When our “leaders” and “economists” don’t understand what drives jobs

Although I hate taking a whole story and quoting it- I’ve included today’s DDN story below. This is because you have to be able to access it later for this to make sense- and the DDN takes stories away after a set time.

Fundamentally- the idea of local government creating jobs (other than in government) is flawed- it diverts energy and resources away from government actually governing (providing basic shared services and stable infrastructure as well as social integrity- ie. a lawful and safe environment). It’s what happens when the military tries to be a police force, they can do it, but it’s not what they are best at.

WSU economist Robert Premus talks about developing “the next generation of technological entrepreneurs,”… people who “know how to make business opportunities out of technology.”

Hmmmm, Austin Texas does that pretty well, with a lot of tech start-ups. And guess, what, those people Premus wants, want to live in Austin- a “creative community” and one that fosters an image of a hip, youth oriented music mecca- once a year with the SXSW music festival. California has always had the lures of sun, fun and at one time- inexpensive super State run schools. None of the population growth and high energy economic environment was bought by government- it was an image of a place to be successful.

It’s sad to hear our counties chief ED director, Joe Tuss quoted “There’s a lot of work being done to generate the next generation of businesses. But it’s a long haul.”

Instead of saying: “Dayton has a lot of underdeveloped value that is ripe for smart companies to reap value from- from low cost of living, to abundant water, to a high concentration of engineers- plus a great cultural scene that rivals or beats other growing communities- it’s my job to change our message and our image to one of success, instead of allowing the Dayton Daily News to continue telling our community our weaknesses.”

Maybe you get the point- maybe you don’t- but our self-esteem as a community makes us one of the hag sisters- instead of a Cinderella- about to score the prince.

Here is a short list of strengths:

  • Sinclair Community College ($36 per credit hour)
  • Abundant water supply
  • Outstanding recreational opportunities (bike trails, 5 Rivers Metroparks- and soon possibly a white water park)
  • No traffic jams (even with I-75 and US 35 construction)
  • Central location for distribution and close proximity to DHL hub in Wilmington
  • No seismic flaws like all of California, or Hurricane risks like the Gulf Coast and Florida
  • Inexpensive real estate
  • 4 seasons (some people don’t like living in the desert or year round 100% humidity)
  • Above average arts and cultural opportunities (DCDC, Rhythm in Shoes, Dayton Ballet, Muse Machine, CityFolk Festival, multiple venues- from the Victoria and the Fraze to the Schuster, The Dayton Art Institute, and even places like Canal Street Tavern)
  • Friendly people (try saying hello to people on the street in LA or NYC)

Read the article below- and see if you think Government can really solve the problems they talk about- or if you think that government would do better to “stick to the knitting” (as Tom Peters suggested in “In search of excellence”) and worked on providing the private sector with a solid playing field to do its thing- and then leave your suggestions.

I don’t claim to have all the answers- but I do believe a little solid marketing smoke and mirrors could do more than throwing tax dollars at businesses to try to get them to move here- because once you start doing that- you are only competing on price- not on the strength of your product.
Local job efforts lack focus, substance, economist says
Region needs to take advantage of its many engineers, says Wright State professor.

By Tom Beyerlein and Margo Rutledge Kissell

Staff Writers

Reynolds and Reynolds Co.’s announcement Friday that it will cut 450 jobs, most of them in the Dayton area, in the next three years underscores the urgency of developing a new wave of local employers, experts said.

That’s easier said than done, they acknowledged, as the area continues to be affected by globalization trends and dragged down by its links to the General Motors supply chain.

“We have an industry mix that’s working against us,” said Wright State University economics professor Robert Premus. While old-school manufacturing employers are in layoff mode, he noted, “we’re not growing major new companies in town.”Like many Rust Belt towns, Dayton has been trying to position itself as a high-tech mecca since the 1980s. But Premus, who has studied the economy for decades, said the efforts have lacked substance and focus.

“We didn’t really get serious about it,” he said. “We talked about it, but we didn’t know what to do.”

The region has more engineers than many high-tech regions “it’s sort of a paradox, Premus said, but they’re mostly tied to Wright-Patterson Air Force Base and the auto industry. “These are good jobs, but it’s not a source of major new industries.”

What the region needs is a much stronger effort to develop “the next generation of technological entrepreneurs,” Premus said, people who “know how to make business opportunities out of technology.”

He said he’s been trying to foster collaboration between Wright State’s business and engineering schools, but there hasn’t been much community support. “It’s been a lightweight effort when what we need is a heavy push.”

Assistant Montgomery County Administrator Joe Tuss said the area is battling national job “trends that we can only impact very minimally” if at all. We’re truly looking at a world economy, and there’s no doubt it’s having significant, long-term negative consequences on this community.”

There are hopeful signs, Tuss said: increasing aerospace medicine research at Wright-Pat, the new RFID Solutions Center near Springboro, a composites center in Dayton.

“Is there a way out of this? I think strategically this community is trying to leverage from its strengths,” Tuss said. “There’s a lot of work being done to generate the next generation of businesses. But it’s a long haul.”

Meanwhile, local United Way chief Marc Levy worries about the human impact of the Reynolds and Reynolds layoffs and other recent cuts.

“It’s another announcement that will continue to reinforce the growing concern that people have about the economy in the local region,” he said of Friday’s announcement.

What’s more, the Reynolds cuts are “in the technology area, which is where much of the growth has been seen and where the optimism is for the future jobs,” Levy said. It’s critical for the community to maintain a strong network of human services “for family and children at a time when resources are seriously being stretched.”

Levy said the waves of layoffs are having a ripple effect in the community.

“It’s getting to the point where everybody is directly or indirectly feeling the impact from this,” he said. “It may be a next-door neighbor, someone you went to school with, who lives down the road, who you see playing golf or out to dinner.”

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10 Responses

  1. pam July 24, 2006 / 8:48 am

    David’s right. Other cities have been doing exactly the kind of thing he’s recommending for years now, and getting results. And tax abatement isn’t one of the techniques. What a surprise.

    Here are a couple of links:

    http://www.npr.org/templates/story/story.php?storyId=1473856

    http://usinfo.state.gov/journals/itdhr/0499/ijde/roundtab.htm

    In the DDN article in yesterday’s post, Joe Tuss sounds like someone with a victim mentality who is just trying to put up a brave front. He could be a little more optimistic. Doesn’t he know that sometimes you have to fake it until you make it?

    Maybe we can’t do anything about global economic trends, but we can make ourselves shine. And if we invest in that, we’ll attract companies and individuals who value it. “If we build it, they will come.”

    I also think that if Dayton wants business to be present in the city, Dayton needs to be present in the business world. Is there anyone reading trade papers and business journals for the city to stay on top of the news and trends? If there were, we could be proactive rather than reactive. Is there anyone representing us at trade shows and conventions? There should be.

    If no one kows how to do it, I’d look at what physician recruiters do to sell doctors on relocation. They’re really good at it.

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  2. PhotoJim July 24, 2006 / 2:08 pm

    There was a time when Dayton had both government and business leaders who understood the necessity of reinvesting in the community. What’s happened now is that the next generation of core capital – aka “people with money” – have vacated that sense of responsibility and commitment. This is partly due to that particular generation’s (baby boomers) sense of self-entitlement and narcissistic tendencies. From the greatest generation comes the most pathetic (I know, Dave, you’re tired of hearing that but I truly believe it).

    It’s also due to the fact that our state leadership in Columbus has allowed the state tax system, Worker’s Comp. program and civil courts to become detterents to anyone in Ohio who desires to start a business and hire people. They automatically become targets for lawful shake-downs, even before they have an opportunity to earn a fair profit.

    There are still plenty of people with capital to invest in Dayton. Just take a look at the parking lots of any of the four or five private country clubs about town (entirely disproportionate and lingering throwback to those glory days). Their money is being invested somewhere and it sure isn’t Dayton, or just about anywhere else in Ohio for that matter.

    In what has filled the void created by the migration of true, honest busisness and civic leadership in downtown Dayton ? Trial lawyers and a few greedy landlords.

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  3. Jeff July 24, 2006 / 9:13 pm
    I don’t know how governent can encourage entrepreneurs to start buisnessess, or even how government can encourage people to become entrepreneurs. I think that has to come from the local culture somehow, and that there is little “government” can do to force this to happen.

    BTW, good comments and blog. I’m glad to see someone is thinking and caring enough about Dayton to post on it.

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  4. Bill Pote July 25, 2006 / 4:45 pm
    I would like to begin this comment by saying thanks to David for his insightful blog. I’ve been reading it for a few months now and I am happy to see that others share both my love for this city as well as many ideas for putting Dayton back on the map. The fact that there are others out there among the many naysayers makes it easier to stay positive – we are not alone.

    I agree with David and the other bloggers – the government should focus less on putting together tax incentive programs to lure businesses, and instead focus on making the city look as nice as it can. That includes finding a solution to all of the riff-raff that loiter on the various corners we all hear about on the news. As a downtown resident, I can tell you that neither my wife and I nor any of my neighbors have ever had any issues here since we moved here over 2 and a half years ago (Cooper Lofts). On our side of downtown there isn’t as much bus traffic as there is on 3rd/4th and Main, which means alot less loitering. Of course, the mentality in the suburbs seems to be that if one corner in downtown appears “dangerous”, then that must mean that all of downtown is a war zone and is unsafe to visit. Perception vs Reality – perception always wins that battle.

    The RTA is finally taking necessary steps of first greatly reducing the number of students transfering through the CBD and then hopefully relocating all of the bus stops on Main Street to a central location a little less visible. That is not to say that I believe all students and bus patrons are riff-raff, but it only takes a few bad apples to turn perceptions negative. Again, I have never had any problems, but I already live here and so I’m not the one that needs to be convinced that it isn’t as bad here as people think.

    The city has made tremendous strides in its efforts to make things look nicer and more inviting. The DDP ambassador program has been a great success (though I believe it is time for the DDP to start talking a little less about that and a little more about their future plans). There is still much to be done – we can’t stop here. Other cities have offered money matches to business/property owners who invest money into improving their facades – perhaps Dayton can do something similiar. The city should also focus on helping property owners attract ground-level tenants to fill the abnormally high number of vacant buildings (i.e. Eva Felman building, Relizon building, etc.). These things will bring life back to our downtown.

    Finally, again David is very correct in his concern about how this city has such a self-esteem issue. We have so many strengths here, especially for how small our city is. Let’s market those strengths and get people excited about our city. Let’s get back to all of us (city dwellers and suburbanites alike) being proud to say we live in Dayton!!!

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  5. David Esrati July 25, 2006 / 5:43 pm

    Hi Bill-
    Thanks for your kind comments.
    However- the vacancy at the bottom of the Eva Felman building was caused by the developers- Hutchins asked Dave Boston to move out- which he did.
    It’s not the cities responsibility to fill those spaces- and in fact- the Relizon space wouldn’t be there had there not been a tax deal and financing deal-
    As to incentives for facade improvements-
    that doesn’t sound like a good investment of tax dollars either-
    compared to changing zoning codes to make mixed use easier- or releasing property owners from parking requirements in the Oregon District- or not fighting every liquor license.
    And why does the Downtown Dayton Partnership exist- when we have to have Shelly Dickstein duplicate the efforts inside city hall (as reported in today’s DDN)?
    Couldn’t the ambasadors be city employees?
    All this focus on the “6 square blocks” of Downtown is like thinking a boob job will change the world- this is a big city- with lots of opportunity for development- for building new homes, businesses- etc. We need to think “Greater Dayton” in many more ways- and stop duplicating efforts.
    We also need to work on that Perception/Reality thing a bit- I know just the right ad agency….

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  6. Bill Pote July 25, 2006 / 10:29 pm
    I’m aware of the Hutchins debacle at Eva Felman – they thought they had a “bigger and better” tenant that was to open a restaurant there until they figured out that because of the apartments above, the required kitchen ventilation would be too expensive. The new tenant passed on the deal and by then Boston’s and Sir Speedy were long gone. Yes, it was the new building owner that screwed that one up. But that corner is one of the most visible in the downtown core and its apparent abandoment makes Downtown Dayton look pathetic. No, the city is not responsible for finding a new tenant, but they can work with the property owners to find a solution.

    You are correct when talking about the zoning codes and liquor license issue. A friend of mine actually tried to buy the old furniture store on 5th and had plans to turn it into an artist gallery on the first floor with artist housing on the floors above (with his own money), but the deal fell through all because the city wouldn’t grant a parking variance. And of course, the parking requirement for that building is physically impossible, so maybe it will go vacant for another 30 years. This is also what I’m talking about when I say the city should help property owners fill vacant spaces. As for liquor licenses in the OD, you can blame the very tiny minority of small-minded residents that happen to also have the largest voices.

    I understand it is not the city’s responsibility to fill vacant spaces. Just as it is not the city’s responsibility to open a grocery store or do many of the things that so many people are “wanting the city to do”. The city can, however, help make the environment more desirable for business owners to open shop. Having seen an earlier post that displayed before and after pictures of a bridge, I have to say I’m disappointed that you were so negative with the things I had to say – the city can facilitate in helping (or forcing) property owners to improve their facades as well as improve public property. It is alot cheaper than building new buildings that we don’t need, or giving away tax credits to companies that may abandon us in the near future.

    The “6 square block” focus with me is obviously personal since it is where I both live in and own a business in. It is also the center of the city and where most of the money is made in this city, so yes – it is where a big focus should be. I also consider downtown to include alot more than 6 square blocks.

    The ambasador program is a private company that also operates in Indy, Louisville and Columbus – all cities that are considered successful. Do you really think the city could manage that as well as a private company? And at least we know our SID tax is being used for something. As for the DDP, I agree that there is a ridiculous amount of duplication when it comes to development organizations in this region (and city). I’m simply trying to be positive in the middle of too much negativity in this town. I hear alot of complaining in this city but not many people actually doing anything constructive to change things.

    Keep up the conversation – it is very valuable to get different opinions and even healthy debate. I just hope that you feel the same.

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  7. David Esrati July 26, 2006 / 12:02 am

    Hi Bill-
    all comments are welcome- as is debate.
    If you want to look for at the empty storefronts as pathetic- so be it-
    if the bureacracy is cut- and the prices fall low enough- people will find their way back.
    The salary of Maureen Pero alone- is enough to finance the Ambasadors program- so I’m a little mystified what she adds to the equation?
    It’s time for a war over the old Morris furniture building in the Oregon District-
    let people discover walking- you don’t have to have parking spaces within 500 feet- or even half a mile- if you have something successful (uh, why didn’t they require 3000 spaces for the Dragons ballpark?)
    It’s time for change- and hopefully- this site- and the readers- will all get motivated to make somethings happen.
    Thanks for your comments.

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  8. Phillip Ranly July 26, 2006 / 4:48 pm
    Wow, I’m loving this debate. I agree, a little marketing could go a long way. Changing the perceptions of local residents would be my number 1 priority though. I’m fairly young and I don’t know too many people that think that highly of where they live (one of my greatest peeves). Strangely enough though, there are plenty of people elsewhere that think of Dayton as hip and really like visiting. Slowly, I think the tides are turning. Frustrating attempts at urbanism like the Greene are good indicators that people want more than bland strip malls and sub-divisions. Neighborhoods just outside of the CBD are very encouraging too. The Fairgrounds, Oregon District (if you’ll allow me to consider it outside of the CBD), St. Anne’s Hill and Wright-Dunbar are all making progress or already very well established. I had dinner this past weekend at Coco’s and was totally amazed. The place was packed! I only got in because someone else was late for their reservation. Non-chain restaurants and shopping is becoming harder to find in the suburbs. People are making a shift, wanting to go somewhere that has a real sense of place. It could take time but I see things positively and going in the right direction. Something needs to counter balance the discouraging and unhelpful news that comes out of most of the media. Yes, a little marketing could go a long way.

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