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Viewpoint – All economies are local

Opinion-icon-for-website[1]A better jobs and growth strategy for towns and cities

By Christopher Robbins

Massachusetts communities can no longer rely on state or federal aid to fill their budget gaps. Therefore, each municipality must take responsibility for its own economic fate.

Towns and cities are failing to take advantage of economic development opportunities and tax revenues.  They do not understand how to create the optimum number of local jobs, nor understand municipal metrics that determine their economic well-being. They lack knowledge about their industry clusters, especially about which are thriving or struggling. They do not know the decision makers at those enterprises who pay business taxes and create jobs.

Governor Deval Patrick's Economic Development Policy and Strategic Plan, “Choosing to Compete in the 21st Century,” recommends that each municipality needs a “CEO” and team to create and implement an economic development plan for job growth. Many municipalities are forming economic development corporations or committees to encourage new business establishments, developing supportive customer service policies, and providing predictable regulatory processes that are committed to respecting developers and residents.

TechSandbox, an incubation center for technology and science startups, moved to  Hopkinton after selectmen voted to waive building permit fees and explore a special tax deal—the kind of public-private partnership that is key to supporting small business, creating new jobs for the innovation economy, and encouraging growth.  Marlborough formed an Economic Development Corporation that works with municipal and private investors to create jobs and community revitalization. Cambridge and Somerville implemented Buy Local First programs to build sustainable local economies and vibrant communities.

To enjoy the benefits of a robust economy, each municipality must become a high performing, self-reliant economic engine operating on four cylinders: residential; business; public sector; and nonprofit.  Each cylinder represents an indispensable component of the local and regional economy, employing thousands and fueling millions of dollars of activity through wages, the purchase of goods and services, and payment of taxes.

To understand how these components influence our municipal and regional economies, towns and cities can design and implement a three-step process.

 Step one, develop your municipality's economic profile.  Include an appropriate set of metrics, and then track their historical performance. With this information, a municipality can better understand how its local economy works—its strengths, weaknesses, and hidden potential. Examples of these metrics include payroll data from local employers; tax rates, school budgets and per-pupil expenditures; housing starts and trends; municipal revenues; cost of living measures; number of employers by sector; job statistics; population trends; and demographics.

An excellent source for data relating to economic conditions is Framingham State University's MetroWest Economic Research Center. MassBenchmarks provides information concerning the performance of and prospects for the State's economy which gives a context for a local and regional economy. It's published by the UMASS Donahue Institute with the Federal Reserve Bank of Boston.

Step two, develop an economic portrait of the primary industry and small business clusters. Include nonprofits, and possibilities such as: manufacturing, software, medical devices, financial, education, healthcare, information technology, leisure / hospitality, public sector, construction, legal, retail, professional, and business services. That portrait will provide a wealth of information and assist municipal leaders to answer three questions:

1. How do we support locally owned businesses?

2. What industries should we strive to retain or attract?

3. Are we too dependent on any particular industry?  If so, how might that dependence be a

problem or strength for encouraging job growth?

Only a diverse business base can help municipalities survive economic storms and capitalize on opportunities during prosperous times.

Within industry clusters, metrics can be highlighted, including: number of local employees, top employers, income data, products and services made or provided locally, economic outlook for each sector, and contact information for business and nonprofit leaders. Outreach then becomes possible. The Southborough Economic Development Committee schedules meetings monthly with business and nonprofit leaders to learn how the town can help them prosper.

MIT developed a Community Economic Development Tool Box, where one can view profiles of economic indicators by county and compare the profiles to state and national data.  The website, mass.gov/lwd/economic-data/, (click on: other resources / municipal data), as well as municipal tax rolls are good sources for identifying your local businesses.

Step three, create and communicate your action plan to interested parties.  Collect and interpret your municipal financial data and trends. Integrate your economic profile, portrait information, and economic development action plan into the annual municipal budget process. Review of this information can be useful in determining the best opportunities and to plan next steps for job creation and growth.

Then, explore opportunities to create public-private partnerships to reduce the cost of government, lower residential taxes, and improve the delivery of core services.  To succeed, each municipal and state leader must be held accountable for job growth and our economic well-being. In this way, we can ensure our fiscal stability and quality of life.

    Christopher Robbins is a member of the Economic Development Committee of Southborough; Board of Directors: Corridor Nine Chamber of Commerce, and Past President, Southborough Business Association.

 

 

Short URL: http://communityadvocate.com/?p=44717

Posted by on Jan 16 2014. Filed under Business, Byline Stories, Letters to the Editor, People and Places. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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