This article is part of a series sharing highlights from the 12th convening of the Project on Municipal Innovation – Advisory Group at Harvard Kennedy School in September 2014. This installment focuses on the session titled "Growing New Sectors, while Ensuring Inclusionary Job Creation."
As America’s largest cities emerge from years of recession, the challenge for city leaders is to ensure that cities not only do well, but that they do well for all: for residents of all races, ages, economic levels and skill sets; for residents who are recent transplants, and those whose families have lived in cities for generations.
At the PMI-AG convening this fall, more than 30 municipal leaders from across the U.S. met to discuss strategies to enhance local economic development through equitable growth across sectors and skill sets. Their collective insights and suggestions for other municipal leaders are summarized below.
Think small. Leaders noted that, when developing economic growth strategies, thinking regionally or even citywide is often too broad an approach. Instead, focus on specific industries and neighborhoods. For example, Portland, Ore., is using a cluster strategy to focus its business development efforts. The city is leveraging its existing industry strengths in clean tech and advanced manufacturing rather than trying to attract new firms to the area.
Then go global. Most of the world’s consumers, as well as its projected economic growth, are outside of the United States. In Portland, city leaders have engaged in trade missions abroad to help local businesses connect with the global market. Their efforts are paying off: so far, the city has signed trade agreements to provide green development services to cities in China and Japan.
Make room for “blue-collar innovation.” Are there industrially-zoned areas that can be converted to “blue-collar innovation” spaces? In many large American cities, it is easier and cheaper for a young app developer to find innovation space (a desk and a coffee maker) than an apartment. Yet for the blue-collar innovator seeking to open, for example, an artisanal motorcycle repair shop, the cost of innovation space can be prohibitively high.
Leaders can put America’s biggest cities on the path to achieving not just growth, but inclusionary growth that will improve the lives of all residents.
Attract and retain young job creators. Once a city has identified its competitive advantage, it must take steps to preserve and strengthen it. For Boston, this advantage is the high number of bright young students who attend the many colleges and universities in the city. Boston has been successful in encouraging these young people to start companies in the city, but too many of them are moving away to cities like San Francisco and New York that are viewed as “cooler” cultural hubs. In response, Boston has taken steps to make the city more attractive to young people. The city has developed a waterfront Innovation District that hosts events, art installations, and startup incubators, and the mayor’s office has successfully worked to keep bars open later.
But also recognize the potential of older entrepreneurs. “Entrepreneur” may call to mind a millennial in skinny jeans working on his MacBook in a café, but other groups – blue collar workers, middle-aged moms – may have equally rich reserves of creativity and business savvy. Rather than seek to build an entire local economy on technology and high wage export sectors alone, cities should support a wide array of small businesses. In particular, the business-to-business sector – including small-scale catering, maintenance and logistics companies – has potential to create large numbers of middle-wage jobs for workers who lack college diplomas.
Avoid reproducing old inequalities in new sectors. Cities should consider targeted efforts to support entrepreneurship among women and people of color. To ensure that all groups have an opportunity to gain the skills they need to put their ideas into action, cities must take steps to ensure social and physical connectivity across neighborhoods.
Help lower-skilled workers share in their city’s economic success. Job creation only benefits longtime city residents if they have the skills to get hired. New Orleans is booming now, but this growth could easily bypass the residents who struggled in poverty both before and after Hurricane Katrina. To help these residents, the city has piloted the Livable Claiborne Communities project in a specific high-poverty neighborhood. The program entered into a partnership with a local hospital that had struggled to retain employees. To date, residents are benefitting from jobs, and the hospital is recording dramatically lower turnover among employees hired through the program.
Remember that municipal “support” is more than money. Several of the leaders present noted that their cities’ capital investment in developing new sectors was lower than others might expect. Rather, participants stressed the power of the mayor’s “bully pulpit” to attract investment and promote entrepreneurship. Cities can also provide direct assistance to early-stage companies by helping with market research, real estate selection, talent attraction, and export strategy. Finally, cities can ensure that their own public sector procurement processes benefit local businesses wherever feasible.
By adopting these strategies, leaders can put America’s biggest cities on the path to achieving not just growth, but inclusionary growth that will improve the lives of all residents.