Roadmap for a new economy : the drive for prosperity

20 Pages·2003·0.7 MB·English

by  Montana. Governor's Office of Economic Opportunity

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330.9786
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Glrne
2003
The Governor's Office ofEconomic Opportunity
BOIIDHBP FOB HEUI EClOIIY
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The for Prosperity.
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MONTANA STATE LIBRARY
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MONTANASTATELIBRARY
MONTANASTATELIBRARY
MBus®inNessTANA 3 0864 1001 8323 8
Letter From The Gouernor
Economic development is consistently listed as the top issue on the minds
ofMontanans, and it is the cornerstone ofour administration's initiatives. Those
ofus who have the opportunity to call this beautiful state home know firsthand
the challenges and opportunities that businesses face on a daily basis. We
cannot take our economy for granted. A vibrant economy, made up ofstrong
businesses, lends itselfto healthy communities and a high quality oflife.
In the following pages, you will find a process - a roadmap for economic
development - that has been developed by our administration's Governor's
Office of Economic Opportunity in collaboration with local economic develop-
ment groups, businesses and the university system, among others. This is more
thanjust a roadmap for economic development, however, it is a challenge to
create a new and better Montana. It is a guide to economic expansion. It is a
platform for creative ideas. Above all else, it is a tool by which our progress
toward long term goals will be managed, monitored and evaluated.
We are pleased to present this document to the people of Montana.
Working together with all stakeholders, 1 am confident that we will create an
economy to match our unparalleled way of life.
Sincerely,
\<\^£^
JUDY MARTZ
Governor
Gouernor'sOfficeofEconomicOpportunity
MBus®inNessTANA
Chief Business Officer's Deport
ASpecialReportfromtheGovernor'sOfficeofEconomicOpportunity
For the past 60 years Montana's prosperity, relative to the other states
in the union, has been steadily declining. Certainly there have been periods of
short-term improvement, but those instances have proved fleeting and the
long-term trend has been unmistakably downward. So why has this occurred?
Growth by itselfhas not been the problem. In the past 20 years,
Montana's Gross State Product has increased more than 300%. At the same
time, our per capita income has declined from a rank of 33 to 47 among the
other states. It is the type ofgrowth that has fueled our decline. Montana
continues to grow fastest in jobs requiring lower worker skill levels that have
correspondingly lower wages. This shift to lower payingjobs has had an
unmistakable effect on our ability to provide good payingjobs for Montanans.
To affect long-term improvements in our economy, we will have to make
some fundamental changes in the way we attract and retain businesses and
createjobs. We must also be realistic about the time it will take to affect these
changes. In the ten-year period between 1990-2000, the three states that most
improved their per capita income did so by increasing their rank an average of
"Montana'seconomicfutureisimportanttousall. Wehave
hadmanyrequests,fromaroundthestate,tokeeppeople
informedabouttheoffice'sactivities. Thisreportwillhelp
uscommunicateourinitiativesandwhatwearedoingona
yearlybasis. Ifyouwouldliketotalkwithusinperson,
pleasecallusorsendusanemail."
—
^DavidGibson
ChiefBusinessOfficer
>
9 spots among the states. These are "best in class" results. For Montana to
have achieved this level ofperformance, we would have to have seen our per
capita income increase an additional $2,000 in the previous decade-about
8.5% higher than what Montana actually did achieve.
One way to look at the magnitude of this task is to determine how many
jobs we would have had to create in the past decade to achieve this "best in
class" increase in per capita income.
"To affect long-term In fact, it would have taken about
improvements in 50,000 newjobs, each paying at least
our economy, we $40,000 per year, to have the necessary
have make impact.
will to
some fundam.ental To accomplish this magnitude of
changes in the way improvement in the next decade we will
we attract and have to focus on objectives that go
beyondjust trying to createjobs directly.
retain businesses
We need to identify the types ofcompa-
and create jobs."
nies andjobs that, when created, rever-
berate through the economy and have a dramatic, synergistic effect on creating
other companies andjobs. Beyond the important work ofdirectly trying to
attract and grow the right type of "high leverage" jobs, we must also identify
those factors such as research and education that indirectly fuel significant
wage growth over time. This takes a focused, coordinated strategy. Without
such a strategy to focus all our efforts, we cannot hope to reach the level of
economic prosperity our citizens deserve.
MBus®inNessTANA
IntToductJOT)
Any iuccedd^ul itrategic plannins e^^ort requira a procedd to both reicarch
alternatived and get the involvement oj important individuali and si'oupi that will be
needed to implement the plan. /|s the proce&& id too abbreviated, and key con&tituent&
are not adequately involved, then the plan will &urely Jail, no matterhow well
written. A planning proce&d that i6 too long, however can take on a iif)e oj iti own.
become too complicated and lose ^ocu6 on the critical ^ew initiativa that will guide
the overall e^^ortd. To ^ulpll ourlegiilative mandate ad outlined in MCA g-i-112 the
Governor'A O^^ice oj economic Opportunity had developed a proce&& that we believe
balanced dpeed. thoughtful redcarch and the involvement 0^ ad many condtituent
groupd ad poddible. The following document id the culmination oj ^ive-dtage proce&d.
1. Reiearch and CompetitiveAisesiment
Understandingourstate'seconomy is crucial toa well thought-outstrategy. Our
team performed an assessment, utilizingquantitativeand qualitativedata, ofthe Montana
economy. We reviewed Montana's previous strategic plans and the plans ofothercities
andstatesaround thecountryto identifybest practices. Montana was benchmarked
againstotherstatesand a comparison ofstateeconomic indicators was completed, in
addition, meetingsand discussionswereheldwithstakeholders from across thestate to
gain their insight into Montana'seconomy.
2. Creation ojjtheFramework foreconomicDevelopment
Thisdocument, published inJanuary, served totarget theeconomicdevelopment
discussion and stimulate more focused ideas from stakeholdersacross thestate.
3- CcUabcraticn & Outreach, to Stakeholders
Inaneffort to understand themost important issues facingthestate'seconomyand
prioritize the initiatives toaddress them, the Governor's OfficeofEconomic Opportunity
soughtadditional input from stakeholdersaround thestate. Broad spectrums ofstakehold-
ers, includingthe privateand nonprofitsectorsand all levelsofthepublicsector, havebeen
engaged in theplanningprocess. Inaddition tohundredsofinformal meetings, weheld 15
formal listeningsessionsaround thestateto besurewereceived general public input. The
governoralso formed an advisorycouncil tohelpguideouroverall processand decision-
makingduringdevelopment and implementation ofthe plan.
4. Interim Status Report
Thisdocumentwasan interimstatusreportandhighlightedtheGovernor'sOfficeof
EconomicOpportunity'sprogress todate, current focusareas, andnextstepsforthe2002
Special Session.
5. Strategic Plan Development
This document is a roadmap forthestate'seconomicdevelopmentefforts over the
next5to 10years. Itcontains new ideasgenerated through collaborationand input from
stakeholders inaddition tomanyofthe strategies and goals put forth in the Framework for
Economic Development.
i:0EJ/11
InitJatiues
Focusing our Resources
InordertoJociwourscarce Finally,weidentifyinadequate Priorities
reicurcei, wemustdevelopa linkagesincurrentorpotentialclusters Determinethecompetitiveadvantages
stratesycenteredonMontana's ofMontana'seconomicregions.
existingandemergingindustry anddevelopamethodologybywhichall
clusters. Wemusttirstclearly Montanacommunitiescanperformmicro- Identifytraded(primary)sectorswith
identitytheseeconomicclusters levelclusteranalysisandidentifypromis- ahighpotentialforgrowthand
andthenconcentrateongrowing ingentrepreneurswithinthoseclusters. entrepreneurialactivity.
theseinterrelatedgroupsofcom-
panies. Thiswillrequirethatwe
begintotocusourothersupport-
ingprograms(financial,
work'iorce, regulatory, technical
support, etc.)ongrowingthese
clusters.
WhyClusters?
Clustersaregeographicallyclose
groupsofinterconnectedcompaniesand
associatedinstitutionsinaparticularfield,
linkedbycommontechnologiesandwork-
erskills. Inastatewithlimitedresources,
wemustfocusthoseresourcestoattain
world-classtechnologyandworkerskill
training Theclusterinitiativewillalign
withthenatureofcompetitionandthe
sourcesofcompetitiveadvantageand CurrentStatus Establishamethodologyforall
captureimportantlinkagesandspillovers Montanacommunitiestoperform
oftechnology,skillsandinformationthat Montanahasengaged,througha community-levelanalysisandidentify
cutacrossfirmsandindustries. competitivebidprocess,theservicesof promisingbusinessdevelopment
RegionalTechnologyStrategies,Inc.(RTS) strategies.
WhatWillACluster toperformtheMontanaClusterStudy,
InitiativeAccomplish? RTShasaknowledgeablemanagement Createablueprintforimplementing
teamthatishighlyexperiencedinhow clusterbasedgrowthstrategiesand
clusterdevelopmentstrategiescanbe
OurClusterInitiativeanalyzes beginimplementation.
successfulinruralareas. Thestudyiscur-
Montana'seconomicregionstoidentify rentlyinprogressandwillbecompleted
anddocumenteacharea'scompetitive inJanuary2003. Oncecompletedwewill EnsurethereisanonlineBusiness
advantages. begintointegratetheresultswithour NetworkforallMontanacompanies
Wealsoidentifyestablishedsectors RecruitmentInitiativeinaconcurrent toincreasebusmess-to-business
ofhighconcentrationaswellasemerging process Awell-developedclusteranaly- transactionswithinthestate.
industrieswithahighpotentialforentre- siswillalsoallowustofocusourother
preneurialactivity. effortsthroughoutthestate.
Gouemor'sOfficeofEconomicOpportunity Benchmarksm¥
Initiatiue Benchmarks
Goal:EstablishednetworksofgrowingbusinessesinidentifiedindustryclustersthatallowMontanatofocusourlimitedresourceson
attainingworld-classtechnology,workerskilltraining,andpromotionactivities
CurrentStatus Goal
2003 2007
Numberofclusterorganizationformed
InJtJatiues
A Workforce for the 21st Century
Tlieavailabilityctaikilled globalcompetitivenessensurethat,over theUniversitySystemtoimprovetheway
wcrktcrcehasbecomeonectthe thelongterm,wageswillreflectthetrue our2-yearcollegesdeliverworker-
matimportantiisueitor valueofthelaborperformed. Thisiscom- trainingandlife-longlearning. Wemust
attractingand retainins monlyknownasproductivity. alsoensuretrainingisavailablethrough-
buiineaeithatprovidehigher Thereareonlytwowaystoimprove outthestate. Thisiswhywemustcontin-
payingjcbi. Workforceikilllevel productivity: increaseworkerskilllevels uetoencouragebetterandmoreversatile
iia keydriverotinnovationand and/orincreasetheuseoftechnologyin distancelearningprograms.
productivityimprovementacroa theworkplace. Thisinitiativeaddresses Finally,wehavegivenapriorityto
allindustriei. Thesucceaot theformer-theneedtoprovideourciti- creatingbetterworker-trainingfundsfor
Montana'seconomydependson zenswiththetrainingtobemoreproduc- businessesinthestate. Thisisacritical
ourabilitytocontinuouslyraise tiveintheworkplaceandultimatelycom- needbothforencouragingourcompanies
theskilllevelotourworkers. mandhigherwages. toimprovetheiremployee'sskilllevels
Itoureducationandworktorce andforanincentivetobusinesseswant-
trainingprogramsarenottully ingtoexpandorrelocateinthestate
responsivetotherapidly Worker-trainingassistancehas
changingneedsotMontana becomethemostimportanttoolfor
businesses, wecannothopeto attractingnewbusinessesandgrowing
retainourcitizensorgrowcur jobs,butMontana'sprogramsarestill
averageincomelevels. heavilyfocusedon"bricksandmortar"
insteadofourhumancapital.
WhyWorkforce?
Priorities
Montana'ssuccessindiversifyingits
economywilllargelydependonthepres- • Createmoreincumbentworker-
enceofahighlymotivated,strategically trainingfundstosupportbusiness
educatedworkforcewithahighlydevel- retention,attractionandgrowth. Our
opedcapacityforcriticalandinnovative toppriorityistoallowtaxincrement
thinking. financingofworkertraininginnewly
Companiescurrentlylookingto createdjobsinthestate(similarto
expandorlocateinMontanamusthave CurrentStatus NorthDakotaandIowaprograms).
accesstoahighlyqualifiedworkforce. • Improvethe2-yeareducationsystem
Withastatewideunemploymentrate Earlyinourtenureweidentifiedthat tomakeitmoreresponsivetothe
hoveringaroundhistoriclows,worker criticaldataaboutourlevelofunderem- needsofMontana'sworkersand
availabilityisaseriousconcerntomany ploymentdidnotexist. Inpartnership businessesandalignedwiththe
neworexpandingbusinesses. withtheDepartmentofLaborwecommis- specializedneedsofourindustryclusters.
sionedastudythathasjustbeencomplet- • Greatlyexpandthedistancelearning
WhatWillAWorkforce ed. Wecannowdemonstratetonewor programsofferedbytheMontana
InitiativeAccomplish? expandingbusinesseswhatthetrue UniversitySystem.
natureoftheworkforceisforevery
Inaglobaleconomy,higherwages regionofthisstate
canonlybesustainedifthevalueofa Wearealsoworkingwiththe
personsworkisincreased. Theforcesof CommissionerofHigherEducationand
Gouemor'sOfficeofEconomicOpportunity Benchmarks»»
Benchmdrks
iTiitiatJue
Goal:Ahighlymotivated,strategicallyeducatedMontanaworkforcecapableofcommandinghigherwagesandofsupplyingtheneeds
ofourexpandingindustryclusters.
CurrentStatus Goal