Transcript Document

Setting the Stage
Brian Bosworth
Presentation to The Ford Foundation
Regionalism and Sustainable Development Fellowship
Memphis TN
February 7, 2007
Two Objectives
1. Review some of the big global trends that are
driving changes in the regional agenda,
making regions more important, and raising
the bar for Chambers of Commerce.
2. Discuss the logic framework of this
Fellowship… our “theory of change.”
The U.S. and the Global Economy
(stuff you already know)
1. We live in a “flat world” causing rapid shifts in
competitive advantage of nations.
2. Technology change has been a constant but never
at this velocity and with this transforming
quality.
The U.S. and the Global Economy
(continued)
3. A global talent explosion led by such nations
as Brazil, Russia, India, and China.
4. Facing a “perfect storm” in U.S. science,
engineering, technology
 Retirements; declining high school math
and science; flagging interests of young
Americans; under-represented minorities;
decline in talent emigration to U.S.
The U.S. and the Global Economy
(continued)
5. We face intense competition for and conflict
over energy resources
 U.S. has huge fuel dependencies with very
little R&D into new solutions
 Already a source of global conflict
6. We have global savings-debt crisis in a radically
imbalanced global economy
 Personal savings in U.S. lowest in 70 years
 U.S. seeking well over $2 billion per day of
foreign capital to balance trade deficit
Of Course, A Lot of Assets
Very highly functioning system of democratic capitalism.
A national economy more than three times larger than any
other nation.
An extraordinarily creative, entrepreneurial population
But Some Troubling
Demographic Trends
Huge Demographic Changes in the U.S.
(stuff you might not know)
1. From 1960 to 2000, U.S. labor force doubled
(from 70 million to 141 million).
2. Number of prime age workers (25-54) increased
over 130%.
3. Percentage of adults with high school degree
doubled (from 41% to 80.4%).
4. Percentage of adults with B.A. or higher tripled
(from 7.7% to 24.4%).
Demographic Changes in the U.S.
(continued)
Several studies conclude that this rise in
education attainment has been a major driver of
U.S. economic growth.
From 25 to 40% of average annual growth in
output since mid-1900s can be attributed to
increases in education attainment.
Demographic Changes in the U.S.
(continued)
But, this era of labor force growth has come to an end.
BLS projects total growth from 2000 to 2040 of only 29%
(compared to 102%).
Number of prime age workers will increase only 16%
(compared to 130%).
Labor force participation will decrease.
Demographic Changes in the U.S.
(continued)
That’s only half the story.
Education attainment won’t increase; it’s likely to
decline.
Older workers as educated or more than new ones
coming in.
Attainment slowdown already underway:
• High school graduation rate is declining;
• College entrance rate is flat: and,
• College completion rate is declining
Demographic Changes in the U.S.
(continued)
Big changes in racial/ethnic composition of
younger age cohorts -- much larger percentage of
those not well served by education systems.
2000 census showed Whites twice as likely as
African-Americans and three times as likely as
Hispanics to earn a B.A
Demographic Changes in the U.S.
(continued)
Two big wild cards:
• Immigration -- Now, it is accelerating the trend to
low attainment. Doubtful that this will change.
• Prolonged labor force participation of older workers -
- The percentage of age 65+ who still work is on the
slow increase. But, it’s not likely to increase further at
the magnitude necessary to change these big numbers.
So, What Does This Mean?
As labor force and educational attainment grow slowly or
not at all, overall economic growth will slow.
But differences among regions will become even more
important; some will slow more than others; some will
buck the trend and grow.
Even over the past 40 years, while national economic
growth helped all regions, some regions did much better
than others.
Regional Differences
Regions with above average numbers of college
graduates have experienced faster growth and higher per
capita incomes.
• From 1980 to 1998, the 10 regions with the most college
graduates had per-capita income growth of 1.8%annually.
Regions with fewer than average numbers of college
graduates experience lower per capita incomes and
slower growth.
• From 1998 to 2000, the 10 regions with the fewest college
graduates saw an annual income growth of 0.8%.
Widening Regional Gaps
In 1980, average per-capita income in the most-educated
regions was 12% above the U.S. average and in the leasteducated regions 3 % below the national average.
By 1998, most-educated regions had average incomes 20%
above the national average, while average incomes in the
least-educated regions had fallen to 12% below the national
average.
The most-educated regions enjoyed productivity growth of
0.5% per year, compared with growth of 0.1% for the leasteducated ones.
Source: Gottlieb and Fogerty Educational Attainment and Metropolitan Growth (2003)
In Future, Some Regions Will Do Better
Than Others
Especially, those that do a better job at educating their
less advantaged young people, and then retaining them.
Those that do a better job at educating their adult
workers and then retaining them.
Those that do a better job at attracting well-educated
people from other regions, and then retaining them.
Regions Do Well When…
They have globally-oriented businesses good at applying
and converting technology into innovative products and
services.
They have R&D institutions good at spinning out
technological adaptations of science and engineering
innovations.
Their businesses and R&D institutions can attract and
retain talented and creative people.
They have strong and flexible institutions for education
and skill development.
Everyone contributes. Everyone can be moved, housed,
and schooled.
Leads to New Economic Development
Paradigm
Innovation
Learning
Place-making
Reducing Disparities
Innovation
Focus on traded sectors -- e.g., biotechnology,
advanced manufacturing and information
technology.
Nurture and support emerging & established
industry clusters.
Foster university-industry partnerships.
• For R&D if you have it, for rapid and widespread
technology application if you don’t.
Learning
Provide rich and continuous supply of human
capital (education, skills, flexibility, creativity,
and drive)
Requires strong K-12, robust 2-year college
system and world-class universities
Sophisticated and well-coordinated public
workforce development system
Place-making and Distinctive Identity
What’s important in a time of high
mobility?
•
•
•
•
•
•
•
Transportation
Culture and Recreation
Public Education
Housing Choices
Vibrant Center City
Authentic Neighborhoods
Tolerance and Diversity
Reducing Economic and Social Disparities
Shift from charity to investment
Recognition that growing socioeconomic disparity is bad for
business
Utilizing market mechanisms to
create opportunity
The Ford Foundation
Regionalism and Sustainable
Development Fellowship
Our Theory of Change
Our Theory of Change: 1
Regions are the primary geographic building block
for global economic competitiveness.
The region is the operating landscape for traded sector
businesses.
It takes a region to achieve the economies of scale,
scope, and opportunity necessary for the diversity of
people and specialized businesses that are essential to
succeed in tough global competition.
Workforce, transportation, housing, education, supplier
networks -- all exist on a regional scale
Our Theory of Change: 2
Businesses gain or lose competitive advantage based
on the health of the region.
Businesses competing in a global economy gain competitive
advantage from a healthy regional economy that on a longterm, sustainable basis
• Produces and attracts educated, skilled, and creative people;
• Fosters innovation and accelerates its rapid diffusion
through the region;
• Moves people and goods quickly and efficiently;
• Makes smart use of environment and natural resources;
• Offers affordable housing, near jobs; and,
• Works to reduce disparities of income and opportunities.
But businesses and their performance are hurt if they
are based in an unhealthy region where poor public
policy and private sector neglect combine with shortsighted vision to create:
high levels of concentrated poverty,
 traffic congestion and commuting delays,
 jobs-housing mismatch and affordability barriers,
 urban-suburban disparities,
 inner-city decline, and
 limited access to good jobs for low-income people.

Businesses cannot recruit locally or attract nationally or
internationally (much less retain) the technical skills and
business savvy they need for competitive success.
See readings by Manuel Pastor
Our Theory of Change: 3
The business sector must lead the region in pursuit
of sustainable development.
• Business has the most at stake.
• Business can lead at the regional scale, where civil
jurisdictions lack effective mechanisms and too frequently
compete rather than collaborate in economic
development.
• The business sector has the capacity to mobilize
resources, the expertise to organize and implement
complex undertaking, and the continuity of presence that
extends beyond the term of elected public officials.
Our Theory of Change: 4
Individual business action is just too daunting and
usually ineffective
• No single business can effect wholesale regional change,
• Challenges just too big, too deeply embedded.
• Most business leaders just don’t have the time.
• Few business leaders have the skills.
• Lean management has reduced corporate hierarchy.
• Newer, more entrepreneurial business leaders not
comfortable with the slower pace of civic decisionmaking.
• Other groups in the region sometimes view business
leaders with suspicion.
Our Theory of Change: 5
Collective action through general purpose
business associations is essential.
• Because immediate costs of engaging in regional
agenda are high for individual firms, it’s up to businessbased, mediating institutions to mobilize collective
business action.
In fact, in a knowledge-based, global
economy, it’s now the central challenge of
business-based, civic institutions (Chambers
of Commerce) to help their member
businesses:
1.
2.
3.
find and pursue opportunities for collective
action in pursuit of sustainable regional
growth;
create long-term partnerships; and,
use their combined economic power and
influence to promote business practices and
public policies that build efficient and inclusive
metropolitan regions.
Our Theory of Change: 6
Chambers of Commerce will develop and expand
their capacity for regional leadership.
• The skills and tools to support the mission of modern
regional business organizations are quite different from
those required for traditional civic boosterism.
• strategic analysis
• coalition building and agenda setting
• product development, implementation, and evaluation
• Chamber execs still need highly developed process
skills, but now also need deep content knowledge.
Our Theory of Change: 7
This Fellowship can build knowledge and the
capacity for action.
• Participation will include chamber from 32 major
metropolitan regions who will:
• learn from national experts and from each other.
• develop a Regional Action Plan with peer support.
• engage regional business leaders in supporting that
Plan.
• “spread the word” and help build the capacity of other
chamber executives in North America.
Sustainable Development: Defined
Economic development that can be sustained over time
because it is not environmentally or economically selflimiting.
It is a growth strategy: It aims to build per capita income
and wealth within the region while explicitly creating
wider opportunity for all residents to contribute to and
participate in the benefits of economic growth.
It advances regional patterns of growth that meet
environmental quality attainment standards, combating
fragmented, inefficient land use planning and wasteful
development patterns that can concentrate poverty and
increase business and taxpayer costs.
Some of the Questions
What does this mean for your Chamber’s…
• Geographic scope -- what’s the region?)
• Relationship with other business organizations?
• Mission, objectives, services, and performance
metrics?
• Organization, membership, and revenues?
Who are your partners (who is not) and what is
your relationship to local and state governments?
What are the most important issues and how do
you establish priorities?
Our Style?
Challenging, iconoclastic, curious, nonideological, and with high mutual expectations.
Friendly, supportive, respectful.
Informal, serious in intent (if not always in
demeanor).