News from the IPL
ANNOUNCEMENTS
SBA Announces 20 Winners of the Growth Accelerator Fund Competition
SSTI Weekly Digest
The U.S. Small Business Administration (SBA) has announced the 20 recipients of the fourth Growth Accelerator Fund competition. The winners, which represent a broad set of industries and a diversified range of demographic groups, will each receive a cash prize of $50,000 to address gaps in regional entrepreneurial ecosystems as part of the award. Awardees will be required to submit quarterly reports for a year, and must report or provide their metrics, including jobs created, funds raised, startups launched and corporate sponsors obtained.
UK Government Announces a Digital ‘T-Level’ to Encourage Technical Skills
ComputerWeekly.com
The government has announced a T-level in digital will be among the first three technical qualifications the UK is introducing to increase technical education. Education secretary Justine Greening announced the first three T-levels to be introduced are construction, digital, and education and childcare. The idea of developing the new technical qualifications, dubbed T-levels, is to develop more UK talent to fill technical skills gaps in the wake of the UK’s decision to leave the European Union.
Editor's Pick
International Energy Agency
Digital technologies are everywhere, affecting the way we live, work, travel, and play. Digitalization is helping improve the safety, productivity, accessibility, and sustainability of energy systems around the world. But it is also raising new security and privacy risks, while disrupting markets, businesses, and workers. This report is the first comprehensive effort to depict how digitalization could transform the world’s energy systems. The report examines the impact of digital technologies on energy demand sectors, looks at how energy suppliers can use digital tools to improve operations, and explores the transformational potential of digitalization to help create a highly interconnected energy system. This report seeks to provide greater clarity to decision makers in government and industry on what digitalization means for energy, shining a light on its enormous potential and most pressing challenges. It also lays out no-regret recommendations to help steer the world towards a more secure, sustainable, and smarter energy future.
Innovation Policy
Strategies for International Success: Lessons from Six Canadian Firms
Paul Boothe and Alister Smith, Institute for Competitiveness and Prosperity
Success in international markets does not come easily. The business environment can be very different from the firms’ home markets and there may be a whole new set of competitors to confront. Firms that want to succeed in international markets need a winning strategy. As such, the authors looked at the strategies used by a select group of internationally successful Canadian firms in an effort to learn from their achievements. These firms either export goods or services to foreign markets or have established successful operations abroad. In some cases, they participate in global value chains. Each is a seasoned international competitor. They conducted structured interviews with senior decision-makers from six Canadian firms based in Ontario to learn more about their strategies.
OECD
The demand for skills in developed countries is changing constantly as a result of global trends such as technological progress, globalization and population ageing. In France, as in many other high-income countries, the composition of the economy has changed considerably in recent decades, shifting towards high service intensity. High tech manufacturing and knowledge intensive services account for an important share of French value added, signalling a strong demand for high-level skills. Nonetheless, while France performs well in terms of innovation, a substantial gap remains compared with other European countries in the vanguard. The educational attainment level of the French population is average compared with other OECD countries, and the proficiency of French adults in literacy and numeracy is below the OECD average, suggesting that the supply of skills may represent bottlenecks for the economic performance of France. In order to better match the demand and supply of skills, France has to invest in developing the right skills, especially in an era of fast-changing skills demand. A first step in tackling skills imbalances is a thorough understanding of the country’s skill needs. In France, multiple national, regional and sectoral skill needs assessment exercises have been put in place, using a variety of data sources and methodologies. The evidence from these exercises feeds into training, career guidance and migration policies.
Computers and the Future of Skill Demand
Stuart W. Elliot, OECD
Computer scientists are working on reproducing all human skills using artificial intelligence, machine learning and robotics. Unsurprisingly then, many people worry that these advances will dramatically change work skills in the years ahead and perhaps leave many workers unemployable. This report develops a new approach to understanding these computer capabilities by using a test based on the OECD’s Survey of Adult Skills (PIAAC) to compare computers with human workers. The test assesses three skills that are widely used at work and are an important focus of education: literacy, numeracy and problem solving with computers. Most workers in OECD countries use the three skills every day. The findings raise troubling questions about whether most workers will be able to acquire the skills they need as these new computer capabilities are increasingly used over the next few decades. To answer those questions, the report’s approach could be extended across the full range of work skills. We need to know how computers and people compare across all skills to develop successful policies for work and education for the future.
Clusters & Regions
Richard Florida, Charlotta Mellander, and Karen M. King, Martin Prosperity Institute
This paper examines the phenomenon of “winner-take-all urbanism” and “winner-take-all cities.” Large segments of the modern economy have been shown to conform to a “winner-take-all” pattern as superstar talent draws a disproportionate share of economic rewards. But cities also conform to a winner-take-all pattern in which a small group of global “superstar cities” account for a disproportionate share of talent, economic activity, innovation, and wealth. This article tracks the distribution of several key factors to identify and describe this pattern of winner-take-all urbanism in global cities, comparing the distribution of economic activity or output, innovation (measured as venture capital-backed startups), and wealth (measured as the share of wealth held by billionaires) and compare them to the distribution of population. In particular, the authors look at the disproportionate share of economic activity, innovation, and wealth held by the “alpha” global cities which stand at the apex of the global economy. They find clear evidence of a winner-take-all urbanism across the global economy and the world’s cities.
How National Governments Can Help Smart Cities Succeed
Joshua New, ITIF
Cities around the world are undergoing two important transformations. First, they are growing. For the first time in history, a majority of the world’s population lives in urban areas. Second, they are beginning to evolve into “smart cities”—cities capable of collecting and analyzing vast quantities of data to automate processes, improve service quality, provide market signal feedback to users, and to make better decisions. While city governments can and should manage much of this transformation, national governments have an important role to play in accelerating and coordinating the development of smart cities. Indeed, the long-term success of smart cities in any particular nation will likely depend on whether the national government supports their development.
Electric Vehicle Capitals of the World: What Markets are Leading the Transition to Electric?
The International Council on Clean Transportation
This briefing provides an update on the global electric vehicle capitals—that is, the cities leading the transition to electric drive with greater sales and sales shares than other markets. It identifies 20 electric vehicle capitals: Beijing, Hangzhou, Qingdao, Shanghai, Shenzhen, Taiyuan, and Tianjin in China; Paris, France; Tokyo, Japan; Amsterdam, Rotterdam-The Hague, and Utrecht in the Netherlands; Oslo and Bergen in Norway; Stockholm, Sweden; Los Angeles, New York, San Francisco, and San Jose in the U.S.; and London, United Kingdom. Analyzing these markets at the metropolitan area level, this report assesses electric vehicle sales in these markets through 2016, identify innovative electric vehicle support policies in these markets, and compare their charging infrastructure.
Ontario’s Global Trade Strategy: Seizing Global Opportunities
Ontario
Ontario’s Global Trade Strategy, is the next step in helping businesses grow and diversify the province’s international trade. It provides them with the tools, programs and resources they need to enhance market knowledge, to establish international market presence and business intelligence, and to overcome challenges. The government also supports access for Ontario businesses to the world’s markets through modern trade agreements that require government cooperation and advocacy to promote economic growth, greater competitiveness, and business opportunities. Businesses in Ontario make, and provide, first class goods and services. By working together, government and business can ensure that these goods and services find their way to lucrative international markets. To be successful, Ontario is taking a whole-of-government approach from policy leadership to program development and implementation. Ontario has demonstrated its capabilities through its leadership role in trade negotiations, and its ability to identify key markets through detailed analysis of potential opportunities and emerging trends, market entry considerations and the province’s export strengths.
Statistics & Indicators
The 2017 State New Economy Index: Benchmarking Economic Transformation in the States
Robert D. Atkinson and J. John Wu, ITIF
To be well positioned to take advantage of technological innovation and thrive amid the ebbs and flows of the global economy, states need to be firmly grounded in what we and others have called “New Economy” success factors. This report assembles an index of 25 indicators across five economic categories to assess states’ fundamental capacities to successfully navigate an economy driven by technological innovation. It measures the degree to which state economies are knowledge-based, globalized, entrepreneurial, IT-driven, and innovation-based. The report then discusses some overarching strategic issues facing states, examines the role of large and small businesses in driving growth, and finally discusses a number of innovative models around the nation to spur workforce training and technology commercialization.
High-Tech Industries: The Role of FDI in Driving Innovation and Growth
SelectUSA
This brief explores the landscape of high-tech industries in the United States. This report defines high-tech industries, examines where they are concentrated across the United States, explores unique characteristics of foreign direct investment (FDI) in the high-tech sector, and finds that FDI is a significant contributor to the competitiveness of the U.S. high-tech sector. In turn, high-tech industries are important drivers of growth for the U.S. economy. These industries advance innovation, employ millions of highly skilled and highly educated workers, further U.S. competitiveness in an increasingly globalized world, and contribute to greater prosperity in our communities. The high-tech sector’s impact on the U.S. economy is strong; high-tech industries accounted for nearly 25 percent of total U.S. economic output in 2016. High-tech industries employed nearly 18.3 million Americans – 14.6 percent of all U.S. employment. In 2016, high-tech industries accounted for nearly $3.9 trillion in value-add, meaning contributions towards U.S. GDP measured by the final value of goods and services they produced within the United States. The total gross output of hightech industries, including both final and intermediate products, amounted to more than $7.1 trillion in gross output in 2016.
Policy Digest
Made in Place: Small-Scale Manufacturing and Neighborhood Revitalization
Smart Growth America
Technological and economic changes have created new opportunities in small-scale manufacturing and the “maker” economy, which present a chance for communities to make progress on several important economic development issues. Small-scale manufacturing can grow local entrepreneurship and small business, develop or enhance new and existing economic sectors, and revitalize downtowns and business districts. Using tools and case studies, this whitepaper builds the case for why economic development practitioners should be thinking about working with small-scale manufacturers, how to grow the sector, and the particular synergies that are created when locating these businesses in downtowns and mixed use centers. The overall goal of this initiative is to help communities grow their small-scale manufacturing and help their community revitalization efforts. It takes explicit advantage of the fact that small-scale manufacturing can help downtown revitalization and that small-scale manufacturing can benefit from and thrive in downtown locations. This whitepaper brings together lessons from the technical assistance cities and lessons from around the country and identifies four actions that can be taken to help put these ideas into practice in your community.
HOW CAN YOUR COMMUNITY ENCOURAGE AND GROW SMALL-SCALE MANUFACTURING?
Find, connect, and support small-scale manufacturers. Many jurisdictions do not have a readily accessible list of small-scale manufacturing businesses or know who owns these enterprises. Economic development practitioners can build a database of small-scale manufacturing business owners to understand the locations as well as the types and sizes of spaces the businesses need. Communities will need to invest in purposeful outreach to identify business owners who are people of color, women, and from local immigrant populations, since these businesses are often not tied into the existing business networks. Outreach such as this will ensure that small-scale manufacturers know who to contact for financing, space needs, infrastructure issues, and city permits. Local attention also increases their likelihood of remaining in the community. The community’s economic development team can provide a number of different types of support and connections:• Identify local, small production businesses through local fairs, markets, ethnic and religious institutions, and by hosting informal networking events in target neighborhoods.
- Recruit small-scale manufacturers to target retail locations in the community to support reinvestment and build up the attraction and energy in an area. Provide matchmaking services for potential tenants with local developers interested in this sector.
- Connect business owners to resources like commercial shared kitchens or makerspace facilities to expand their production at low risk.
- Provide small business training and entrepreneurship programs specific to the needs of production businesses, similar to those provided to other types of local businesses.
- Create a marketing brand for locally made products, with an online directory of participating manufacturers and products.
- Establish a one-stop shop either within the local government or at a partnering non-profit to ensure that small producers know where to go for help.
Identify funding sources. Often local and regional economic development agencies lack funding programs to support smallscale manufacturing businesses. Lenders, both public and private, may not be familiar with businesses that manage supply chains and product delivery, or micro-enterprises with small margins. Community development corporations may not be familiar with how to finance coworking facilities for multiple small manufacturing businesses. Local governments can create programs that connect small producers to micro-lending, and invest in buildings that provide low-cost space for local producers or a product-based incubator or accelerator. Local and national banks’ small business banking sectors can also be valuable partners. These partners can work together to create a series of funding programs:
- Create or repurpose a municipal revolving loan program to offer small businesses low-cost loan terms that they may not receive with a short credit history.
- Leverage federal community development block grants (CDBG) to fill financing gaps in shared production facilities or startup training programs that benefit under-represented populations.
- Build a network of local banks that are committed to local small business growth and connect successful small-scale manufacturing businesses to this group.
- Initiate an entrepreneur loan fund targeted to minority- and women-owned production businesses, potentially in partnership with business training or financial literacy programs where needed.
- Employ U.S. Department of Agriculture programs in small towns to fund food business incubators and makerspaces. Consider programs such as the Value-Add Producer Grant or other Rural Development program funding sources.
- Utilize the U.S. Economic Development Administration Public Works and Economic Adjustment Assistance Program to fund infrastructure improvements, site acquisition, rehabilitation and equipment for small manufacturing. These funds have been used to fund “Made In” branding programs, business incubators, and commercial kitchens.
- Provide Tax Increment Financing (TIF) or Payment in Lieu Of Taxes (PILOT) awards for a development’s commitment to below market lease rates for small manufacturing businesses in target locations.
- Help to connect Community Development Finance Institutions (CDFIs) with small-scale manufacturers. CDFIs have experience funding unconventional borrowers to help small businesses meet their goals.
Encourage small, light industrial space in local developments
Small-scale manufacturing businesses need affordable space to produce their goods. This often means that jurisdictions must be proactive to protect existing light industrial space in target locations and to encourage new small production space in redevelopment and new construction projects. Local land use policy and financing must support this outcome. Communities will benefit from policies that keep small production within neighborhoods to retain good middle-income jobs and the vibrancy that comes with this business type.
- Ensure that existing commercial zones and building codes allow artisan manufacturing businesses. Add an artisan manufacturing definition to the local land-use code if needed.
- Create an incentive in target zoning areas to develop a minimum square footage of ground floor microenterprise space for small manufacturing businesses. For example, an incentive might be to provide a density bonus in exchange for development of affordable space for production within a new mixed-use project or reuse of older industrial properties central to the community.
- Develop an overlay zone to protect existing industrial buildings from conversion to other uses, or create a district designation that both protects these uses and allows for live-work space and some commercial development.
- Consider zoning that allows office and retail development on vacant industrial properties if new development includes a minimum square footage of new light industrial development as well.
- Work with private developers to redevelop surplus city-owned properties with a requirement to include a minimum square footage for small-scale manufacturing businesses.
- Connect community development corporations or private developers to new market tax credits (NMTC), historic preservation tax credits (HPTC) to reduce the cost of redevelopment for a project.
Create cross-sector partnerships
For small-scale manufacturing to succeed, partnerships need to be forged throughout the private, philanthropic, and non-profit sectors. Economic development professionals can convene these stakeholders and develop goals to support small-scale manufacturing, identify training needs, and bring additional partners to the table. Anchor institutions, community colleges, local Urban League chapters, workforce development programs, and cultural and ethnic institutions can all serve key roles in this process.
- Engage local non-profit organizations that work directly with businesses owned by people of color, women, and local immigrant populations to build an inclusive network and services.
- Build a partnership with anchor institutions that commit to purchasing a minimum percent of supplies or services from the local small-scale manufacturing community.
- Convene local philanthropy and corporate investors to support makerspaces, apprenticeships, and workforce training programs with placements in local manufacturing jobs.
- Partner with community colleges to offer vocational training that includes industrial manufacturing tools as well as entrepreneurship programs for the trades.
- Work with workforce development programs to help small-scale manufacturers find local hires, and showcase manufacturing employment opportunities through internships, events, and school trips.
Events
WICK2017: 5th PhD Workshop Economics of Innovation, Complexity and Knowledge
Turin, Italy, 19-20 December, 2017
The aim of the workshop is to bring together young researchers from different disciplines and provide them a circumstance of discussion of both full and early works. The main topics the workshop will cover are Economics of Science, Firm and Regional Innovation Strategies, HR Analytics and Economic Philosophy. The event will feature keynote contributions from Dr. Frank Neffke and Dr. Torsten Heinrich.
GeoInno2018: 4th Geography of Innovation Conference
Barcelona, Spain, January 31st, 2017 – February 2, 2018
The aim of this event is to bring together some of the world’s leading thinkers from a variety of disciplines ranging from economic geography, innovation economics, and regional science, as well as economics and management science, sociology and network theory, and political and planning sciences.
The 12th Workshop on the Organization, Economics, and Policy of Scientific Research
Bath, UK, 27-28 April, 2018
As in previous years the aim of the workshop is to bring together a small group of scholars interested in the analysis of the production and diffusion of scientific research from an economics, historical, organizational, and policy perspective. We aim to attract contributions from both junior and senior scholars; a minimum number of slots are reserved for junior researchers (PhD students or postdoc scholars who obtained their PhD in 2015 or later).
Manchester, UK, 5-8 September, 2018
Across the world, states and city regions are facing huge societal, economic, environmental, and political challenges whose solutions require concerted new efforts and innovative partnerships. The 2018 International Triple Helix Conference brings together academia, government, business, and community to share effective practices and to advance the frontiers of knowledge about collaboration for economic progress, social development and sustainability, and the role of cities and regions as enabling spaces for these interactions.
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This newsletter is prepared by Jen Nelles.
Project manager is David A. Wolfe.