Overview and Exploration of Regional Data. Session 1 Northeast Arkansas Economic Development Council November 29, 2017

Transcription

1 Overview and Exploration of Regional Data Session 1 Northeast Arkansas Economic Development Council November 29, 2017

2 The SET Process You are here

3 SET Purpose: Doing Better Together The regional team develops and implements a High Quality Regional Economic Development Plan that builds on the region s current and emerging economic strengths.

4 High Quality Plan: Essential Components Evidence-Based Practical Aligned with Goals Team s Regional Plan Broadly Supported Focused on Regional Economic Development

5 Today, We Will Review the Regional SET Forum Explore the regional economic data: Regional industry clusters Employment and occupation Chart the next steps

6 Guiding Principles for Our Discussions Sample ideas: Silence or turn off cell phones. Enter into the discussion enthusiastically. Give freely of your experience. Allow and encourage others to contribute. Listen attentively and take accurate notes. Ask questions when you don t understand. Appreciate the other person s point of view. Provide constructive feedback and receive it willingly. Keep confidences and assume others will. Confine your discussion to the topic.

7 Round I: Civic Forum Review

8 Civic Engagement Forum Review Regional Strengths & Challenges Data Snapshot Reactions Opportunities

9 Regional Strengths Good transportation access Expanding infrastructure location in U.S. Education good choices and quality (K-12 thru Higher Ed) Positive engagement between economic development players to grow regions good relationships Community involvement and leadership Leaders with great vision Good families strong work ethic High quality of life Healthcare/hospitals access, quality and affordability Cost of living and doing business Diverse economy existing industry and job opportunities Growing economy Quality of labor force Agriculture Wildlife, hunting and fishing Tourism

10 Regional Challenges (top votes) Workforce development/training Lack of willing workforce (variety of reasons society, culture, dependency, drugs, etc.) Lack of funding at local level for economic development/less state $ available for local government Changing perception of what a good job is and what s need to get those jobs Perception of region

11 Data Snapshot Reactions Civic Forum Notes (page 3) Civic Forum Data Snapshot & Supplement

12 Regional Opportunities Civic Forum Notes (pages 5-6) What potential opportunities stand out to you?

13 Round II: Economic Data

14 Business & Industry in the NEAEDC What are the most important businesses/industry in the region? Number of employees Growing

15 Business & Industry in the NEAEDC Groups 1 & 2 Data Scavenger Hunt Complete SET Data Scavenger Hunt worksheet # of employees Skills needed Type (see List of Clusters) Average earnings Size (L=100+ emps; S<100) County/Location Other businesses/industries for which it is providing support Groups 3 & 4 Data Mapping Write business/industry name in the center of flip chart List goods & services it purchases around name Put a star beside goods/ services available regionally On edges, add names of other regional businesses that connect to this one Draw arrows & add descriptions of connections such as purchases from, competes with, trains workforce for, etc.

16 Round III: Explain, Examine, and Explore Follow along using Regional Data Snapshot Industry Cluster Analysis SET Session 1

17 Industry & Occupation

18 Industry and occupation Components of changes in Jobs Changes in Jobs ( ) New Startups +29,339 Spinoffs +7,287 Gained by Expansion +16,509 In-migration +1,038 Closings -33,626 Lost by Contractions -14,407 Out-migration -1,100 Net change +5,040 How to Interpret this Table New Startups: A completely new business from births/openings without any affiliation to an existing business. Spinoffs: New businesses that were spun-off from existing businesses. Expansions: Existing businesses that have expanded in jobs. In-migration: Businesses that have moved-in from outside of the county. Closings: Closure of existing businesses. Contractions: Existing businesses that have shed/reduced jobs. Out-migration: Businesses that have moved-out from the county. Note: YourEconomy has changed its data source from NETS to InfoUSA on August, Based on the data available, we can only estimate churn based on jobs and not establishments. Source: Youreconomy.org database

19 Economy Company stages An establishment is a physical business location. Branches, standalones and headquarters are all considered types of establishments. Definition of Company Stages Establishment Distribution by Stages Arkansas, Selfemployed employees 500+ employees 2-9 employees employees Note: Based on Edward Lowe s research, Source: Youreconomy.org database

20 Industry and occupation Establishments Number of Establishments by Company Stages Stage Establishments Proportion Establishments Proportion Stage 0 1,367 15% 1,513 14% Stage 1 5,811 66% 7,497 69% Stage 2 1,551 17% 1,658 15% Stage % 123 1% Stage % % Total 8, % 10, % Questions: What stage businesses have shaped the region s economic growth in the last 6 years? Which ones are growing or declining the most? Which stage of establishments are likely to shape the region s future economic growth? Source: Youreconomy.org database

21 Industry and occupation Jobs and Sales Number of Jobs by Company Stages Year % Change Stage 0 1,367 1, % Stage 1 21,960 27, % Stage 2 38,666 39, % Stage 3 21,082 21, % Stage 4 12,795 9, % Total 95, , % Sales ($Billion, 2015) by Company Stages Year % Change Stage % Stage % Stage % Stage % Stage % Total % Questions What establishments are the most numerous based on company stages? What stages have experienced the largest growth? The greatest decline? What company stage employs the largest number of people? What stage captures the most sales? Which ones have experienced the greatest percentage loss over the period? Source: Youreconomy.org database

22 Industry and occupation Top ten industry sector employment growth NAICS Description 2009 Jobs 2015 Jobs Change Change (%) State Change (%) National Change (%)* 55 Management of Companies and Enterprises % 25% 18% 71 Arts, Entertainment, and Recreation 870 1, % 14% 12% 53 Real Estate and Rental and Leasing 3,155 3, % 4% 4% 72 Accommodation and Food Services 6,350 7, % 12% 16% 62 Health Care and Social Assistance 13,309 15, % 8% 15% 48 Transportation and Warehousing 3,070 3, % 6% 15% 61 Educational Services 1,292 1, % 19% 12% 44 Retail Trade 11,571 13, % 7% 7% 22 Utilities % 17% -1% 52 Finance and Insurance 3,083 3, % 3% 5% Questions: What regional industry sectors have seen the greatest growth? Did they grow at the same rate as the state? What factors are causing the growth? * Note: national changes are derived from Bureau Economic Analysis Data while state and regional values are derived from EMSI data. Sources: Full time and part time employees by industry; EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

23 Industry and occupation Four industry sector employment decline NAICS Description 2009 Jobs 2015 Jobs Change Change (%) State Change (%) National Change (%)* 51 Information % -13% -1% 56 Administrative and Support and Waste Management and Remediation Services 6,265 5, % 21% 22% 42 Wholesale Trade 3,487 3, % 2% 5% 90 Government 15,077 14, % -2% -2% Questions: How does the industry sector make-up of the region compare to the rest of the state? Which industry sectors are growing and declining the most in employment? * Note: national changes are derived from Bureau Economic Analysis Data while state and regional values are derived from EMSI data. Sources: Full time and part time employees by industry; EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

24 Exploring Industry Clusters

25 Industrial Clusters Clusters are groups of inter-related industries that drive wealth creation in a region, primarily through export of goods and services. Vertical Clusters Represents the entire value chain of a broadly defined industry from suppliers to end products. Examples: Auto manufacturing (glass, paint, engine, plastic, etc. that goes into making a car) Healthcare (service providers, equipment, medical supplies, pharmaceuticals) Horizontal Clusters Groups of similar industries that use the same resources including raw materials and/or labor Examples: Silicon Valley Wall Street Financial District Napa Valley Wine Region

26 Example of a Vertical Cluster: the California Wine Industry Suppliers Grape stock Fertilizer, pesticides, herbicides Grape harvesting equipment Irrigation technology California ag. cluster Tourism cluster Food & restaurant cluster Growers & vineyards Wineries & processing facilities Government Agencies Educational, research & trade organizations Suppliers Wine-making equipment Barrels, bottles, caps & corks Labels Public relations & advertising Specialized publications NOTE: adapted from Anatomy of the California Wine Cluster in Clusters and the New Economics of Competition by Michael E. Porter in the Harvard Business Review (1998).

27 Example of a Horizontal Cluster: the Silicon Valley Tech Industry Similar and Competing Businesses Shared Resources Workforce Knowledge Infrastructure Logistics Market

28 LIST OF CLUSTERS Advanced Materials Agribusiness, Food Processing & Technology Apparel & Textiles Arts, Entertainment, Recreation & Visitor Industries Biomedical/Biotechnical (Life Sciences) Business & Financial Services Chemicals Computer & Electronic Product Manufacturing Defense & Security Education & Knowledge Creation Electrical Equip, Appliance & Component Manufacturing Fabricated Metal Product Manufacturing Energy (Fossil & Renewable) Forest & Wood Products Glass & Ceramics Information Technology & Telecommunications Machinery Manufacturing Manufacturing Super-cluster Mining Primary Metal Manufacturing Printing & Publishing Transportation & Logistics Transportation Equipment Manufacturing

29 Industry cluster analysis How to interpret cluster data results The graph s four quadrants tell a different story for each cluster. Contains clusters that are more concentrated in the region but are declining (negative growth). These clusters typically fall into the lower quadrant as job losses cause a decline in concentration. Contains clusters that are under-represented in the region (low concentration) and are also losing jobs. Clusters in this region may indicate a gap in the workforce pipeline if local industries anticipate a future need. In general, clusters in this quadrant show a lack of competitiveness. Mature Top left (strong but declining) Transforming Bottom left (weak and declining) Stars Top right (strong and advancing) Emerging Bottom right (weak but advancing) Contains clusters that are more concentrated in the region and are growing. These clusters are strengths that help a region stand out from the competition. Small, high-growth clusters can be expected to become more dominant over time. Contains clusters that are under-represented in the region but are growing, often quickly. If growth trends continue, these clusters will eventually move into the top right quadrant. Clusters in this quadrant are considered emerging strengths for the region. Modified from:

30 Industry cluster analysis Mature Clusters Star Clusters Electrical Equip, App & Com Mfg. (3.55; 836) Glass & Ceramics (1.7; 297) Forest & Wood Products (1.14; 1,798) Fabricated Metal Product Mfg. (1.04; 883) Biomedical/Biotechnical (1.03; 8,538) Level of Specialization Transportation Equipment Mfg. (4.17; 3,919) Machinery Manufacturing (2.95; 2,002) Agribusiness, Food Processing & Tech (2.76; 8,703) Chemicals (1.89; 2,422) Mining (1.17; 373) Transportation & Logistics (1.02; 3,519) Percent Growth in Specialization Transforming Clusters Primary Metal Manufacturing (0.91; 209) Energy (Fossil & Renewable) (0.66; 3,845) IT & Telecommunications (0.57; 2,416) Defense & Security (0.48; 2,141) Printing & Publishing (0.44; 790) Business & Financial Services (0.43; 5,840) Apparel & Textiles (0.25; 196) Emerging Clusters Advanced Materials (0.97; 3,043) Education & Knowledge Creation (0.55; 1,375) Arts, Ent, Rec & Visitor Industries (0.46; 1,986) Computer & Electronic Product Mfg. (0.16; 99) NOTE: The first number after each cluster represents the number of total jobs (full and part time jobs by place of work) in that cluster in the region in The clusters are sorted in decreasing order by location quotient as shown in the bubble chart.

31 Bubble Chart: What to Look at First Quadrant Location Size of Location Quotient Percentage Change in Last 5 Years Number of Employees Start with clusters located in the STARS quadrant See if the MATURING clusters might have a good chance of growing again Determine if EMERGING clusters are likely to grow in strength Avoid clusters that are TRANSFORMING Focus on clusters with an LQ of 1.2 or higher Clusters with high LQs represent economic activities in which the region is competitive relative to the U.S. REMEMBER: Clusters only capture industries that have the likelihood of exporting goods and services. The horizontal line (the x- axis) shows the percentage growth or decline of a cluster over a five-year period. Make sure to examine the SIZE and DIRECTION of that change. Dramatic declines in a cluster with a an LQ of 1.2 or higher could be a difficult one to resurrect. The size of the bubble refers to the number of people employed in that cluster. It may be worthwhile to focus on clusters that are both competitive and that employ a good number of people.

32 Industry and occupation Industry cluster bubble chart Mature 4 Star Agri. & Food Process., 2.76, 8,703 3 Transportation & Logistics, 1.02, 3,519 Chemicals, 1.89, 2,422 IT & Telecomm., 0.57, 2,416 2 Glass & Ceramics, 1.70, 297 Energy, 0.66, 3,845 Forest & Wood Prod., 1.14, 1,798 Mining, 1.17, % -50% -40% -30% -20% -10% 0% 10% 20% 30% 40% LQ, 2015 Edu. & Knowledge, 0.55, 1,375 Printing & Publishing, 0.44, 790 Transforming 0 Advanced Materials, 0.97, 3,043 Apparel & Textiles, 0.25, 196 Arts & Ent., 0.46, 1,986 Defense & Security, 0.48, 2,141 Biomedical/Biotech, 1.03, 8,538 Business&FinancialService, 0.43, 5,840-1 Percent change in LQ, Emerging Note: Labels includes cluster name, LQ in 2015, and Employment in Source: EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

33 The Manufacturing Super-Cluster Please note that this is not a cluster that a SET region should select. Rather, focus on the manufacturing sub-clusters that are important to that super-cluster. Computer & Electronic Product Manufacturing Electric Equipment, Appliances & Component Manufacturing Manufacturing Super-Cluster Fabricated Metal Product Manufacturing Machinery Manufacturing Primary Metal Manufacturing Transportation Equipment Manufacturing

34 Industry and occupation Manufacturing sub-cluster bubble chart Mature Star Transforming Emerging Note: Labels includes cluster name, LQ in 2015, and Employment in Source: EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

35 Exploring Occupations

36 Industry and occupation Top five occupations in 2015 Questions: What are the education and skill requirements for these occupations? Do the emerging and star clusters align with the top occupations? What type salaries do these occupations typically provide? Source: EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

37 Industry and occupation Science, Technology, Engineering & Math Job change in STEM occupations NEAEDC, AR Rest of Arkansas 1,535 1, , , % Change 3.8% Questions: How do STEM jobs compare to the state? What has been the trend of STEM jobs over time? How important are STEM jobs to the region s Star and Emerging clusters? *Note: STEM and STEM-related occupation definitions from BLS (2010) Source: EMSI Class of Worker (QCEW, non-qcew, self-employed and extended proprietors)

38 Industry and occupation Science, Technology, Engineering & Math Texas 15.8% Oklahoma 24.4% Missouri 3.0% Arkansas 6.3% Louisiana 4.2% Mississippi -0.8% Tennessee 24.9% STEM Employment, 2009 to 2015 Regional Change 154,000 jobs or 13.8% National Change Percent Change in STEM Employment, 2009 to ,000 jobs or 10.5% -0.8% to 0% 0% to 6.3% 15.8% to 24.4% 24.4% to 24.9% *Note: STEM and STEM-related occupation definitions from BLS (2010) Source: Spotlight on Statistics, Bureau of Labor Statistics, U.S. Department of Labor

39 What are the region s unemployment trends? Snapshot, p. 17 Supplement, pp Are more people commuting into the region or commuting out? Snapshot, p. 19 How do regional earnings compare to the state or nation? Snapshot, p. 18 Supplement, pp. 17 Workforce Data

40 Cluster Analysis Dashboard

41 Honing in on Key Clusters Based on the assets of the region and current industrial trends What clusters should this region explore further? Resident s Values Industry Input Contribution by Counties Regional Competitiveness Key Clusters Export Value Number of Establishments Leakage

42 Reality Check and Next Steps Did the data reveal: Any new opportunities that should be considered? The need to eliminate previously considered opportunities? New partners that need to be included in the planning process.

43 Actions: Begin Writing the Plan Describe and summarize the Civic Engagement Forum process and results. Summarize key strengths and challenges based on the data Describe the selected clusters: Why were these clusters selected for further exploration? What are the strengths and challenges associated with the selected clusters? Which suggested opportunities are associated with each selected cluster?

44 Reflections

45 Stacey McCullough, University of Arkansas Cooperative Extension Service Phone: (501) Bryan Exum, USDA Rural Development Phone: ext. 4