The core of our 2018 Annual Conference was seven breakout sessions lead by Guild members focusing on that impact economic development. The discussions and presentations focused on the conference theme—disruptive technologies— and how each area might be impacted in the future by advancing tech. Below are the key takeaways from each breakout session.
Breakout Session 1: Labor & Talent
- Technology, business, and economic “disruption” is dramatically impacting the demand for, quality, and availability of skills.
- Proposed merit-based immigration could impact demand for and administration of government-sponsored training programs.
- Competition among locations is increasingly based not only on existing workforce availability, but on actively helping companies secure talent.
- The machines will rise but the impacts will be sectorally diverse, both negative and positive, spatially dispersed, and hard to predict.
Breakout Session 2: Economic Incentives
- Incentives in the Times of Tax Reform — the new tax law significantly reduces the ability of a corporation to exclude from its gross income grants received from federal, state, or local governments or civic groups to incentivize various corporate investments. Companies may consider altering their approaches to negotiating grant agreements.
- Incentives in the Times of Tax Reform — States may or may not conform to new federal rules regarding various tax reform items, including the treatment of incentives, accelerated expensing, or other business-related provisions. Over the next two years, each state will address this situation with a variety of likely outcomes. Watch closely!
- Incentives in Changing Economic Times — While companies continue to heavily invest in technological upgrades to their facilities to stay competitive on a global scale, many incentives programs reward job creation over capital investment. The lack of monetizable investment tax credits constitutes a major disconnect between public policy and corporate needs.
- Incentives in Changing Economic Times — While there are numerous incentives focusing on high-wage jobs, significant job creation is taking place for lower paid jobs, while these types of jobs provide significant economic impact in certain regions, companies often do not qualify for benefits due to wage thresholds associated with job creation. Reevaluation of job creation incentives may be prudent.
- Effective Communication Related to Incentive Programs — With a continuous need to differentiate themselves from competitors, economic development organizations need to ensure effective communication of their economic development strategy, economic incentives and flexibility in closing a deal.
Breakout Session 3: Transportation Logistics
- Increased port traffic due to larger ships being accommodated in causing increased real estate demand near ports, increased traffic on roads, and driving the need for inland ports to move traffic inland.
- Continued growth in E-commerce is driving changes in location decision-making priorities for logistics centers, especially around workforce dynamic.
- Changes in corporate supply changes and facilities being driven by next or same-day delivery models.
- Advances in technology and automation in vehicles are impacting the way goods are transported and delivered to customers.
- More frequent redesign of supply chain networks by companies to keep up with ever-changing customer demands and to maintain efficiency, cost, effectiveness, etc.
Breakout Session 4: Sites Development & Infrastructure
- Certified Sites: Create a competitive advantage in offering the very best “ready-to-go” sites.
- Sustainability Solutions: Consumer-facing companies are increasingly focused on sustainability issues, yet most areas cannot answer basic questions regarding local green initiatives/solutions.
- Active Industry- Food Industry Demands: understand the unique infrastructure demands of food plants (e.g., water and wastewater) from a quality standpoint as well as capacity.
- Permitting: Propose/recommend sites with detailed knowledge of all types and levels of required permitting processes.
- Capacity Planning: “Right time” for a community to secure additional acreage for future industrial growth is BEFORE you run out of sites.
Breakout Session 5: Energy
- The power consumption required by cryptocurrency mining is a potential disruptor and has further implications for economic development organizations and utilities, as the mining operations bring investment and nice-sized utility bills, but little economic spin-off impacts and significant environmental concerns.
- Use of lightweight materials such as carbon fiber will disrupt assembly processes for automobiles and boats and could disrupt entire industries, such as solar shingles, solar panels, solar car skins, etc. making them energy efficient while also making them stronger, durable and safer. While power walls are revolutionizing home electricity, other alternatives like Graphene super-capacitors will make battery technology cheaper and more available.
- The biggest energy disruption is the sale gas revolution and the impact on energy prices in the US. This has made the US competitive again in projects that haven’t been built in the US in more than half a century and now the US has a huge advantage for energy-intensive projects.
- Solar energy industry now employed more people in 2016-17 than the fossil fuel industry. 1/50 jobs are in solar energy. Tariffs could eliminate jobs but could also encourage the Chinese to produce panels in the US.
- Uneven geographic adoption of new technologies is creating regional pockets that in the long term will be less attractive to corporate investment. Distributed power generation could become more ubiquitous resulting in a post-grid energy economy that could make rural economic development easier and cost neutral. Power companies and fossil fuel producers will see their market shares decrease.
Breakout Session 6: Site Selection Process & Policy Impacts
- Despite popular belief, incentives are not the primary driver of public site selection projects.
- Advancements in geospatial software platforms are enabling rapid location screening and self-service data analytics.
- GIS, satellite imagery, street view, drones, and augmented reality are transforming field visits.
- Non-federal regulation of hiring practices and the workplace has become a patchwork of sometimes contradictory state and local laws.
- If possible, state and local taxes should be aligned with target industries to provide a competitive advantage.
Breakout Session 7: Global Topics
- Globalization, paradoxically, is leading the regionalization of investment as corporations react to geopolitical risks, economic nationalism and the restructuring of trade agreements in making their location decisions.
- Digitalization is changing the factors that drive corporate location decisions for both manufacturing and services with the availability and quality of talent and digital infrastructure now more important than sheer numbers of workers and labor cost.
- Locations that are able to effectively develop and grow pools of STEM talent will leap ahead, while those that can’t respond will fall even farther behind as competitive and attractive locations for investment.
- Labor market saturation is causing companies around the globe to take matters into their own hands to develop talent. Successful EDOS need to facilitate to help investors be successful and grow.
- Globalization has created new opportunities for investment and trade, but also exposed corporations to new types of risks that are leading them to rebalance their global expansion strategies
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