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BBA Economic Digest: Home Alone


Photo by Roberto Nickson on Unsplash

More Are Doing It

Here's something that economic developers are going to have to wrap their heads around -- more people are working from home.

St. Louis Fed researchers found that more than 3 percent of American employees primarily worked from home in 2017, up from 0.7 percent in 1980, reports Axios. That number rises to 4 percent for workers in sales, and 5 percent for workers in management, business and finance.

Sounds small. It's not. In Boulder, Colorado, 9 percent of full-time employees work primarily from home.

"The technological substrate of collaboration has gotten shockingly good over the last decade," wrote Stripe CTO David Singleton, announcing that his company's fifth engineering hub would be "remote."

America's self-employed have been working from home for decades. (All our BBA team members work from home.) Now full-time employees are beginning to discover the attractions of avoiding the dreaded open office.

"I've found it's helpful to point out that remote work (while not 100% true) is often economic base activity. Those are paychecks derived from other cities so that's cash flowing in and expertise/time flowing out - this export creates positive ripple effects," writes John Pernsteiner with the labor market analytics firm Emsi.

"Tracking this can be done, just not through traditional BLS reports. It's not a hard sell to get an economic developer on board with this, you just have to help them quantify it so that there's measurable and presentable metrics to their stakeholders."

What can economic development organizations do to assist those working from home? Faster broadband and more public hotspots would be a huge help.

Back in Bama

Later this week, I'll be going to Alabama, my old stomping grounds, where I look forward to connecting with old friends and making new ones.

I'll be speaking at the winter conference of the Economic Development Association of Alabama. The conference theme is the future, and I'll talk about how artificial intelligence will change our jobs and our lives, immigration, and people and communities that could be left behind in this Fourth Industrial Revolution.

But before EDAA in Montgomery, I'll be in doing a marketing audit for the Lake Martin Economic Development Alliance, which includes Tallapoosa and Coosa counties. (By the way, this group is looking for a new executive director. Fine community.)

After meeting with the Lake Martin folks in Alexander City, I'll head to a remote farm in Chambers County where I will spend several days with old friends. No internet, no cell phone service. Ostensibly, we're there for deer hunting, but I won't shoot a deer. It is quite likely, however, that I will drink a little bourbon at night and tell some just outrageous tales.

I'll have to be much more truthful once I'm at EDAA. I'm particularly looking forward to Day Three of the conference, which is dedicated to rural economic development. Working with rural communities is a passion of mine.

Finally, I'll head north to Huntsville, where I'll visit the HudsonAlpha Institute for Biotechnology and see other things as planned by the Huntsville/Madison County Chamber, where lots of good things are happening. (See next story.)

From 1984 to 2007, I called Alabama home, working 14 years for The Birmingham News and then for the Economic Development Partnership of Alabama. I'm a Texan now, but I'll always have warm feelings for Alabama.

Roll Eagle! War Tide! Wait, I got that all wrong. Been gone too long.

Way Up North in Huntsville

As many of you know, Mazda and Toyota are jointly building a $1.6 billion auto assembly plant in Huntsville, Alabama, in the northern part of the state bordering Tennessee.

Mazda Toyota Manufacturing USA have started hiring production workers, which will represent most of the 4,000 workers expected to be hired once full production is achieved at the 3.7 million-square-foot facility.

The jobs are full-time work in plant operations such as welding, paint, stamping, quality control and conveyance. They are physically demanding, the companies say, and will involve repetitive motion, moderate lifting, use of machinery and prolonged standing. Pay will start at about $17 an hour.

The plant sits on a 2,500-acre site in the Limestone County portion of Huntsville off Interstate 565. It is expected to turn out 300,000 Mazda and Toyota vehicles annually with production to begin in 2021.

MTMUS is not the only big project in the works for Huntsville. The FBI is currently building a new outpost at Redstone Arsenal that will bring 4,000 new jobs.

Way Down South in Mobile

On the opposite end of the state, Airbus recently announced that it will expand production at its plant in Mobile, where it will spend $40 million to construct new facilities and add 275 jobs.

As part of a plan to build 63 aircraft in its A320 family of planes per month, Airbus said it would increase production in Mobile to seven airplanes monthly by early next year. Airbus, which began producing aircraft in Mobile in 2015, employs about 1,000 people at the site assembling A220 and A320 models.

The company added about 600 jobs in the city last year. Airbus now employs 1,000 people at the manufacturing site, located at the Mobile Aeroplex at Brookley. The company also operates an engineering center at Brookley that employs 220 and an Airbus Defense & Space unit that employs 70.

The latest expansion announcement, which puts Airbus on a pace to produce more than 130 aircraft annually in Alabama, came amid a tariff dispute.

A World Trade Organization panel ruled in December that the European Union had not complied with an order to end illegal subsidies for Airbus. The Trump administration imposed tariffs on nearly $7.5 billion worth of EU goods in October.

Before Economic Developers

Well before any economic developers were on the scene, Birmingham, Ala., became known as the "magic city" due to its incredible population and industrial growth in the late 19th century.

No doubt, I'm stating the obvious in pointing out that before the profession of economic development came into being, cities and towns in America were growing because of new job creation and capital investment.

When I see a press release stating that in 2019, x number of new jobs were created, x number of jobs were retained, and x amount of capital investment occurred, I have to wonder to what degree the local economic development organization (EDO) played a role in making it happen.

In some cases, a lot. In others, not so much if at all. I mention this only because economic developers will often get both undue credit and blame for things outside their control.

Measuring an EDO's effectiveness based on job creation and capital investment may at times seem inadequate and unfair, but it remains the general yardstick. I believe economic developers can be and often are huge change makers in their communities, but measuring their effectiveness is not always so easy.

Photo by Tomas Robertson on Unsplash

What We're Reading

A Pilgrimage to the Pub at the End of the World Outside

Old Musicians Never Die. They Just Become Holograms. The New York Times Magazine

Martin Luther King and the polite racism of white liberals. The Washington Post

What Happened to Baltimore’s Harborplace? CityLab

The Silicon Valley Economy Is Here. And It’s a Nightmare. The New Republic

Climate change means the US must start building big things again MIT Technology Review

They'll Have It Covered

On his third day of a summer internship at NASA’s Goddard Space Flight Center in Greenbelt, Md., 17-year-old Wolf Cukier, of Scarsdale, N.Y., discovered, you guessed it, a planet.

Now known as TOI 1338 b, the planet is nearly seven times as large as Earth and has two stars — one that’s about 10 percent more massive than our sun and another only a third of the sun’s mass and less bright, according to NASA

While at NASA, Cukier was placed under the tutelage of scientist Veselin Kostov, who had never had a high school intern

“I gave him a brief outline of what we do, and he learned everything by himself,” Kostov told The Washington Post. “He learned really quickly. He really developed a very good understanding of the field.”

Now a high school senior, Cukier has his sights set on colleges such as Princeton University, Stanford University and MIT where he can major in astrophysics or physics.

My take: When I hear fellow Baby Boomers decry about "these kids today" -- a generational complaint that I suspect has been common through the ages -- all I need to do is point to Cukier. I'll say something like this:

"You know, I think they'll have it covered. I doubt they'll do any worse than us. They might just do a heck of a lot better."

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