February 24, 2015 – Brookings, By Amy Liu and Owen Washburn
Metropolitan leaders across the country share a desire to create high quality jobs, get more young adults and other workers into those jobs, expand incomes, reduce inequality, and keep their core industries competitive in the face of rising global competition and opportunity. Yet traditional tools of economic development are ill suited to achieve these aspirations and create inclusive, prosperous communities.
Economic development calls to mind longstanding practices of building housing, retail centers, and far-flung industrial parks—or attracting business relocations—to boost municipal tax revenue. These approaches are often costly, zero-sum, and do little to address yawning social gaps in metro areas. Furthermore, they don’t satisfy the demands of the modern economy, which requires concerted efforts to help firms, workers, and communities adapt effectively to new technologies and global competition.
Now however, cities and metro areas are moving away from these traditional economic development strategies to a new model of economic growth that can lead to long-term prosperity. This model focuses on enhancing existing market assets and capabilities to boost trade, increase the value of advanced industries, and create incomes and opportunities for workers, no matter where they live in the region. While landing a big brand name firm (invariably with sizeable public incentives) still grabs headlines, we are seeing more attention paid to business formation, talent creation, and the role of placemaking and infrastructure in both.
With this new model comes a broader cadre of leaders that reflect the evolution underway in economic development. The task of fostering quality jobs, incomes, and opportunities falls beyond the work of municipal economic development staff, chambers of commerce, and business attraction and retention agencies. Hence, we have witnessed an explosion in the number and range of players in regions—from elected officials to employers, business groups, universities, community colleges, entrepreneurs, and nonprofit executives—who are working in partnership to tackle the challenge.
This shift to a new model of economic development is hard work. The strategies and progress are often invisible and do not lend themselves to easy metrics of success like firms or jobs “created” through recruitment. New ideas, data, and evidence to inform or substantiate path-breaking efforts can be tough to find. And innovative regions need reinforcement, so that well-intentioned collective impact strategies forged in the wake of the recession do not give way to a return to old habits.
As part of that reinforcement, we’re introducing the Metropolitan Innovations blog series (this is the first entry) and a newsletter (sign up here) to give these leaders the resources to deliver quality economic development. The country is replete with promising efforts, some of which we are already closely tracking through our own work with city and regional leaders as part of the Brookings-Rockefeller Project on State and Metropolitan Innovation, and the Global Cities Initiative, a joint project of Brookings and JPMorgan Chase. In our series you’ll find stories of innovations, lessons from what’s worked (or not), and new data and research to guide problem-solving. Our recent writings on Seattle’s smart building cluster and credential program, lessons from Germany on skills and apprenticeships, or how incentives can be redesigned to minimize their negative economic impacts, give a sense of the activities and developments we will be watching in this space.
In the coming months, we will also explore more evidence and factors behind the new model of economic development emerging in the country. We hope you join us in this evolution.
The information above is for general awareness only and does not necessarily reflect the views of the Office of Economic Adjustment or the Department of Defense as a whole.