech manufacturing challenges local industry.
-Tech cycle adds to cyclical volatility of overall local economy.

Denver, Colorado MSA
8.2010 (“Recovery”): Employment (-1.00%) | Single family housing starts (+10.9%) | Housing prices (N/A) | Industrial production (+5.74%)
8.2009 (“Recession”): Employment (-5.06%) | Single family housing starts (-34.08%) | Housing prices (-0.66%) | Industrial production (-8.98%)
8.2008 (“Expansion”): Employment (+1.05%) | Single family housing starts (-48.01%) | Housing prices (-0.52%) | Industrial production (-2.21%)

Denver MSA Strengths
-High concentration of high-tech industries and skilled workers.
-Per capita income is well above the national average.
-Strong demographic trends.
-Credit quality has held up well during the recession.

Denver MSA Weaknesses
-High dependence on volatile industries.
-Fiscal conditions are deteriorating

Boston, Massachusetts MSA
8.2010 (“Recovery”): Employment (+1.3%) | Single family housing starts (-3.12%) | Housing prices (N/A) | Industrial production (+7.1%)
8.2009 (“Recession”): Employment (-4.15%) | Single family housing starts (-12.73%) | Housing prices (-3.53%) | Industrial production (-9.44%)
8.2008 (“Expansion”): Employment (+0.4%) | Single family housing starts (-33.6%) | Housing prices (-4.47%) | Industrial production (-0.38%)

Boston MSA Strengths
-Business capital of New England.
-Access to skilled labor force and venture capital for emerging companies.
-Dynamic high-tech and biomedical research and development industries.

Boston MSA Weaknesses
-Very high business and living costs.
-Weak population growth.
-Highly exposed to cyclical financial and tech industries.

Note: The employment, housing, and industrial figures above are three month averages.
For more information about the Moody Adversity Index: http://www.msnbc.msn.com/id/29866676

Recession Recovery? Innovation, People, and Place Matter

A FEW KEY QUOTES: New Ways of Living and Working Will Drive Post - Crash Prosperity – with Richard Florida, Author ‘The Rise of the Creative Class’

“Economies and societies invariably remake themselves in the wake of a crisis. It’s a necessary component of rebound and recovery.”

“…place and geography has a significant impact on economic systems. With this Great Reset (The Recession of 2008-09), we will see an even greater emphasis on place – more specifically the rise of the mega region, which are new and incredibly powerful economic units. No longer will we focus on the city versus suburb but on how to increase our connection to our respective mega regions.”

“The First Reset (1870) saw power and communication grids and streetcar and subway systems spread across the country, speeding the movement of goods, people, and ideas. The Second Reset (1930) brought huge developments in media, mass-produced consumer goods, and the role of large corporations, when companies like IBM rose to prominence and when what was good for General Motors was good for the nation.” [Note: The Resets of 1870 and 1930 are references to the Panic of 1873 and the Great Depression.]

“Most importantly, cities have to recognize that in times of crisis they have to help themselves. Governments, no matter how well intentioned, can only do so much, especially when they themselves are so strapped for cash…Every city has hidden seeds of opportunity waiting to be nurtured.”

(About the Sunbelt) “The boom in housing and the influx of population generated a thriving retail and service economy, but there were no economic drivers underpinning it all. There was nothing to generate new capital, only the capital that people were bringing with them. When that bubble burst, there was nothing to fill the gap. The potential solutions in the Sunbelt aren’t much different from those in the Rust- Belt: Build on real underlying economic strengths and tap into the creative core in the existing population and its valuable human capital.”

“For the first time in human history, the basic logic of our economy dictates that further economic development requires the further development and use of human creative capabilities. The great challenge of our time is to find ways to tap into every human’s creativity”

“Places like Detroit, Cleveland, and Pittsburgh are among my favorite cities. They have great universities, clusters of innovation across a range of industries, and pools of innovative and creative talent to build on. They need to stop their penchant for megaprojects like new stadiums…and stop depending on federal bailouts. They need to understand that rebuilding takes a generation or two – it will not happen overnight – and that it has to come from building upon local strengths and capabilities organically.”

“Transportation systems that are fast and efficient and environmentally clean are going to enable the formation of these new mega-regions…We need to be able to accelerate the movement of people, goods, and services – the very movement of ideas, knowledge, and creativity – between our major population centers.”

Read Bob Morris' complete interview about The Great Reset with Richard Florida on the Wall Street Cheat Sheet http://bit.ly/thegreatresetwsj

Regional assets: Northeast Florida, success to build on

Active Market Sectors
Financial: German-based Deutsche Bank, which commenced operations in Jacksonville in 2008, hired an additional 250 employees in 2010 — another step toward meeting its commitment to create a total of 1,000 jobs for the region. In addition, Maitland-based Digital Risk has announced plans to open a service center in Jacksonville and hire a minimum of 175 employees. The company monitors and manages loan portfolios and detects loan fraud, reviewing approximately 14,000 loans per month.

Energy: InEnTec Chemical moved its corporate headquarters from Bend, Ore., to Clay County in 2010. The company's manufacturing facilities convert both hazardous and non-hazardous commercial, medical and industrial waste materials into clean, renewable energy products such as ethanol, methanol, syngas and hydrogen with minimal environmental impacts and low costs. InEnTec officials note that the Northeast region offered the perfect location to tap into the scientific expertise available at Florida's leading research universities as well as an ever-growing clean technology talent pool.

Aviation/aerospace: Aviation Systems Engineering has added 10 high-paying jobs to its Jacksonville branch office. The company specializes in aviation system development and analyses and has contracts with the U.S. Department of Defense. AvMax Group is opening a heavy maintenance and modification facility to serve the region's jet and turboprop aviation industry at Jacksonville International Airport. The facility will initially employ as many as 100 to 120 licensed aircraft mechanics.

Healthcare: Northeast Florida's already strong healthcare economic engine continues to surge forward. Hospital giant Health Care Association of America (HCA) is building a new $130-million hospital near Cecil Commerce Center, and Baptist Medical Center is adding a $200-million, 11-story tower to its existing campus.

World-renowned Mayo Clinic Jacksonville has so many international patients that it has established an office dedicated to meeting their special needs. Nine full-time staff members assist patients and families by scheduling appointments; translating medical documents; and providing concierge services for travel arrangements to and from Jacksonville and around the metropolitan area once they arrive.

International Business
Thanks to Florida's location at the center of the Western Hemisphere, trade with countries in the Caribbean and in Central and South America has become practically seamless. In recent months, Cornerstone inked a deal to promote business opportunities with Ireland and is currently working with the group Atlantic Way Region.

In addition to Saft America, other companies with foreign investment interests that are thriving in Northeast Florida include:

• Mercedes Benz USA, which has opened a 400,000-square-foot parts distribution center at Jacksonville International Tradeport. The venture represents a $26-million capital investment for Mercedes Benz.
• Hanjin Shipping Company of Seoul, Korea, which is building a 90-acre container facility at the Dames Point Marine Terminal at the Port of Jacksonville. Hanjin joins Tokyo-based Mitsui OSK Lines (MOL), which opened its TraPac Container facility at JAXPORT in 2009.

Affordability
Florida's Northeast region remains one of the state's most affordable places to live. According to research data compiled by the National Association of Realtors for the first quarter of 2010, the median sale price for existing single-family homes in the Jacksonville Metropolitan Statistical Area was $144,900. The median sale price during the same period for condominiums and cooperatives was $79,700.

Jacksonville Electric Authority (JEA), one of the nation's largest municipal utilities and the largest community-owned utility in Florida, is this region's primary provider of electricity, water and wastewater service. Serving most of Duval County as well as portions of Nassau, St. Johns and Clay counties, JEA boasts some of the lowest rates in Florida.

Source: Business Florida 2011 - The Regions. Northeast - Connecting to the World. Northeast Florida offers international companies the right mix of amenities and global connections. http://www.floridatrend.com/biz_fl_article.asp?page=1&aID=53633

Northeast Florida's regional assets: Saft America Inc.

Peter Denoncourt says there wasn't one particular thing that stood out about Northeast Florida when Saft America Inc. went looking for a new location to build a manufacturing plant for its lithium-ion batteries; it was a combination of factors that made this seven-county region attractive.

Two-thirds of the 50 million people living in the southeastern United States are within 600 miles of this region, which is home to more than 80 corporate, regional and divisional business headquarters; a combination of quiet neighborhoods and bustling urban centers; miles of pristine Atlantic coastline; and a wealth of cultural and recreational opportunities, not to mention America's oldest city — St. Augustine. And with three interstate highways, three major rail lines, two deepwater ports and four marine terminals, Northeast Florida offers some of the best transportation options available.

Since Saft America plans on using its new factory as a "showcase" to both domestic and international clients interested in alternative energy sources, convenience played heavily into the site decision. Jacksonville International Airport, with 200 arrivals and departures daily, provides easy access to the factory, which is located at nearby Cecil Commerce Center North.

Saft America Inc. already has five manufacturing plants in the southeastern U.S., mostly in rural areas. However, for this new 235,000-square-foot factory for the production of lithium-ion batteries, the company required a more sophisticated site and Jacksonville seemed the perfect fit, says Denoncourt. "This city has more of an international feel."

"We expect to do a lot of work,'' Denoncourt says, noting that at full capacity, the Jacksonville facility will produce an estimated $300 million worth of batteries annually. To meet demand, Saft is expected to hire as many as 280 workers at salaries that are approximately 15% above the average statewide wage. Many of the hires, Denoncourt adds, will likely be drawn from the region's plentiful pool of former military employees.

More Regional Assets
Universities/Colleges: Edward Waters College, Flagler College, Florida State College at Jacksonville, Jacksonville State University, St. Johns River Community College, and the University of North Florida
Airports: Jacksonville International Airport and Northeast Florida Regional Airport at St. Augustine
Seaports: Port of Fernandina and Port of Jacksonville
Spaceport: Cecil Field Spaceport

Source: Business Florida 2011 - The Regions. Northeast-Connecting to the World. Northeast Florida offers international companies the right mix of amenities and global connections. http://www.floridatrend.com/biz_fl_article.asp?page=1&aID=53633   

Economist speaks to JCCI about recession recovery in Northeast Florida

Below is an excerpt from Karen Brune Mathis' interveiw with Dr. Sean Snaith, Director of the Institute for Economic Competitiveness within the College of Business Administration at the University of Central Florida. Dr. Snaith spoke at JCCI's Annual Meeting on 9-29-2010. Check out the full story at the Financial News and Daily Record online http://www.jaxdailyrecord.com/showstory.php?Story_id=531975

What is your message to JCCI as it embarks on a new study about the recovery and how Jacksonville should position itself? We are in a recovery following a deep and prolonged recession, so we need to temper our expectations. The damage that was done, particularly to consumers’ wealth via the housing market and the stock market, has unfortunately put consumers in a bit of a retrenchment mode to save and try to build those nest eggs back up. When consumers are saving more, they are spending less. Consumer spending is 70 percent of our national economy, so we will have that chunk of the economy growing, but not at a robust pace.

Will Jacksonville’s economy recover more quickly, slowly or at the same pace as Florida recovers? Jacksonville did not suffer to the same extent in the housing cycle. It was not as pronounced as other parts of the state…the damage is less severe than in other parts of the state. I think it will recover at the pace of the Florida recovery, if not a little faster. I think the lower cost of living in Jacksonville relative to some areas will be beneficial. Going forward, in terms of attracting retirees, that element of Florida’s economy and the influx of retirees have really been damaged by the housing market and what happened in the stock market. It will change many retirees’ plans in terms of timing and what type of retirement they will be able to afford.

Speaking of Florida, is it out of the recession? Will it recover more slowly, quickly or at the same rate as the nation? In Florida, there is no official group to declare this. My contention is that Florida came out of the recession in the first quarter this year. That being said, I’ve referred to the labor market for some time as the scar that’s left over from the financial and economic trauma. That scar is a pretty ugly one and it is not going to fade quickly. We are going to be dealing with the aftermath with respect to the labor market for many years. We think unemployment will be in double digits until the second half of 2012 and payrolls will not recover to their pre-recession levels until 2014. We are looking at a very pronounced and prolonged cycle and a long period of recovery, unfortunately. Job growth has not resumed very strongly in the private sector. We are likely to see the unemployment rate drift up a few tenths of a percent before its long and gradual decline.

Is there or will there be a double dip recession? Last year our second quarter forecast said the recession is over but the recovery is shaped like a gravy boat where you see the handle, you plunge deep down and the recovery would be the gradual tapered spout, slow and protracted. There was a pseudo-V at the end of last year and the first three months of this year. It was directed by inventory cycles and over the course of the recession, businesses were slashing, inventories. No one was buying. They stopped slashing and (that) gave us a big boost of 5 percent of Gross Domestic Product growth in the fourth quarter and 3.7 percent growth (in the first). Inventory cycles are transitory and they are not the stuff that sustains strong recoveries and that is what we are seeing, (the results of) that inventory boost rather than the emergence of a double dip. It is the recovery displaying its true nature. With the housing and stock market, the damage is not going to be undone overnight. The extent of the damage is severe. When you go through that kind of trauma, the recovery is not rapid. It is slow, it is protracted and there’s therapy involved.

What specifically should Jacksonville and Northeast Florida do, or anticipate, as it positions itself for creating jobs in the future? What are the strengths? I think the transportation and warehousing sectors are one of the region’s real strengths. As the Panama Canal widening becomes complete and we get those ships coming through, there is real opportunity for Jacksonville, and Florida in general, to take a large step forward in terms of growing international trade. That means we need to invest in our ports, in our rails, in our highways. That kind of government spending provides returns over time.

Need capital? Florida has angels!

In April 2008, Craig Reilly was ready to take the next step. Reilly and his two partners had gotten the company that far with their own money but had begun looking for investors to fund more growth.

Reilly turned to a group called the Winter Park Angels — an organization comprised of affluent local residents who had come together to fund local startups and emerging companies.

Five months later, 19 members of the angel group had invested a total of $750,000. Reilly was able to expand even as the financial markets crashed and financing options evaporated. Reilly’s company, Plus-One Solutions has met its growth targets and is about to undergo another financing round to fund more expansion.

The Winter Park investment group is just one of at least nine local angel bands that have emerged in the past several years, meeting formally or informally to pool money and invest in local startups. Two new angel funds formed in Florida in the last year with more than $1 million each to spend on both initial funding and later-stage expansion.

Angel investors, either as individuals or groups, typically look for entrepreneurs who want to build a company then sell it. For their investment, the angels get a share of ownership, looking for a return of as much as 30 times their initial investment within seven years.

Meanwhile, for Florida businesses, angel groups help to mitigate the traditional lack of capital for promising new businesses in the state. "For entrepreneurs, it's the smartest money you can get," says Rhys Williams, president and co-founder of New World Angels, a Boca Raton group. "You could be getting 40 investors committed to your success who use their networks to grow the company and who will help you find the next round of capital."

In Florida, the oldest angel investment fund is in Jacksonville. Springboard Capital has invested in 12 startup companies over the last decade. The group began informally, a cadre of friends talking deals over sandwiches, and later organized as a fund when 45 members put up at least $50,000 each. The group formed a second fund a few years later.

For the most part, angels like to invest in companies whose business they know something about. In Orlando, for example, Catapult Capital has tapped into breakthrough technologies and entrepreneurial deals vetted by the University of Central Florida venture lab and Rollins College.

A new fund in southwest Florida, Tamiami Angel Fund, has members with varied backgrounds and wants early-stage, pre-revenue companies with evidence of customer demand or businesses looking to expand.

At least two of the angel groups in Florida seek women-owned business. Go Beyond Network in Naples and Women Angels in Miami, both founded by women, see opportunity in this fast-growing sector. Barbara Boxer, founder of Women Angels, says the economic downturn has proved to be a great time for angel groups with cash to spend.

Others funds prefer to invest in one industry. A group of Miami angels led by healthcare entrepreneur Mike Fernandez formed the $20-million MBF Healthcare Fund aimed at investing in healthcare startups in Florida.

Sean Christiansen of Catapult Capital in Orlando says his angel group wants to raise awareness that the groups are a viable, local financing source: "Historically, Florida has lost companies because they went to venture capital firms who prefer local businesses, and most of those firms were not in Florida."

These days, startups most attractive to angels tend to be in information technology, web 2.0 and social media, life sciences, medical devices and medical-related software. Williams, of New World Angels, says the most important factor for angels is not the industry sector but the presence of smart managers with experience building a business.

Read the entire article, “Bands of Angels: Local groups of investors are forming all over Florida, providing funding to capital-starved emerging companies” (10.1.10) by Cindy Krischer Goodman at Florida Trend online http://www.floridatrend.com/article.asp?aID=53691&parentID=53781

Job growth in the service occupations + An increase in self-employment

According to the United States Census Bureau (American Community Survey) from 2008 through 2009 the Jacksonville Metropolitan Statistical Area suffered a net loss of 31,911 jobs, as measured by the "civilian employed population 16 years and over." Despite those losses, gains were made in some areas, especially in service occupations and speciality service industries. There was an uptick in the number of people starting businesses as well.

BY OCCUPATION
Occupations making gains from 2008 through 2009
-Service occupations (4,396)
-Farming, fishing, and forestry occupations (1,195)

Occupations suffering losses from 2008 through 2009
-Construction, extraction, maintenance, and repair occupations (-12,791)
-Sales and office occupations (-12,470)
-Management, professional, and related occupations (-6,677)
-Production, transportation, and material moving occupations (-5,564)

BY INDUSTRY
Industries making gains from 2008 through 2009
-Professional, scientific, and management, and administrative and waste management services (5,264)
-Educational services, and health care and social assistance (1,827)
-Agriculture, forestry, fishing and hunting, and mining (311)

Industries suffering losses from 2008 through 2009
-Retail trade (-11,808)
-Construction (-9,026)
-Other services, except public administration (-5,213)
-Transportation and warehousing, and utilities (-5,152)
-Public administration (-2,239)
-Information (-1,961)
-Arts, entertainment, and recreation, and accommodation and food services (-1,438)
-Finance and insurance, and real estate and rental and leasing (-1,079)
-Manufacturing (-829)
-Wholesale trade (-568)

BY CLASS OF WORKER
-Private wage and salary workers (-32,876)
-Government workers (-2,894)
-Self-employed in own not incorporated business workers (3,720)
-Unpaid family workers (139)

Other information about industries and occupations from the 2009 American Community Survey for the Jacksonville MSA

INDUSTRIES: In 2009, for the employed population 16 years and older, the leading industries in the Jacksonville, FL Metro Area were Educational services, and health care, and social assistance, 20%, and Finance and insurance, and real estate and rental and leasing, 12%.

OCCUPATIONS AND TYPE OF EMPLOYER: Among the most common occupations were: Management, professional, and related occupations, 35%; Sales and office occupations, 29%; Service occupations, 18%; Production, transportation, and material moving occupations, 9%; and Construction, extraction, maintenance, and repair occupations, 8%.

82% of the people employed were Private wage and salary workers; 13% were Federal, state, or local government workers; and 5% were Self-employed, in own not incorporated business, workers.

Source: Economic Data - 2008 American Community Survey 1-Year Estimates and 2009 American Community Survey 1-Year Estimates; http://factfinder.census.gov/ – Jacksonville, FL MSA

STEM education upgrade, not necessarily a job creation engine

Tariff-free trade policies are great because they increase commerce, and we can mitigate those policies' negative effects on the blue-collar job market by upgrading our education system to cultivate more science, technology, engineering and math (STEM) specialists for the white-collar sector.

Known as the bipartisan Washington Consensus, this deceptive theory projects the illusion of logic. After all, if the domestic economy's future is in STEM-driven innovation, then it stands to reason that trade policies shedding "low-tech" work and education policies promoting high-tech skills could guarantee success.

No doubt, you've heard this fairy tale from prominent politicians and business leaders who incessantly insist that our economic troubles spring from an education system that is supposedly no longer graduating enough STEM experts.

It sounds vaguely logical, except, the lore relies on the assumptions that 1) American schools aren't generating enough STEM supply to meet employer demand, 2) the education system — not neoliberalism — is driving this alleged STEM drought and 3) if America came up with more of such specialists, they would find jobs.

Consider a recent study by Rutgers and Georgetown University that found colleges "in the United States actually graduate many more STEM students than are hired each year."

As researchers discovered, many students are pursuing finance instead of STEM careers because Wall Street jobs "are higher paying" and offer "employment stability" and "less susceptib(ility) to offshoring."

This is the truth that the Great Education Myth aims to obscure. It's not that schools are ill-equipped to train STEM specialists. It's that the students who might boost our STEM workforce are choosing to avoid STEM majors because they see an economy that is more hospitable to careers in Wall Street casinos rather than in high-tech innovation — a financialized economy based less on creating tangible assets than on encouraging worthless speculation.

This doesn't mean that our education system is perfect. But it does mean that without reforming the trade, tax and regulatory policies that reward high-tech outsourcing and incentivize careers in finance, our schools can never be an engine of value-generating information-age jobs.

Tariff-free trade pacts inflate the profits of transnational businesses by helping them troll the globe for cheap exploitable labor. Loopholes exempting foreign earnings from taxes encourage companies to move jobs overseas. And both deregulation and bailouts disproportionately balloon financial industry revenues.

The neoliberal corporate class makes big money off this status quo and neoliberal lawmakers get their cut via campaign contributions. The last thing either wants is an honest debate about neoliberalism's downsides. And so they play to our lust for silver-bullet solutions, endlessly telling us that everything is the schools' fault.

Read David Sirota’s entire article, “The Neoliberal Bait-and-Switch”, online at http://www.creators.com/opinion/david-sirota/the-neoliberal-bait-and-switch.html

Check out Michelle Martin’s interview (Tell Me More at NPR) with this article’s author David Sirota and finance expert Alvin Hall http://www.npr.org/templates/story/story.php?storyId=130188617

Economic Gardening? -or- Economic Hunting?

Economic Gardening, a strategy that focuses on nurturing second stage growth companies and growing an economy from within, has caught the attention of many economic developers. Over 700 communities have contacted Littleton, Colo., where the concept originated, to learn more about the project.

The program has helped entrepreneurs double the job base in Littleton from 15,000 to 30,000 and triple the retail sales tax from $6 million to $21 million over the past 20 years. At the same time, the population only grew 23 percent over those two decades.

Littleton’s project began with the idea that "economic gardening" was a better approach than "economic hunting." This means growing jobs locally through entrepreneurial activity, rather than recruiting those jobs. The idea was based on research by David Birch at MIT. His research revealed that that the great majority of all new jobs in any local economy were produced by the small, local businesses in the community. While recruiting coups draw major newspaper headlines, they typically represent less than 5 percent of the jobs created in most local economies.

In developing its "economic gardening" project, Littleton's economic development team found that for every successful recruiter who represents a hot office/industrial park in a major metropolitan area, there were literally hundreds of economic developers in rural areas, inner cities, and small towns who struggled without much real success. Similarly, if an outlying area was successful at attracting new industry, it seemed to be a certain type of business activity: the branch plant of industries that competed primarily on low price and thus needed low cost factors of production. Rural towns with cheap land, free buildings, tax abatements and especially low wage labor would "win" these relocating businesses. Experience indicates that these types of expansions stay around as long as costs stayed low. If the standard of living starts to rise, the company pulled up stakes and headed for locations where the costs were even lower, often Third World countries.

Many communities are struggling to regain a sense of control over their future, and see investments in local entrepreneurs as less risky and more certain than continuing to play the high stakes recruiting game. Still, Economic Gardening is not a quick answer to a plant shutting down: These strategies take time to put into place and time to reach a critical mass of growing companies.

The three basic elements of Economic Gardening are:
1. Providing critical information needed by businesses to survive and thrive.
2. Developing and cultivating an infrastructure that goes beyond basic physical infrastructure and includes quality of life, a culture that embraces growth and change, and access to intellectual resources, including qualified and talented employees.
3. Developing connections between businesses and the people and organizations that can help take them to the next level — business associations, universities, roundtable groups, service providers and more.

An entrepreneurial approach to economic development has several advantages. First, cost per job is much less than the $250,000 to $300,000 incentives typical in major relocations. Second, the investment is in the community and its infrastructure; should a business choose to leave, they do not take that investment with them. Third, it is a healthier approach in that a community’s future is no longer tied to the whims of an out of state company. Its future is entirely a function of its own efforts and investments.

Click on the links below for more information on Economic Gardening

A Local Perspective: Littleton’s Economic Gardening Strategy
http://www.nlc.org/articles/articleItems/NCW011110/gibbonslocalperspective.aspx

An Entrepreneurial Approach to Economic Development
www.littletongov.org/bia/economicgardening/

Economic Gardening: Next Generation Applications for a Balanced Portfolio Approach to Economic Growth
http://www.sba.gov/advo/research/sbe_06_ch06.pdf  

Florida’s Economic Gardening Program
http://www.growfl.com/

Northeast Florida Economic Gardening Program
http://www.secondstagebusinessdevelopment.com/

Targeted occupations: Where the jobs are?

The Florida Agency for Workforce Innovation released the “2010-11 Regional Targeted Occupations List” for its statewide workforce regions, including the six-county area of Baker, Clay, Duval, Nassau, Putnam and St. Johns.

A review of targeted jobs for the Jacksonville area finds that the fastest-growing occupations are in computers and maintenance, while the highest-paid entry-level jobs are computer and information-systems managers.

To be considered a targeted job the criteria called for jobs with required certification or community college credit or a degree; at least 25 annual job openings and positive growth; and an average hourly wage of at least $12.80 and an average minimum hourly entry wage of about $10.40. High-skill, high-wage occupations are those with at least an average hourly wage of $20.06 and an average hourly entry wage of $12.80.

In the Jacksonville region, the top 10 targeted occupations among three measures:
• By entry-level hourly wage, all 10 were high-skill, high-wage, led by the computer and information-systems managers at an entry-level wage of an average $41.71. However, the agency reported just 26 openings a year.

The highest number of openings at the highest average entry-level pay came in the category of medical and health services managers, at $30.25 an hour with 367 openings a year.

• The top targeted jobs ranked by annual percentage growth were led by network systems and data communications analysts. The annual percentage growth in those jobs was reported at 4.76 percent, with an average hourly entry wage of $22.38. The second was medical assistants, at 4.22 percent and $10.96.

• The top jobs by the number of annual openings was the category of general maintenance and repair workers, at 1,423 openings a year at an average entry-level pay of $10.36 an hour. Customer service representatives came in second at 1,026 openings a year at entry pay averaging $11.03.

Click here for a full list of targeted occupations for 2010-11 or check out the Recommended Reading list to your right.

Read the full article online, “Targeted jobs and where to find them” (9-21-10) by Karen Brune Mathis at the Financial News and Daily Record go to 
http://www.jaxdailyrecord.com/showstory.php?Story_id=531919  

NE FL's #1 Economic Issue? Jobs and Unemployment!

A recent survey by the First Coast Manufacturers Association, found that businesses and the general public agree on their number 1 concern - jobs and unemployment.

Top economic issues facing Northeast Florida
What do you think are the top three economic issues facing Northeast Florida today? (Multiple responses accepted; 12 issues identified.)

Businesses:
Jobs/unemployment 46%
Education/training of workforce 19%
Housing market 16%

General public:
Jobs/unemployment 55%
Slow real estate market 19%
(Tie) Housing market 17%
(Tie) Health care costs 17%

Strongest industries in Northeast Florida
Among 15 listed industries, which ones do you feel are stronger sectors for the economy of Northeast Florida, which are weaker and which are about average compared to the United States as a whole? Think in terms of a typical business year when the economy is not in recession. Top three considered stronger than average

Businesses:
Health care 44%
Agriculture, forestry, fishing and hunting 32%
Transportation and warehousing 29%

General public:
Health care 29%
Agriculture, forestry, fishing and hunting 25%
Transportation and warehousing 17%

Performance of the regional economy
Compared to one year ago (mid-2009), do you think that the regional economy of Northeast Florida is getting better, getting worse or is about the same as it was one year ago?

Businesses:
About the same 43%
Getting better 40%
Getting worse 14%
Not sure/no response 3%

General public:
About the same 39%
Getting worse 37%
Getting better 20%
Not sure/no response 4%

High-priority industries
How would you like to see the economy of Northeast Florida develop over the next 10 years? Of industries listed, indicate whether you would make the industry a high priority, medium priority or low priority for economic development. Top high-priority industries

Businesses:
(Tie) Manufacturing 65%
(Tie) Health care 65%
Professional, scientific and technical services 60%
Information technology 59%

General public:
Health care 70%
Information technology 57%
Professional, scientific and technical services 48%

Career recommendations
If your child or another young person came to you for advice on choosing a career, which of the following industries would you be most likely to encourage them to consider? (Respondents could choose up to three from a list of 11.)  Top three responses

Businesses:
Information technology 61%
Health care 51%
Professional, scientific and technical services 50%

General public:
Health care 63%
Information technology 61%
Professional, scientific and technical services 45%

Facilities to support
If an employer could create 1,000 new jobs in Northeast Florida by establishing a new business facility, what type of business facility would you support? (Respondents could choose up to three from a list of 10.) Top responses

Businesses:
Manufacturing 52%
(Tie) Professional, scientific and technical services 44%
(Tie) Information technology 44%
(Tie) Transportation and warehousing 30%
(Tie) Health care 30%

General public:
(Tie) Information technology 45%
(Tie) Health care 45%
Professional, scientific and technical services 38%
Manufacturing 30%

Ulrich Research Services Inc. of Orange Park prepared the survey, which involved 252 business respondents invited by regional and county chambers of commerce and 228 members of the general public. Neither group knew the manufacturers’ association was the sponsor of the survey.

Read the entire article, "Jobs No 1 Issue",  by Karen Brune Mathis and featuring an interview with Lad Daniels (Former Jacksonville City Council President and First Coast Manufacturers Association President) at the Financial News and Daily Record
http://www.jaxdailyrecord.com/showstory.php?Story_id=531884

The Future of Northeast Florida

On September 8, 2010 Jack Manilla, representing the Florida Chamber Foundation, engaged attendees at the JCCI Issues and Answers forum in a discussion about Northeast Florida’s assets and liabilities.

The goal? Provide feedback to Foundation’s project to develop strategies and tactics that will get Florida back to work by making the State and its unique regions more economically competitive.

What else would you add to these lists?

Assets existing in our community that provide a (preferably) unique global competitive advantage: The St. Johns River. Multiple transportation resources (i.e. Interstate System, Rail, Waterways). Jacksonville’s logistical location. Military bases. Military veteran workforce. Jaguars. Attractive climate. Diverse geographic communities (urban, rural, oceanfront, riverfront). Medical centers and resources. Diverse business sectors. Strong regional focus/Cornerstone. Consolidated city/county government (Jacksonville). Multiple higher education institutions. Unique quality of life. Visually beautiful city. Efficient and well-maintained airport. Cecil commerce center.

Critical Factors if not addressed will impede our economic growth in the next 5 years / 20 years: Continuous inability to capitalize on the community’s assets. Poor leadership. Lack of business news that positively influences consumer and corporate decisions. Inability to hire educated workers. Too little focus on math, science, and technology in local k-20 education system. Lack of a major research university. Too little effort on improving the mental health system. Regional mass transportation. Tax avoidance policies. Lack of focus on water conservation.

Critical Factors needed to accelerate our economic growth in the next 5 years / 20 years: Focus on efficient and effective regional decision making. Recognition of the region as an economic force by making reference to the “Jacksonville Region” or “Jacksonville Area”. Focus on relaying positive business news for consumers and businesses. Highlight and capitialize on the positive aspects of the regional community. Require that those in City leadership have a master’s level education. Involve diverse people (age, background, views) in leadership and decision making roles. Host a major research university like other regions in the state.

Please read: http://www.flfoundation.org/  “About”, “Pillars – Innovation”, “Pillars - Caucus System”, “Scorecard”

Manufacturing? A solution for a recession resilient economy?

China and Germany are clear winners in the Great Recession: In China suppressed wages are increasing for millions of industrial workers and the country’s stimulus -- effectively the world's largest -- has funded bullet trains, airports and wind turbines. Thanks to its favorable trade balance (exports remain high), Germany's finances are the strongest in Europe, which is why German monetary guarantees have been key to the future of both Greece and the euro.

These two countries do not have much in common; Germany has a mature economy and is a stultifyingly stable democracy. China has a rising economy and remains disturbingly authoritarian. What sets them apart from the world's other major powers, purely and simply, is manufacturing. Their predominantly industrial economies meet their own needs and those of other nations, and have made them flourish while others flounder. In 1960 the same could be said of the United States when manufacturing accounted for a quarter of our gross domestic product and employed 26 percent of the labor force. Today, manufacturing has shriveled to 11 percent of GDP and employs a kindred percentage of the workforce.

Until 2001, the United States exported more advanced technology than it imported, but since then the United States has been running annual high-tech deficits that reached $61 billion in 2008. Worse yet, as we lose manufacturing, which employed 63 percent of our scientists and engineers in 2007, we lose many of our most valuable professionals. Last year, reported Business Week, the number of employed scientists and engineers fell 6.3 percent while overall employment fell 4.1 percent.

Many Americans believe we're losing manufacturing because we can't compete against cheap Chinese labor. But Germany has remained a manufacturing giant notwithstanding the rise of East Asia, making high-end products with a workforce that is more unionized and better paid than ours. German exports came to $1.1 trillion in 2009 -- roughly $125 billion more than we exported, though there are just 82 million Germans to our 310 million Americans. Germany's yearly trade balance went from a deficit of $6 billion in 1998 to a surplus of $267 billion in 2008 -- the same year the United States ran a trade deficit of $569 billion. Over those same 10 years, Germany's annual growth rate per capita exceeded ours.

Read the entire article, "In recession battle, Germany and China are winners", by Harold Meyerson at The Washington Post online (July 1, 2010)
http://www.washingtonpost.com/wp-dyn/content/article/2010/06/30/AR2010063004199.html

Education offers a great deal of protection against unemployment

Unemployment rates vary by level of education locally
In the Jacksonville Metropolitan Statistical Area, the unemployment rate for people without a high school diploma was almost double the rate for high school graduates and those with some college or an associate's degree AND four times higher than those who had earned a bachelor’s degree or higher.

2008 American Community Survey (Jacksonville MSA)
Less than a high school graduate
# Unemployed: 5,720
Unemployment rate: 11.9%

High school graduate
# Unemployed: 8,952
Unemployment rate: 5.6%

Some college or an associate’s degree
# Unemployed: 10,994
Unemployment rate: 5.3%

Bachelor’s degree or higher
# Unemployed: 4,282
Unemployment rate: 2.7%

B23006. EDUCATIONAL ATTAINMENT BY EMPLOYMENT STATUS FOR THE POPULATION 25 TO 64 YEARS; Data Set: 2008 American Community Survey 1-Year Estimates; Survey: American Community Survey.

Unemployment rates increase as the level of education decreases: This is a national trend.

Bureau of Labor Statistics Unemployment Rates (United States)
Less than a high school diploma
July 2010 – 13.0% | 2009 Annual – 14.6% | 2008 Annual – 9.0%

High school graduates, no college
July 2010 – 9.9% | 2009 Annual – 9.7% | 2008 Annual – 5.7%

Less than a bachelor's degree
July 2010 – 8.6% | 2009 Annual –8.0% | 2008 Annual – 4.6%

College graduates
July 2010 – 5.0% | 2009 Annual – 4.6% | 2008 Annual – 2.6%

Table A-4. Employment status of the civilian population 25 years and over by educational attainment
http://www.bls.gov/webapps/legacy/cpsatab4.htm

What should communities do?
-Create jobs for and build/attract companies that hire workers with low levels of education?
-Implement policies that increase educational attainment for the community’s adults?
-What else?

Note: The Jacksonville MSA includes Duval County (Jacksonville and the cities of Jacksonville Beach, Atlantic Beach, Baldwin and Neptune Beach), Clay County, St. Johns County, Nassau County and Baker County.

Focus on bolstering local businesses? A solution for job growth/job creation?

The Metro Orlando Economic Development Commission (EDC) is shifting its focus from recruiting out-of-state businesses with big-bucks incentives to helping local companies grow.

Maureen Brockman, the commission's vice president of marketing and communications, said one of the group's goals is to "increasingly re-energize and reinvigorate our own existing industry-outreach program.

"I think people are recognizing there is a new normal, and we can't expect our economies to be built from the outside in," she said, adding that the commission has already embraced what is a national trend toward "economic gardening."

About 60 percent to 70 percent of the region's job growth already comes not from companies relocating to Central Florida but from businesses already here, Brockman added.

Chris Schmidt, a former deputy executive director at Orlando International Airport, said the region's troubled housing market has made it difficult to recruit workers from other cities. So educating and training workers from Central Florida is key to corporate expansion and employment growth, he said.

"One of the things that has to be focused on in the future — in my view — is Central Florida-based work-force growth," said Schmidt, now a consultant with Knob Hill Group. "Helping the people here grow so they've got more education, so they can take on more responsible jobs, as jobs are created here."

The EDC is seeking a new president who can bolster local business and build regional bridges "As part of this work, it has become apparent that the primary role of the president and CEO should be to strengthen relationships with our community leaders and mobilize them around shared goals," said Meg Crofton, the commission's chairwoman and president of Walt Disney World.

Regionalism hasn't always worked well for Metro Orlando, whose four counties have squabbled about things such as construction of a beltway around the city and other issues.

See the full story, “New strategy for adding jobs to Orlando region: Focus on boosting local companies, not luring others” (8-22-2010), at the Orlando Sentinel online http://www.orlandosentinel.com/business/os-edc-new-direction-20100820,0,4969277.story  

Important Local Note: One of the key findings from JCCI Forward's Job Growth Issue Forum held in 2003 was, "Eighty percent of all new jobs in Jacksonville are produced by existing businesses. These businesses do not receive the same attention, support, and services by the local public and private partners as new or relocating businesses."

Shopping local? A solution for job growth/job creation?

The City of New Orleans' Stay Local! initiative encourages people to act locally with regard to culture, commerce, and the environment. In June 2010 the unemployment rate in New Orleans was 8.2 percent, while the unemployment rates in Northeast Florida’s counties range from 9.6 to 15.4 percent. Is shopping local one of the solutions for economic sustainability and job creation?

Check out these reasons to shop locally from Stay Local! in New Orleans

1. Protect Local Character and Prosperity
New Orleans is unlike any other city in the world. By choosing to support locally owned businesses, you help maintain New Orleans’ diversity and distinctive flavor.

2. Community Well-Being
Locally owned businesses build strong neighborhoods by sustaining communities, linking neighbors, and by contributing more to local causes.

3. Local Decision Making
Local ownership means that important decisions are made locally by people who live in the community and who will feel the impacts of those decisions.

4. Keeping Dollars in the Local Economy
Your dollars spent in locally-owned businesses have three times the impact on your community as dollars spent at national chains. When shopping locally, you simultaneously create jobs, fund more city services through sales tax, invest in neighborhood improvement and promote community development.

5. Job and Wages
Locally owned businesses create more jobs locally and, in some sectors, provide better wages and benefits than chains do.

6. Entrepreneurship
Entrepreneurship fuels America’s economic innovation and prosperity, and serves as a key means for families to move out of low-wage jobs and into the middle class.

7. Public Benefits and Costs
Local stores in town centers require comparatively little infrastructure and make more efficient use of public services relative to big box stores and strip shopping malls.

8. Environmental Sustainability
Local stores help to sustain vibrant, compact, walkable town centers-which in turn are essential to reducing sprawl, automobile use, habitat loss, and air and water pollution.

9. Competition
A marketplace of tens of thousands of small businesses is the best way to ensure innovation and low prices over the long-term.

10. Product Diversity
A multitude of small businesses, each selecting products based, not on a national sales plan, but on their own interests and the needs of their local customers, guarantees a much broader range of product choices.

Stay Local New Orleans: http://www.staylocal.org/facts/why/
Unemployment information: "New Orleans gained 1,700 jobs in June" The Times Picayune
http://www.nola.com/business/index.ssf/2010/07/new_orleans_unemployment_rate_2.html

Unemployment in Florida falls to 6% by 2018?

Florida's job market is headed the wrong direction again, and there's growing concern it may get a little worse before it gets better.

The state's unemployment rate ticked up slightly to 11.5 percent in July, reversing three months of declines. A statewide group of economists predicts the rate will move up to 11.8 percent later this year when more discouraged job seekers now on the sidelines re-enter the market and federal stimulus dollars dry up.

Florida's unemployment rate, up from 11.4 percent in June, translates to more than one million jobless out of a labor force of 9.2 million. Add in discouraged Floridians not counted as looking and part-timers unable to find full-time jobs, and the broader unemployment rate would be 19.8 percent, state officials said.

In a media conference call, AWI chief economist Rebecca Rust said mixed signals are typical in the "trough" of a recession. She called it more likely "a lull in the recovery" rather than the start of a double-dip recession.

"Why is it taking so long for us to have our economic recovery?" Rust asked aloud before proceeding to suggest a flurry of reasons. Among them:
• Credit conditions are tight.
• The traditional relationship between companies posting higher profits and then adding jobs appears to be gone.
• Consumers are more frugal and, even if they wanted, can no longer tap their home equity to spend like they used to.

"It's the paradox of thrift," Rust said. Tight-fisted consumers "improve their personal household standing, but it ends up hurting the economy with less consumption."

"We knew the recovery process was going to be extremely drawn out," said Mark Vitner, who tracks Florida as a senior economist with Wells Fargo. "The economy looked as though it was improving more than it actually was because of all the stimulus spending and a boost from inventory rebuilding. Now that those two factors are slowing, we're seeing what appears to be a broad-based slowdown in the economy."

Economists with the Florida Economic Estimating Conference predict the jobless rate will top out at 11.8 percent in the third and fourth quarter before beginning a very gradual retreat. The conference doesn't expect unemployment to get back into the single digits until 2012 and sees it eventually falling to a healthier range of 6 percent by the fiscal year 2017-18.

See the full story, "Florida's unemployment rate ticks up to 11.5 percent"  by Jeff Harrington at the St. Pete Times website.
http://www.tampabay.com/news/business/workinglife/floridas-unemployment-rate-ticks-up-to-115-percent/1116434

Looking to relocate? NE FL has qualified people, but what about incentives?

In April 2010, the talk that Harley Davidson might move its plant from its 100 year old home in Milwaukee to reduce costs and make it more competitive with foreign rivals. Though such talk might be the result of union negotiations, Jacksonville’s manufacturing and labor advocates say the city would be a viable place if Harley Davidson relocated its 1,700 jobs locally.

Worksource Vice President Candace Moody says that their database is the largest repository of jobs and job-seekers in the region, and that her agency could easily produce a number of qualified people with skills that either apply directly to what the manufacturer needs or can be transferred after training.

But Jacksonville faces competitive barriers just because it’s in Florida, says Lad Daniels, president of the First Coast Manufacturers Association. Florida is surrounded by states that are more aggressive when it comes to wooing large employers.

“I’d say among Florida cities, we are the pick of the litter. The Southeast is pretty competitive, and Jacksonville is about as far south as they would want to look. But our incentives at the state and local levels are not what they get in other states,”

John Haley, senior vice president for business development for Cornerstone. He noted that Florida’s incentives to bring industry here center on jobs directly created. Additionally, some of those incentives run out of time more quickly than corporations can make decisions, so they miss out on some of them. He said other states have sweetened the pot better with longer-term, more capital-oriented incentives that amount to investments in the economic vitality of their communities.

“Our incentive process needs to recognize the value of capital investment.”

For example, Alabama weathered criticism in 1993 when it successfully proffered $300,000 in incentives per job to persuade Mercedes-Benz to put its $300 million Mercedes-Benz U.S. International Inc. SUV factory in Tuscaloosa County, Haley noted.

“That built an infrastructure that was conducive to heavy manufacturing like this,” he said. And since then, Hyundai and Honda also have built plants in the state.

Florida is also known for unwieldy and lengthy permit approval processes, something other states have stripped down, Haley said. For that reason, Jacksonville needs to better emphasize its industrial developments that are pre-permitted, he said.

Check out the full story "Jacksonville labor base ready for large manufacturers, officials say: City also has barriers, like smaller incentives."
http://jacksonville.com/business/2010-08-17/story/jacksonville-labor-base-ready-large-manufacturers-officials-say

3 to 5 Years Before Unemployment Rate Normalizes

Below is an excerpt from Karen Brune Mathis' story covering a presentation made by IBM's Chief Economist at JCCI on 8-18-2010. Check out the full article at Jacksonville's Financial News and Daily Record http://www.jaxdailyrecord.com/showstory.php?Story_id=531709

IBM Corp.’s chief economist predicts it will be 2013 to 2015 before unemployment, now around 10 percent, falls by half to what’s considered a healthy rate.

“My guess is it would be three to five years before we see unemployment getting back to 5 percent,” said Philip Swan, who has been with IBM for 36 years.

Job creation is the key to economic recovery, he said, because it influences consumer confidence.

That confidence has eroded since the recession began in December 2007 and has yet to be declared officially over.

In December 2007, unemployment was 5 percent and underemployment was 4 percent, totaling 9 percent.

Underemployment is the situation in which workers might be working part-time or less and want full-time or other more secure hours.

Now, national unemployment is 9.5 percent and underemployment is 7 percent, which totals 16.5 percent.

“We have never seen anything that dire,” he said.

Looking at the numbers of people affected, Swan said there are 7.4 million people unemployed and 5.6 million underemployed, leading to 13 million people who want secure employment.

Swan said the economy needed to generate 120,000 jobs a month merely to absorb new people entering the labor force. To start whittling down the unemployment rate, that growth needs to be 250,000 jobs monthly, he said.

Swan thinks the economy could reach that pace in five to six months.

NE FL County Snapshots - Population, Unemployment, and Employment Sectors

BAKER COUNTY
2009 population estimate: 25,899. This represents a 21.9 percent increase from 1999.

The total civilian labor force in Baker County for June 2010 was 12,366, of which 10,985 were employed and 1,381 were unemployed. The unemployment rate was 11.2 percent.

The total number of employees located in Baker County in 3rd Quarter 2009 was 6,848. The largest major industry sector was Health Care and Social Assistance (with 26 percent of the employment), followed by Retail Trade (44-45) (with 14 percent), and Public Administration (with 13 percent).

CLAY COUNTY
2009 population estimate: 185,208. This represents a 36.1 percent increase from 1999.

The total civilian labor force in Clay County for June 2010 was 96,322, of which 86,417 were employed and 9,905 were unemployed. The unemployment rate was 10.3 percent.

The total number of employees located in Clay County in 3rd Quarter 2009 was 42,036. The largest major industry sector was Retail Trade (44-45) (with 20 percent of the employment), followed by Health Care and Social Assistance (with 15 percent), and Accommodation and Food Services (with 13 percent).

DUVAL COUNTY
2009 population estimate: 900,518. This represents a 17.7 percent increase from 1999.

The total civilian labor force in Duval County for June 2010 was 451,519, of which 398,649 were employed and 52,870 were unemployed. The unemployment rate was 11.7 percent.

The total number of employees located in Duval County in 3rd Quarter 2009 was 428,693. The largest major industry sector was Health Care and Social Assistance (with 14 percent of the employment), followed by Retail Trade (44-45) (with 12 percent), and Finance and Insurance (with 10 percent).

FLAGLER COUNTY
2009 population estimate: 94,901. This represents a 102.5 percent increase from 1999.

The total civilian labor force in Flagler County for June 2010 was 32,713, of which 27,661 were employed and 5,052 were unemployed. The unemployment rate was 15.4 percent.

The total number of employees located in Flagler County in 3rd Quarter 2009 was 17,403. The largest major industry sector was Retail Trade (44-45) (with 18 percent of the employment), followed by Health Care and Social Assistance (with 11 percent), and Accommodation and Food Services (with 11 percent).

NASSAU COUNTY
2009 population estimate: 72,567. This represents a 31.0 percent increase from 1999.

The total civilian labor force in Nassau County for June 2010 was 36,575, of which 32,641 were employed and 3,934 were unemployed. The unemployment rate was 10.8 percent.

The total number of employees located in Nassau County in 3rd Quarter 2009 was 17,268. The largest major industry sector was Accommodation and Food Services (with 21 percent of the employment), followed by Retail Trade (44-45) (with 16 percent), and Health Care and Social Assistance (with 8 percent).

PUTNAM COUNTY
2009 population estimate: 74,608. This represents a 6.7 percent increase from 1999.

The total civilian labor force in Putnam County for June 2010 was 31,956, of which 27,667 were employed and 4,289 were unemployed. The unemployment rate was 13.4 percent.

The total number of employees located in Putnam County in 3rd Quarter 2009 was 17,157. The largest major industry sector was Retail Trade (44-45) (with 15 percent of the employment), followed by Health Care and Social Assistance (with 13 percent), and Manufacturing (31-33) (with 13 percent).

ST. JOHNS COUNTY
2009 population estimate: 183,500. This represents a 57.2 percent increase from 1999.

The total civilian labor force in St. Johns County for June 2010 was 96,311, of which 87,045 were employed and 9,266 were unemployed. The unemployment rate was 9.6 percent.

The total number of employees located in St. Johns County in 3rd Quarter 2009 was 52,677. The largest major industry sector was Accommodation and Food Services (with 17 percent of the employment), followed by Retail Trade (44-45) (with 14 percent), and Health Care and Social Assistance (with 12 percent).

Three Jobs For Every Unemployed Person in Jacksonville?

Below is an excerpt from Tom Patton's post at the Jacksovnille Observer. Check out the full article at http://bit.ly/threejobs

Three jobs per unemployed person. That’s an impressive statistic, isn’t it?

The online job aggregator Indeed.com has determined that, based on the job listings for Jacksonville, there are three job postings available for every unemployed person in the city.

That’s the second highest in the nation.

So, you might ask, why are we not at full employment? Why is anyone out of a job? Why aren’t employers clamoring for employees, paying way over market value for any warm body to fill positions?

The question becomes, are they real jobs?

If there were truly three actual jobs for every job seeker in Jacksonville, the Worksource meetings wouldn’t be full to overflowing. It’s easy to go online and post a job to an service. But if you eliminate all the duplications, the franchise or multi-level marketing “opportunities”, and the ridiculous things like “Plasma Donor”, you might have much better picture of the actual opportunities that are available. For those, applicants might need a high level of specialized education for things like RN, LPN or other medical fields, or some very specific experience.

If, with all that, there are three postings for every job seeker in this market, what must the true employment picture be like in a place like Detroit, where there is one posting listed for every 18 people looking for work?

Low unemployment in the nation’s new boomtowns

Throughout the good times and, more important, the bad of this new millennium, the cities of the plains—from Dallas in the south through Omaha, Des Moines, and north to Fargo—have enjoyed strong job growth and in-migration from the rest of the country. North Dakota boasts the nation’s lowest unemployment rate—3.6 percent, compared with the national average of 9.7—with South Dakota and Nebraska right behind it.

The trend has been particularly strong in urban areas. Based on employment growth over the last decade, the North Dakota cities of Bismarck and Fargo rank in the top 10 of nearly 400 metropolitan areas, according to data analyzed by economist Michael Shires for Forbes and NewGeography.com. Much of that growth has come in high-wage jobs. In Bismarck, the number of high-paying energy jobs has increased by 23 percent since 2003, while jobs in professional and business services have shot up 40 percent.

The primary drivers of this new growth are basic industries like agriculture and energy, according to Debora Dragseth, an associate professor of business at Dickinson State University. Salaries may be low by coastal standards, but so are living costs. And the prices of commodities like beef, soybeans, and grains have generally continued to rise, due in large part to growing demand from China, India, and other developing countries.

But the biggest play by far is in energy, including coal, natural gas, and oil, which exist in prodigious quantities from Texas to the Canadian border. Besides the vast reserves of oil that have made it the country’s fourth-largest producer, North Dakota possesses significant deposits of natural gas and coal, as well as huge potential for wind power and biofuels. These industries are drawing hundreds of skilled workers from places like California and Michigan, who are moving into Bismarck, the state’s capital, and towns to the west.

Nowhere is this potential clearer than in Fargo, which is emerging as a high-tech hub. Doug Burgum, from nearby Arthur, N.D., founded Great Plains Software in the mid-1980s. Burgum says he saw potential in the engineering grads pumped out by North Dakota State University, many of whom worked in Fargo’s large and expanding specialty-farm-equipment industry. “My business strategy is to be close to the source of supply,” says Burgum. “North Dakota gave us access to the raw material of college students.”

Microsoft bought Great Plains for a reported $1.1 billion in 2001, establishing Fargo as the headquarters for its business-systems division, which now employs more than 1,000 workers. The tech boom started by Burgum has spawned both startups and spin-offs in everything from information technology to biomedicine. Science and engineering employment statewide has grown by 31 percent since 2002, the highest rate of any state.

These jobs, and the people they attract, shower cash on the community's local businesses such as the busy bars and dining establishments in Fargo's Broadway Commercial District.

The full article, “The Great Plains: How Heartland Cities Like Fargo and Omaha Became the Nation’s New Boomtowns” by Joel Kotkin, appeared in Newsweek Magazine on August 12, 2010 (page 50).