Software, digital hardware, and the life-science industries are capable of adding jobs indirectly to a local economy as multipliers, in much the same way as the manufacture of autos and appliances, contributed decades earlier with one significant difference. The education of the workers.
Research and development firms in physical, engineering, and life sciences were the first to take full advantage of the technological revolution in information management. These industries deposited economic growth into regions with innovations in software and hardware. Perhaps the best-known example of this marriage of technology and science is our understanding DNA would have been impossible otherwise, leading to exponential growth in these industries into exclusive new fields.
Economists have several explanations, but two words get to the multiplier effect for business and jobs – supply chain. The 2020 pandemic revealed specific concerns regarding breaks in this chain, reflecting national security concerns. The logistics of technology for refining acquisitions of material into “just in time” cash saving packets fail miserably during periods when critical conditions demand everything “all at once” to avert a crisis. Both global terrorism and climate change hint at this issue like an hour hand, but it was the second hand that swept the planet with a new reality regarding readiness. Frightening concerns as these are, recommitting Amerian policy to jobs and education may be the only way for the economy to stop shaking.
UC Berkeley Economics professor Enrico Moretti’s The New Geography of Jobs examines places in the United States that illustrate the critical difference between economic growth and decline in the context of winner/loser locations in a rapidly globalizing economy. Using U.S. Census Bureau data, Moretti’s book exhibits maps of the United States to reveal the location impact of the system change. The growth areas were those with a high percentage of college-educated people. He shows a decline in the regions that still have many “smart people” to this day but failed to produce, keep, or attract educated people in the newly growing system change businesses.
Scholarly observers labeled “the losers” as shrinking cities, pointing to places such as Detroit, MI, and others of the Northeast “rust belt” following their analysis of 2000 and 2010 Census. Studies of similar “shrinking” conditions throughout Europe focused on this as a phenomenon of industrial globalization, regional deindustrialization, and suburbanization. In all cases, the winners were those who had in residence or could attract well-educated people. The analytical resources are available for the ordinary observer to dig into these changes as a dynamic force, as well as one, affected by public policy. In 2020, the importance of easy access to vital information and to re-establish confidence in the small business and banking community is more important than ever. As the history of the Bureau of the Census shows in its “understand America” mission, it has grown to become a major business subsidy for nationalizing businesses. The question for moving forward is how to make the richness of the Bureaus’ “jobs and education data” more widely available and easily accessible by the small business. Here is a quick look.
Geographic Support System Initiative (GSS-I)
For the 2020 Census, the Census Bureau’s reengineered address canvassing reduces costs. In December 2015, BOC published a 100-page report entitled, 2020 Census Detailed Operational Plan for the Address Canvassing Operation to describe this new Address Canvassing methodology. The practice has been routinely updated through 2018 (here) and eventually rolled into the GSS Program.
The maps (left) should be of interest to all Americans. Authorization constraints still hamper the advancement of this resource toward the routine use of a small business. The API from BOC has tutorials on how the data can help businesses. A tutorial of an analysis that links small businesses with congressional elections (here) is an excellent example.
The policy impact on regional economic growth or decline has a range from why Microsoft owners decided to move to Seattle to public attract business policies two decades later. Microsoft took their small, but rapidly growing 1970s company to Seattle because that is where they were from and felt comfortable. The decision by the fledgling Microsoft, however, is also like, but the reverse of public initiatives in regions hoping to find growth. Both are equivalent, as they are a roll of the dice, plus confidence. Federal officials would not learn of the explosive growth of the software and hardware technology industry until the early 1990s when a variety of attraction-bets came logically into policy.
I doubt that Bill Gates went to the Standard Industrial Classification (SIC) system for help in selecting Seattle as the optimal location. The SIC was developed in the late 1930s as a New Deal-era initiative by the Interdepartmental Committee on Industrial Classification. His business was barely on the list and would not be there solidly until the reinvention of the SIC in 1997 turned it into the North American Industry Classification System (NAICS). By that time, Microsoft had already put sad little Seattle on the wow-map, but it was not all by itself. It happened because of the enormous attractive power of the industry. Seattle was not a place with a high percentage of educated residents in the 1970s. Over the next twenty years, Microsoft attracted whole businesses, and they all attracted people with educations that met their needs.
The nerd factor here is essential in another way. The mayors of cities who called up there planning and economic development commissioners and said, “get me some of that!” So they put the staff that loved digging into the nooks and crannies of the NAICS to define their regions for comparison to all others economically. More mayoral questions on the decline and what to do tended to get answers such as publically invest in “cultural transformation” that led to the arts and a bet on the instinct of people not only to be creative but productive artisans as well.
A search engine for NAICS (here) now takes researchers into a six-digit code that parses twenty industry sectors: five goods-producing industries and fifteen services sectors all geographically searchable at Bureau of the Census (here). In looking at the economic structure of employment, the basics are:
- Jobs drive economic growth wherever they are located.
- Where you find around 50 percent of workers with college degrees, there is growth.
When the meaning of the word strategy is to get the advantage, the purpose of examining sector-based development is a good idea. When it comes to isolating specific industries by region, this is especially true. Shared needs mean common supplies and mutually beneficial investments in human capital. Public “attraction” strategies that attempt to connect a worker to an employer is an abstraction. It functions well in the short-term, but in the long, it is a malfunction sustaining the myth that low-end employment leads to a ladder that has rungs. They are there, but very far apart if the business-model is the provider, without public partners.
What works more effectively are efforts that alter the worker/employer relationship with massive investment in skills that add choices to the worker and their flexibility within a region. Flexibility has cards to be dealt into the public policy hand as well. The options range widely from help with a car, or specific procurement practice, to a fully paid training program, or support for a master’s degree. An added benefit of worker-centered investment, participants are capable of contributing to the advancement of policy decisions in the future of meaningful work.
Whether that work is by a forensic accountant or a cashier, the purpose of a system change is to build on challenges, opportunities, and futures of them both into eloquent experiences in personal development. One might seek to build a substantial business and growing consulting practice to one who just needs a living wage and happy kids. It should not matter which of them is doing that thinking. The idea of winners and losers will probably always be a macroeconomic point, but it should never exist as a community-based experience. What should happen in the heart of the cashier or the accountant is the opportunity for growth through a higher education resource is unquestionably and unequivocally available.
The national partnership between employment and education is a failure. In 2014 the Economic Opportunities Program of the Aspen Institute and the American Assembly (Columbia University) published Connecting People to Work: Workforce Intermediaries and Sector Strategies. It is a 500-page set of whitepapers. The paper to read in this book (pdf here) examined the February 2012 announcement of the Community College to Career Fund. An eight-billion-dollar investment was seeking to bring skills that lead directly to good jobs with the goal of two million workers. The program aimed at high-growth industries by funding regional or national industry groups tasked with identifying workforce needs in their respective fields and developing solutions like standardized worker certification, new training technologies, or collaborations with industry employers to define career pathways for workers.
When a 500-page document becomes available for the ordinary reader, parsing it for keywords is a powerful tool for skimming the material in search of specific content using one or two words. I discovered the essay on public investment in a community-college program this way. It was this one that brought out the economic “malfunctions” that affect connecting jobs and education to community development. The words below are ranked from most to least.
The word “sector” occurs 1,319 times and “national” 817 and “region 468 times. The word “federal” occurred 197 times but “federal government” just 14 times. Community College was 151, “university” 115 with cities at 86 and “suburb” only 5. I found “local government four times, and “regional government” just once. The use of the word “schools” – 20 with high schools getting only three mentions. The choices are many, “union” was interesting as was “interprofessional” and training.
Central to the idea of improving connections between job seekers and producers is the idea of fairness or balance. In a global economy where the imbalances are overpowering, local efforts can seem heroic. This is what is wrong with them. With this view, the use of the word “race” was a mere 36 times, that broke down to “African-American” 24 times and to Hispanics just 7 with the rest mixed in with the word “gender” 18 times. These are not hot-button words for the footnotes. The issues the people face with these labels must drive the conversation forward, not help it disappear.
Again, the brilliant, heroic work at the local level is not the issue. The megaregions of the nation hold over 85% of the nation’s GDP. Still, the usefulness of regional institutions beyond a structure of few mutual benefit corporations is nil. Malfunctions in jobs and education remain piled into a quagmire of State policy competition neatly encouraged by the scant of national policy.
In every developed nation in the world, children are considered the top national resource. In the United States, the policy appears to be the children of America are among the highest percentage of low-income whites amid towering imbalances involving people of color. Programs that look at popular fixes such as H1B visas and other short-term job filling policies fail to fully consider a thirty to fifty-year generational failure aimed at children from low- and moderate-income in America.
“The vitality of architecture does not stand on the strength of its foundations or the vision of its builders. It stands on the dignity of life formed in the heart of all of its creators.”Rex L. Curry (Review of video by Mike Yellen for Ironworker Union 2017) Watch below.
The video above will also be found in a “system change” post on planning, architecture, and engineering (here). It opens like this: “Your bones tell you, you smell it, there is the challenge of unclear change on the tongues of the public speakers. The sticky multiple versions of the truth offered in the political-speech of our modern lives will be swept away by the clear mind of science. This is a call for help in that simple pursuit.”
Below: a sample of data available from U.S. Census Interactive Maps as described above.