Washington is paralyzed by politics and debt, but states and regions are moving to renew the drifting U.S. economy themselves. In just the last year no less than three states — Colorado, New York, and Tennessee — have begun to execute well-considered “bottom-up” development strategies that aim to restore growth and place regions at the center of economic development planning and execution.
Now comes Nevada, arguably the state most damaged by the recent real estate and consumption sector crackup, with its own effort at renewal.
Having lost 170,000 jobs in the recession (including 120,000 in real estate, construction, food and drink, and tourism), the Silver State yesterday issued a well-considered new plan for generating 50,000 new jobs by reshaping its economic development activities and diversifying a damaged gaming, tourism, and real-estate-oriented economy.
The plan represents a key step in a serious effort to place a troubled economy on a better footing.
Mandated by a bipartisan order of the Nevada Legislature and announced by Gov. Brian Sandoval (R), Nevada’s new blueprint reflects a year-long push by a troubled state not just to react to crisis but to truly reposition itself amid shifting realities.
Along those lines, the new document draws on a recent Brookings report to the state, provided in partnership with SRI International and Brookings Mountain West, and targets seven industries for growth and innovation; announces the outlines of a new “operating system” for state-regional cooperation on execution; and then sets a strategy for establishing a sound platform for innovation and export-oriented sector development.
Embedded in the plan are numerous concepts relevant to the pace and nature of 21st century economic development in which strategy, networks, innovation, and the ability to catalyze coordinated action across myriad actors count for everything. They state will henceforth operate with a fact-based strategy. It will now manage itself and its partners through data and metrics that matter. And it will hire and embed a set of new “industry specialists” to work with the state’s sectors and clusters and facilitate growth.
And yet, what is most compelling here is the fact of a state that didn’t think it needed a plan for fostering high-value growth not only advancing one, but focusing hard on the power of regional economies and industry clusters to deliver it. For decades, massive growth in Nevada’s real estate and gaming industries stunted efforts develop a serious economic development strategy and practice. As a result, Nevada entered the Great Recession with one of the weakest, most diffuse state and regional economic development systems in the nation. Yet now that Nevada has been hammered by the crash it is fascinating to watch it go about the work of seeking advice and constructing a data-driven, intentional, best-practice-oriented diversification strategy where little existed before.
It is equally impressive to note the strong orientation to “bottom-up” strategies for rebuilding the state economy on the part of the Nevadans. Nevada leaders — like those in more and more states — seem to have realized that the state’s regional economies (in Reno, in Las Vegas) aren’t just parts of the Nevada economy but are the state economy. And so the state plan calls for a simultaneously “loose” and “tight” set of relationships between the state and its regional partners through which the state will work to evoke and support smart local initiatives. Starting now the state will ask more of the state’s regional development authorities and manage for results. It will improve the range of economic development information available to regional actors. It will encourage regional strategy-setting. And it will create a set of competitive grants, innovation prizes, and competitions to incite creative cluster and export initiatives in the regions.
In short, while managing more robustly from the center, the new governor’s Office of Economic Development will also honor, aid, and abet the profound differences that exist across regional economies. Now to be sure, plenty of questions remain. How well the state will be able to execute its new strategies is surely one of them. Likewise, another question — and a crucial one — concerns whether a conservative governor and a revenue-strapped legislature will find the will during the 2013 legislative session to make the investments in university research and knowledge transfer, workforce training, and basic education urged by our report. Those were unfortunately not mentioned in the new state plan.
And yet for all of that, it is good to see another state recognizing the centrality of its regions and conducting strategy accordingly. It bodes well that “bottom up” is becoming the top new approach in state economic development.
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[Colorado] is entering a period where it has an opportunity to be the Silicon Valley of space.