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BBA Economic Digest: Changing Lives


What the Hell is Economic Development For?

Within days of the assassination of President John F. Kennedy, the new president, Lyndon B. Johnson, made an exceedingly risky decision to champion the stalled civil-rights bill.

When an adviser tried to persuade Johnson not to waste his time or capital on the lost cause of civil rights, Johnson replied, “Well, what the hell’s the presidency for?”

I pose a similar question to my economic development friends: "What the hell is economic development for?"

Most economic developers know that what they do is fundamentally right, and that they are in fact giving back to society. It's why the profession is so addicting. So what is economic development for? I believe the answer is clear -- to change lives. As famed business consultant Peter Drucker said, "changing lives is always the starting point and the ending point."

My Trophy Hunting Days

About 20 years ago, I thought economic development was defined by industrial recruitment. My job at the Economic Development Partnership of Alabama was to go fish and land the big ones. Trophies really.

The job took me all over the world. I drank beer in a Hofbräu house in Munich and ate things in Singapore to this day that I'm not sure what they were. I barely kept my breakfast down in a small helicopter in Brazil whose pilot was intent on proving his aerial acrobatic skills. (I hate helicopters.)

Today I know that economic development is much more than business recruitment, although I still come across organizations in which that is their sole function.

Here's the deal, recruitment is always, always a long shot. The overwhelming majority of new jobs are recreated by existing industry, and if there is not a robust business retention program in your community, you are not practicing economic development to its fullest extent. The same holds true with entrepreneurial development.

I recently visited a metro area of 300,000 in the Midwest, where the urban landscape is being transformed by a burgeoning, home-grown tech scene. If this community won one recruitment project a year, they would be ecstatic, but that's not their emphasis, and I think rightly so.

People Follow Jobs and Jobs Need Beds

Housing availability and affordability is not just a big metro problem, but it's also affecting much of small town and rural America.

The number of households spending at least half their income on housing has risen significantly in rural counties, a category the federal government calls “severely cost-burdened.”

Losses of high-paying jobs are the culprit in some rural communities, while in economically revived areas, new workers vie for rental housing, putting pressure on prices in a rental market with a limited supply.

I've been to rural communities where I wondered where an incoming company would find adequate housing stock for incoming employees should the company start up operations there. Bottom line: People follow jobs and jobs needs beds.

Every year the number of U.S. households grows by more than 1 million, while simultaneously somewhere between 300,000 and 400,000 existing housing units are demolished.

"Affordable housing isn’t affordable to build," the National Apartment Association's Greg Brown tells Axios. As America urbanizes, the shortage of apartments and houses is growing even starker.

There's currently little economic incentive for homebuilders to build new units for Americans shut out of the market, especially in rural places.

Companies Selling Values

If you watched the Super Bowls ads, you may have notice that some companies were more intent to sell you on their values, rather than their products.

Squarespace ran a 30-second ad as part of a campaign featuring Winona Ryder heading back to the small Midwestern town of Winona that she's named after. The ad aims to shed light on American towns and the small businesses that fuel them. I liked it.

The NFL ran a 60-second ad addressing police shootings of African Americans. The ad, which stars retired wide receiver Anquan Boldin, is being used to promote the NFL's "Inspire Change" social justice program.

Olay's 30-second ad mocked the idea there isn't enough space in space exploration for women. It comes almost a year after NASA had to postpone the first all-female spacewalk because there weren't enough properly sized spacesuits for the two women. Every tweet will be matched by a $1 donation to Girls Who Code.

My personal favorite: Bill Murray in the Jeep commercial "Groundhog Day."

Fort Worth's Cowboy Culture

Something that I picked up on soon after moving to the Dallas-Fort Worth area 10 years ago was the antipathy between the two named cities. Both are proud (heck, they're in Texas), and each have branded themselves quite differently from the other, which is actually quite smart.

Fort Worth embraces its cowboy culture, whereas Dallas does not, despite the name of the NFL team. A city of nearly 900,000 people and the 14th largest city in the U.S., Fort Worth is taking advantage of its longhorn heritage with hopes to become a major sports and entertainment center.

Its new $540 million arena will host one of the world’s oldest indoor rodeos, and the city is reinvigorating its stockyards district.

My go-to watering hole in Fort Worth is the White Elephant Saloon, once billed a gentlemen's saloon (women were not allowed in Old West saloons unless perhaps they were of a particular profession) that offered top-of-the-line gambling and ‘the best brands of old sour mash whiskeys in the state’ as well as ‘ice cold’ beer."

The White Elephant was the scene of more than a few gunfights, and it won a respectful mention in the 1907 memoirs of lawman-gambler Bat Masterson. Keeping with Fort Worth culture, hundreds of cowboy hats are nailed to the ceiling.

Consistency Builds Trust

Probably the single most important factor in establishing effective marketing is consistency. You can make all sorts of mistakes -- and trust me I have -- but the more consistent your messaging is in terms of frequency and content, the more you will build awareness and develop trust and loyalty.

And that's the name of the game in creating customers. You must have good, distinctive content, and then you keep at it, over and over again, which is hardly easy. I'm sorry, but I don't believe you can develop a unique and identifiable voice and gain a following with an occasional magazine ad. (Certain publications will love me for saying that.)

Consistency, consistency, consistency, and then pick and dominate at least one social media channel. For me, it's LinkedIn. For you, it might be another.

'Tis a Hard Life

The work involved with economic development consulting is something that most people will never understand or appreciate. But you do what you have to do.

And so at the Polaris Industries plant in Huntsville, Alabama, I rode in what they call a "Slingshot." And then later at the Fret Shop in Huntsville, I played guitar and banjo. And the thing about it is that I won't be able to invoice for any of these things. Can you believe that?

'Tis a hard, hard life that I have chosen.

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