The goal of
economic development is to
improve the standard of living and quality of
life by encouraging business investment,
higher wage jobs and more skilled
employment, and an infrastructure that will
support this. The success of this effort is
dependent on the knowledge, skill, and
experience of the people involved.
Virtually
everyone on the county
economic development staff has “made a
payroll.” We come from the business
community and understand the problems
and considerations of a business owner. We
are part of our community and we know this
is not a fast process, but one that often takes
two to three years to produce a successful
result for the community.
One might say “OK, but aren’t
economic growth and economic
development the same?”
This is
another myth. The reality is
economic development focuses on
improving our community. Growth is about
more rather than better. Growth, as we know
so well, can produce additional costs without
raising the standard of living. Increased
traffic comes from growth, but few of us
would think our lives are better for it.
The next myth
we hear is that “if we
only had another General Electric, things
would be great.”
Sure, GE—which
had a plant in
Daytona Beach years ago—was a major
supporter of the economy for this area for a
long time. When this company left the
community was devastated. Yet out of the
ashes grew a number of new companies,
such as Raydon.
Almost all new
jobs are created
by entrepreneurial and innovative
smaller companies.
This is borne
out by the new
“Economic Gardening” program
created by the state and derived from
successful models in other states.
The program is
designed to take
smaller, but seasoned, companies to
the next level of their growth where a
large number of new jobs will be
created as a result of new skills
imparted by experts to the
entrepreneurial management. The
skills needed for a successful startup are not
necessarily the skills needed to achieve new
levels of growth.
Changes in the
economy, whether
growth or recession, typically drive startups.
These fledgling ventures are formed in
response to perceived needs arising either
from economic growth or a recessionary
period such as we have been experiencing.
They arise
from an idea and an inability to
find employment. Startups, regardless of the
initial motivation, have relatively high failure
rates. Further, they are likely to remain small.
We’ve heard “we need to focus on
‘clusters’ and recruit businesses accordingly.”
Realistically,
clusters are a useful way to
define concentrations of related industries.
However, globalization and instant electronic
information transfer tend to eliminate the
need for businesses to be in proximity to
each other. Heavy industries tend to want
their suppliers within a specified delivery
time.
The most
successful clusters are home
grown. A successful incubator program, as
demonstrated by one of the country’s
leaders, the University of Central Florida
(UCF), fosters both technology transfer to
scalable entrepreneurial ventures and other
startups. UCF has an 87 percent success rate
for its incubated companies. Most of those
companies will stay in the area because the
workers and environment that fueled their
growth are there.
But aren’t
jobs in manufacturing
declining because plants are moving
offshore?
The reality is
that most jobs lost are
because of the increase in technology
through computers and automation. Low wage
assembly jobs will seek out low-cost
locations on a global scale.
Further, many
of the manufacturing
operations that go offshore are serving new
overseas markets. Very often, the price of the
dollar drives the decisions. If I’m a
manufacturer the exchange rate makes my
product less expensive.
Conversely,
the current favorable
exchange rate of the dollar versus the Euro
has European manufacturers looking to set
up manufacturing in the United States for
their products.
Exporting is
an economic sleeper that
most often is overlooked. China is our fastest
growing market for U.S. goods, increasing an
average of 24 percent per year since 2001.
Exports from
Volusia County manufacturers
have risen almost 8 percent since 2006 -
some $21 million, and increased total Volusia
County exports to almost $290 million.
Volusia County Economic Development
Division-led trade missions to Europe
generated sales in excess of $10 million in
2009 alone.
Another myth
is that economic
incentives drive the relocation decisions.
The reality is that while incentives are
an important factor, we have managed to
continue to bring higher-wage jobs to
Volusia County, not through incentives, but
because of our assets.
Assets? You
bet, a great workforce is the
key to the success of any business. Our
superb location—at the apex of two
interstate highways—and lower operating
costs are going to mean more in the long run
than tax refunds.
Smart
decision-makers are going to
look at those attributes to continue their
success when the tax-refunds are gone.
