Economic development

Businesses hate red tape

Take a tip from what Europe is doing wrong, and use it to give your own region a little boost. This report says businesses are moving their plants and investments into the U.S. and Asia, where the regulatory climate is less onerous.

Do your economic developers regularly talk to local businesspeople to find out about red tape problems? Can you do more to make it easier to start and to run a business in your community or region?

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The iPod generation

If your job involves working with youth, or if it should (economic developers take note), you may want to read this article about the kind of people that visit Apple's iTunes Music Store. You might call people that fit the profile the "iPod Generation."

Communities with broadband prosper

One of the problems with community investments in broadband is the lack of data showing the value of such investments. Community leaders are somewhat wary of spending public money on unproven infrastructure. A new study from Carnegia Mellon and MIT shows that communities that have invested in broadband infrastructure are doing better from an economic development perspective than communities that have not.

The research team used extensive government data to analyze these investments and to develop the conclusions--this is not some casual vendor report.

Economic development of the future

With a hat tip the excellent Connecting People blog, here is a link to what looks like a great new source of economic development ideas and concepts for the Knowledge Economy.

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Thirty percent of households shop online

The New York Times (registration required) has an article on the growth of online shopping during this holiday season.

Two numbers stand out: There was a 25% increase in Internet sales over last year, and about a third of all U.S. households bought something online. And L.L. Bean took more orders over the Web than over the phone, which is a watershed.

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Economic Development blogging

This new blog is a great example of the potential of local blogging to enhance economic development and to educate/inform local leaders and citizens. This new Blacksburg area blog has a nice mix of job opportunities, economic development news, and leadership issues. It is just what is needed in many local areas.

Denmark nurtures microbusinesses

Here is a report from Denmark about how one group is trying to nurture and promote the growth of microbusinesses. Stick with the article to the end, and you will find a useful list of activities and projects that would apply in any community or region. Does your economic development game plan include these kinds of activities?

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iPod for real estate

This very short article discusses a new use for the video iPod. Real estate agents are making short video clips of homes for sale and making them available for download into a video iPod. Other agents can download the videos and to learn more about a property and/or show the videos to prospective home buyers.

Outsourcing comes home

This article suggests the tide may be starting to turn on the loss of manufacturing jobs to overseas factories. A Wisconsin cookware company is starting to bring jobs back to the Midwest because of rising labor costs overseas and drastic increases in the cost of shipping.

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Counting the microenterprise

In New Hampshire, economic developers did a study of business ownership and found that 18.5% of all private, non-farm employment in the state was tied to microenterprises. A microenterprise is defined as a business that employs between one and five people, including the owner, and requires no more than $35,000 in start up capital (Business NH Magazine, March 2005).

So in New Hampshire, a fifth of the economy is based on companies with less than five people!

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Redundant cable paths

I have been talking to communities about the importance of redundant cable paths for years. If you don't have at least two entirely separate cable paths into your community for telecommunications, your community, and especially your businesses, are at risk.

The most mundane risk is having a cable cut by a contractor digging somewhere. But as a painful example of what can go wrong, one of the primary fiber cable routes into New Orleans was across the Pontchartrain bridge, which suffered enormous damage.

Telecom companies are trying to patch other routes together to get Internet and phone service back into the city, but it is a sober reminder that we have to plan for disasters--the routine ones, like a wayward backhoe, or something much worse.

A question for your economic developers

Lately, I've found a very simple way to find out if the economic developers in a community or region are staying current with job and employment trends. I ask them just two very simple questions.

Question one: How many people in the United States make a full time living from eBay?

Question two: How many people in your region make a full time living from eBay.

The answer to the first question is easy. Currently, about 724,000 people make a full time living from eBay, up from a half million last year.

If your economic developers don't know the answer to the first question, your region is in trouble, because it says your economic developers are not keeping their eye on microenterprise trends and the ability of microenterprises to contribute significantly to the local economy.

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Designing an ecommerce Web site that works

Jakob Nielsen is an expert on Web usability, and he has a short, very readable article about how to design a business Web site.

Nielsen looks at Amazon and provides an interesting critique of how that ecommerce giant clutters their pages with stuff--on one page he counted 259 links to other information and sites. Although Nielsen says that works for Amazon, almost no other business should be doing things the way Amazon does.

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Friedman's The World is Flat

I was initially skeptical of the heavy hype that this book received in the maintstream media. Friedman writes a column for the New York Times, and it seemed that the praise for the book was a bit over the top. But I finally picked up a copy, and while I still believe Friedman has over-simplifed some ideas and concepts, the book is worth reading.

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South Korea builds a Digital Media City

I write a lot about what is happening in other countries, but some of my citations are just statistics--useful to a point, but sometimes you want more detail. Here is some great information about a single project in South Korea that probably dwarfs many other technology park efforts in the United States, and an indicator of how serious some other countries are about passing the U.S. in technology.

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America still has an edge in the Global Economy

Although I think U.S. communities have to work much harder on their economic development because of overseas competition that simply did not exist even fifteen years ago, we still have a valuable edge. This blog reprints an op-ed piece on some of the problems businesspeople in India face. Red tape, bureaucratic foot-dragging, costly permits, intrusive rent control, and antiquated labor laws make it very difficult to start a business in India.

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Ohio economic development strategy

Pat Valente, the Deputy Director for the Department of Development of Ohio, spoke at the Ohio CDC Technology conference about the state's strategy for economic development. Here are the key points:

  • Focus on the core competencies and strengths of the state.
  • Encourage collaboration among state agencies, industry, and university researchers to help create innovative new products and services.
  • Ohio intends to compete fully in the global economy, and nothing less is acceptable.
  • Translate research into products; Ohio wants to help university researchers translate research results into commercial successes.
  • Entrepreneurs are creating the new jobs, and it is the job of economic developers to nurture entrepreneurs.
  • Provide capital for early stage ventures.
  • Invest in workforce development so that Ohio has workers with the advanced skills needed to find and keep good paying Knowledge Economy jobs.

What is most interesting about Valente's remarks is what went unsaid. There was nothing about industrial recruitment or giving lavish tax breaks to big companies. Ohio is probably still doing some of those things, but the emphasis on entrepreneurs and support for innovation is refreshing. The state is also headed in the right direction by identifying assets and competencies already in the state and trying to leverage those, rather than just imitating what has worked elsewhere or just trying a lot of stuff and hoping something sticks.

As examples of this strategy, Valente mentioned a focus on fuel cells as an alternate power source. The state is funding research to use biomass as a feedstock for fuel cells, leveraging the state's agricultural industry. It is also funding the development of new polymers (plastics) from soybeans rather than fossil fuels, because the state is a big soybean producer.

If Ohio sticks to this plan, it will have an advantage over many other states that don't have the same level of focus. I thought only one thing was missing--a statement of intent to ensure that every business in the state has affordable broadband. If Ohio is serious about competing in the global economy, you can't leave this to chance.

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Has the economy turned a corner?

This article (via InstaPundit) says online advertising has passed the levels seen during the dot-com era. That's interesting, because advertisers want to see a return on their marketing expenditures--if ads don't turn into sales, they don't keep throwing more money into a particular medium.

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Digital Cities: PacketFront talk

PacketFront is a vendor of network equipment designed specifically for community broadband projects. Matt Wenger, an expert in communitywide broadband and senior analyst for the company, gave the talk.

Wenger strongly advocated a services orientation for community broadband projects. His thesis throughout the talk was the current connection-based model used by the telcos and the cable companies discourages innovation and use of broadband.

Broadband and the public good

The Free Press has released three useful reports on broadband that ought to be required reading for any citizen's group trying to convince public officials and economic developers that something needs to be done.


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