Posted on April 17, 2012 1:41 PM
Illinois Innovation Index Finds Exports Driving Economic Growth
The April edition of the Illinois Innovation Index draws attention to the role of exports in economic growth. The continued development of international markets -- especially burgeoning economies like China and Brazil -- is fueling the demand for more goods. Firms that export are better positioned to gain access to these rapidly developing markets and grow. As the Index shows, exports generated almost half of all growth in the U.S. economy between 2010 and 2011, composing its largest share of U.S. GDP in over 70 years.
A major finding of the Index is that metropolitan areas are particularly important for exports, contributing almost 85 percent of all U.S. export sales in 2010. The Chicago MSA (including parts of southeastern Wisconsin and northwest Indiana in addition to northeastern Illinois) exported goods worth $53.9 billion in 2010, supporting over 375,000 jobs in the tri-state region. Both in the value of exports and the number of exporting jobs, the Chicago region ranked only behind New York and Los Angeles as the largest exporting center in the country. The role of exports in our regional economy is increasing -- from 2009 to 2010, the Chicago region’s export growth rate grew more quickly than that of Los Angeles or New York.
The data examined in the Index shows that not only do exports support a large number of jobs, but the jobs they support pay on average 11 percent more than those at non-exporting companies. The role of exports in creating good jobs and spurring growth has not gone unnoticed. For example, two years ago the White House set a national target of doubling exports by 2015. On April 3, the first meeting of the Illinois Export Advisory Council, which seeks to increase exports in the state, was held. Metropolitan regions are also orienting their economic growth strategies around exports. In 2011, the Brookings Institution’s Metropolitan Export Initiative partnered with Los Angeles, Minneapolis/St Paul, Portland (OR), and Syracuse to develop export plans for each region.
As the role of exports in spurring economic growth is thought to only increase with the continued development of international markets, it is imperative that the Chicago region maintains its position as a leading export center. GO TO 2040 provides a blueprint on how to build on the region’s strengths to better compete in the international marketplace. The plan recommends that the region support its industry clusters, including freight and manufacturing. Both freight and manufacturing are vital components of a successful exporting base. GO TO 2040 also recommends that the region take a more active role in supporting economic innovation. Developing new products and efficiencies will make regional exports more attractive on an international stage. Finally, GO TO 2040 presents a series of strategies to improve workforce services. As the economy rebounds and technology changes, many workers will need to learn new skills to match new jobs. Making workforce services more flexible in response to changing international dynamics will help ensure the region has a workforce skilled in exports.
The data from this month’s Index is available on MetroPulse.