Posted on December 02, 2011 10:00 AM
Metropolis Strategies report proposes solutions for troublesome regional economic trends
GO TO 2040 seeks to maintain and strengthen metropolitan Chicago's position among the nation’s few global economic centers. Global connections are increasingly important, and being linked to international trade and information networks provides our region with new economic opportunities and a broader range of jobs, and makes us an attractive place for both workers and businesses. Strategies targeting clusters of regional specialization can help address the fragmentation and unfocused investment that sometimes undermines the emergence of new marketable products and technologies. Better systems for collecting, tracking, and analyzing important measures should also be pursued, according to our region's comprehensive plan.
In November 2011, the regional civic organization Metropolis Strategies issued a report titled "Restoring Chicago's Momentum: A Regional Agenda for Economic Growth." After first making a case for the importance of metropolitan areas to state and national economies, Metropolis Strategies sounds an alarm that our region's competitive advantage is at risk due to a lack of cohesion across the private and public sectors. It points out the inefficiency of approaching economic development primarily as a matter of luring businesses from other regions or from one local community to another, as opposed to supporting existing strengths and fostering innovation to grow the economy of metropolitan Chicago.
The report describes strategies for the "new economy," including targeted investments aimed at achieving specific, measurable outcomes, which is among the top priorities of GO TO 2040. The group's analysis seeks primarily to convince leaders in the public and private sectors that, by acting together in support of regional objectives, they can secure metropolitan Chicago's place in a dynamic new worldwide economy that tends to be unforgiving when regions fail to meet the requirements of global commerce. For too long, our region has taken an unfocused approach. "Addressing the 'parts' in isolation does not work," Metropolis Strategies says. "It is about business, labor, capital, innovation, infrastructure, taxes, and regulations -- and how they work together."
Metropolis Strategies recommends four key strategies:
1. Take action around a regional economic agenda defined in a Metropolitan Business Plan.
2. Build on the region’s assets, starting with strong business clusters.
3. Measure economic performance and base policy actions on evidence.
4. Make smarter investments of public and private dollars to stimulate growth.
The report states that public and private investments have been made "without objective information about assets and economic performance." It calls for creation of an economic institute responsible for providing reliable information to help decision makers understand the regional economy, citing as an example the Bay Area Council Economic Institute in San Francisco.
Among the bright spots cited, venture capital funding increased more than 200 percent from 2009 to 2010, partiallythe result of effort put into incubating businesses, mentoring entrepreneurs, and promoting effective business plans. These investments, which have emphasized innovation in general and information technology in particular, demonstrate the potential of concerted regional action by the private and public sectors. But Metropolis Strategies describes the limitations of a "piecemeal" approach in which uncoordinated -- or worse, competing -- organizations pursue common objectives without accurately assessing their challenges, opportunities, and outcomes. The report presents evidence that our region has been losing momentum in recent decades, as shown in the chart below.
Metropolis Strategies highlights the value of an "industry cluster" based approach to identifying and building on regional strengths such as the movement of goods, pointing out metropolitan Chicago's importance as the leading U.S. freight hub. Freight is also an example of the need for close collaboration between the public and private sectors, as has been the case with CREATE and as needs to become more common in support of other regional clusters. The report describes a metropolitan business planning process that takes a long-term view by aligning infrastructure investments, workforce development, and governance issues and by convening firms to set the cluster's agenda and help create a climate of innovation.
The report also asserts that resources currently spent on marketing to lure business relocations would be better spent on helping existing businesses to compete more effectively -- for example, by ensuring the availability of a skilled workforce -- and by fostering the creation of new, homegrown businesses. The following chart shows the importance and potential of these approaches.
Another key is the coordination of government services -- e.g., workforce development -- and investments to support existing areas of strength. According to the report,
A thriving regional economy will deliver excellent public services, transportation, education, abundant opportunities, and a high quality of life. Promoting successful regional economic development requires a deliberate and well-conceived agenda that is driven by data, fashioned and supported by the entire region, and led by the private sector working in collaboration with government.
Addressing these varied but interdependent challenges with an integrated approach, the report says, "requires a deliberate, long-term regional action agenda to ensure that Chicago will remain resilient and competitive for future generations." Metropolis Strategies (formerly Chicago Metropolis 2020) was among the driving forces behind the creation of CMAP.