TIP Strategies is a privately held Austin-based economic development consulting firm committed to providing quality solutions for public and private‑sector clients.
This blog is dedicated to exploring new data and trends in economic development.
By: James Lawson
Via: Kenosha News
Companies that do not keep up with rapidly advancing technology can find themselves on the path to failure.
As a result, the communities in which they reside could be left with fewer jobs and an outward flow of skilled labor talent, according to Jon Roberts, keynote speaker at Wednesday’s Kenosha Area Business Alliance annual meeting.
Although Kenosha County’s population has grown since 2005, the income gap is widening because skilled talent is leaving the area for communities in other regions of the country, Roberts said told the more than 300 in attendance.
Roberts, a principal with TIP Strategies, an Austin, Texas-based consultant, said many of the people who have left the area over the past several years have not only moved to warmer climates, but to areas where advanced technology jobs are more readily available, such as southern California, Arizona, Texas and Florida.
Those who left the Badger State earned more than those who came into the state, he said. According to Internal Revenue Service statistics, the outbound income per capita was $21,100, and the inbound income per capita was $19,300 in 2010.
Roberts’ firm was hired in 2008 to assist in developing an economic development strategy plan for Kenosha County.
The plan, “Kenosha First: An Economic Development Strategy for Kenosha County: The Next Phase” incorporated input and ideas from various parties throughout the county. It was a response to KABA’s desire to learn how public and private entities could help stimulate private investment and employment.
A TIP study revealed that Kenosha County has a high concentration of manufacturing, retail trade, corporate management, administrative and waste services, educational services, health care and social assistance industries. It also has a high concentration of accommodation, food services and pubic administration jobs.
Meanwhile, Kenosha County has a low concentration of professional and technical services, finance and insurance, transportation and information services jobs.
He said that nationally, manufacturing jobs have dropped from 26 percent to 9 percent over the past 30 years.
Technology is changing so fasted, Roberts said communities that want to diversify and maintain a steady, balanced economy have to attract other types of companies to retain and attract talented employees.
Disruptive technology, rapid industry and product changes that render some products and processes obsolete can have a negative impact.
“It can affect the supply chain, social norms and the labor pool,” he said. “In the supply chain, entire business units cease to exist, and secondary providers disappear.”
He related how many watch manufacturers went out of business when the digital watch come onto the market.
All of the old technology behind the traditional watch would not suffice anymore.
Meanwhile, one company, Omega, created a niche.
Social norms can change, he said. “There’s culture shock around traditional behavior and trusted institutions.”
He gave an example of how when he was a young man, he treasured his ’65 Mustang. “Today, kids don’t care about cars like that.”
The labor pool changes because there can be a “massive disruption in the number of workers and skill sets they require,” he said.
He asked, “What does disruption mean for economic development? If productivity doesn’t bring job gains, what are we incentivizing?”
What’s next for Kenosha?
Roberts suggested a rethinking of economic development.
That means creating a brand for Kenosha by linking place to talent and innovation, creating a culture of change, embracing technology, rethinking entrepreneurship and improving urban linkages.