Economic development was born in the industrial age. Hydro companies were the first players in the investment attraction business around the early 20th century. Industrial development was the term of the day. They were looking for heavy industrial electricity users to sell the electricity to – makes sense.
Following on the success of industrial development by electricity companies, governments got into the game. When they attracted an industry it was like hitting a home run and sometimes a grand slam in terms of jobs, tax base and community economic growth.
This is where and when smokestack chasing was in it’s heyday and it worked because we were still in the growth phase of the industrial revolution. The industrial age peaked in the 50’s and first major fall out was felt during the oil crisis of the 70’s. This was at the dawn of the new economy which is more knowledge, innovation and creative worker based and in many cases made up of smaller enterprises although in the case of Google and RIM not always.
I’ve been in the rural economic development game and attending Economic Developer conferences for 9 years now. I could never understand why there was all this emphasis on industrial attraction when it was quite obvious that this was a dwindling and diminishing opportunity – where only a very few home runs and grand slams are available and mostly strikeouts arise out of attraction effort. I observed few winners and many losers with this focus. For every corporate relocation thousands of communities are swimming with the sharks to try and win the industrial attraction lottery. Good luck!
Meanwhile small businesses, entrepreneurial, knowledge based, innovative and creative economy opportunities are growing by leaps and bounds, with lots of singles, doubles and triples to be had day in and day out in the investment attraction and expansion game.
Over the years I have watched the emphasis diminish on industrial attraction, site selectors and international conglomerates attraction initiatives. I watched as things like retention and expansion of local business, small business, tourism, cultural development and quality of place, etc… was emphasized.
February 2010 for me marked a turning point. At the 2010 Economic Developers Conference of Ontario, there was little or no discussion on industrial investment attraction, site selectors and site selection criteria. Instead the focus was on the “New Economy”, it focused on the knowledge, innovation and creative economy and focused on social media as an economic development tool. This had been brewing for a few years, but I believe do to the economic realties the organizers made a conscious decision to focus on singles, doubles and triples success opportunities.
I believe 2010 is the turning point as the profession aligns, stakeholders and key decision makers will continue to align to the new realities of economic development. The new realities do not discount industrial attraction, but put it into perspective as merely one part of the mix. In any winning baseball game, you need singles doubles and triples to score, minimize your strike outs and take home runs and grand slams as bonuses as a game well played.
Any thoughts on this topic or perspective?