|Northern Kentucky economic leaders discuss why 1 in 3 jobs have been going to Texas/Provided|
Economic and business leaders from Cincinnati and Northern Kentucky came together to try to answer the question on economic developers’ minds all across the nation: What’s up with Texas?
As part of Northern Kentucky Forum’s final event of their 2014 season, a panel of experts met at the NKU METS Center in Erlanger to discuss what exactly has taken one in three new jobs to the Lone Star State in recent years.
To kick off the conversation, moderator and Government and Community Relations officer for Duke Energy, Rhonda Whitaker, took the panel and the audience through a survey conducted by Northern Kentucky Forum, polling local business owners and professionals on the issues that surrounded their decision whether to open up shop in Greater Cincinnati. The survey asked questions like why a business decides to locate in a particular region, how to retain jobs in Northern Kentucky, and what other regions Northern Kentucky is currently competing against for those jobs.
Across the board, respondents pointed to tax code and policies as the chief factor in both bringing and keeping jobs in Northern Kentucky.
Dan Tobergte, president and CEO of Northern Kentucky Tri-Ed, a regional economic and business development venture, agrees. “Tax policy is key,” he said during the discussion, also pointing out Tri-Ed’s vocal support of a local option sales tax across the region.
A local option sales tax would allow local governments to propose funding for economic development projects via a direct-to-voters ballot measure, without requiring an amendment to state-level tax code, effectively putting more muscle behind projects backed by local leaders.
Tobergte also mentioned that Kentucky ranks 27th in the nation in tax attractiveness to business owners.
But as the discussion progressed, it became clear there is much more to stimulating a regional economy than tax policy initiatives.
Janet Harrah, a senior director at the Center for Economic Analysis and Development, said Texas’s success is about more than just creating new jobs. While a staggering 18% of US GDP growth over the last year has come out of Texas, it has also grown its population by over 4 million people in the last 10 years.
Beyond population and job growth, Harrah said, Texas has also been able to establish an increase in household income levels that supports the other sectors of growth.
“Adding a lot of low-income jobs to a state can actually drain that state’s economic development,” she said. “Growth itself isn’t necessarily great without the income growth to sustain it."
Because of this, Harrah was able to point out discrepancies in income levels and quality of life that still exist within the state of Texas. “Yes, Texas is doing extremely well, but it’s still a sort of has and has nots within the state,” she said.
From this, Harrah concluded — and her fellow panelists would later chime in to agree — it is more beneficial to think about these issues on a metropolitan scale, rather than on a state-level.
For James McGraw, president and CEO of KMK Consulting, a region’s public assets are just as important as financial incentives, as well as how they can appeal to corporations looking for a new headquarter location. Cincinnati is already home to a number of national corporate headquarters, including Kroger and Proctor & Gamble.
“If we pay attention to making sure we have the best set of assets focused around talent, quality of place and life, and balance with policies that are as favorable as we can, we will win more than our fair share (of business deals),” McGraw said.
At the center of those public assets, for McGraw, are those that make Cincinnati and Northern Kentucky a desirable place to live. “These companies,” — that is, companies considering Greater Cincinnati for location — "care more about urban livability and talent acquisition and retention than anything else. They want to have a place where they can attract young talent from around the world to live here,” he said.
Developing its urban core is the most important thing our region is doing, McGraw said, pointing to Dallas-Fort Worth and Houston as the two cities in Texas really capitalizing on this reality.
Among the many public assets McGraw listed throughout the discussion, DHL’s Hebron facility and the University of Cincinnati, along with NKU’s new School of Informatics topped the list.
Harrah agreed, adding, “The more we can engage (students) in the business community while they are in school, the more we will retain them (after graduation day)."
McGraw also pointed to Cincinnati Children’s Hospital as “undersold and under-marketed” by economic developers trying to bring new business to the region. “This is such a fabulous place to raise a family,” he said.
“The problem is,” he continued, slightly complicating his initial comments about promoting a region’s assets, “as a distinguishing characteristic, 250 other markets think the same thing. It’s not unique enough."
The key then, for McGraw, comes down to realizing one very basic fact: “We’re not going to be Texas. We shouldn’t try to be. We’re in a different world than that."
By this, McGraw was pointing back to the initial statistics Harrah outlined about the massive growth in population and GDP measured out of Texas over the last year. As a region, Greater Cincinnati cannot hope to compare to that sort of scale.
Instead, for McGraw, it is less about imitating Texas as it is thinking smart, as leaders there have. “We need to be as realistic as we can, and pick our fights properly,” he said. "We have three different states to sell from (in the Tri-State), and three different sets of assets. This is an opportunity."
- via Northern Kentucky Forum