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Power From the Middle

October 15th, 2012 by Kenny McDonald

We’re pretty big on things in the middle, the Middle West, the middle of Ohio, etc.  On October 23rd and 24th, the National Center for the Middle Market and its collaborative partners The Ohio State University’s Fisher College of Business and GE Capital will hold their annual summit here in Columbus.  Here are some facts about middle-sized companies in the Columbus Region (companies with revenues more than $10 million/yr., and $1 Billion/yr.).

  • The Columbus Region has 56,996 private sector establishments, of which 1,313 (2.3 percent) have middle market (between $10M and $1B) annual revenue/sales (and are not branches of $1B-plus businesses).
  • Businesses in key economic sectors (logistics, manufacturing, science and technology, agribusiness, HQ and business services) comprise 18 percent of all private sector establishments in the Region. Among middle market establishments, they comprise 57 percent, a share more than three times higher.
  • Logistics and manufacturing in particular have greater shares of the middle market. Thirty percent of middle market establishments are logistics, compared to just 7 percent of all establishments. Seventeen percent of middle market establishments are manufacturing, compared to 4 percent of all establishments.
  • The 1,313 companies employ 127,507 people in the Region, or 15.4 percent of overall private sector employment.
  • Middle market manufacturers comprise 30 percent of the Region’s manufacturing employment. Middle market logistics firms comprise 24 percent of the Region’s logistics employment.

Columbus 2020 Update
The Columbus 2020 team has arrived and is executing on its mission to Japan with help of some of our public and private partners.  Our team has also joined JobsOhio and many of our partners from Ohio at the International Asset Management Council’s meeting in Omaha, NE.  Finally, our team will be in Washington D.C. this week with the Brookings Institute launching its metropolitan export strategy with several other areas.

Let’s have a great week!
-Kenny McDonald

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Smashing through the ceiling

October 9th, 2012 by Kenny McDonald

“The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.”
-Winston Churchill

There is a growing belief that economic growth may cease to exist.  Martin Wolf’s post in the Financial Times is the most recent article questioning the premise that the global economy will continue to expand.  There are compelling arguments for this theory that cite historical periods when the world seems to stand still and point to the natural limits of technology and ecology.  We have all seen growing communities and growing companies that seemed limitless stall – so this theory seems reasonably plausible.

However, whenever things appear inevitable is just about the time that change dramatically occurs.  Just when that cash cow seems depleted, or an industry or technology seems like it could not be improved is when we smash through the ceiling and never look back.  Let me cite a few examples;

  • The United States of America spends over $40 billion on coffee annually.  Remember the world before Starbucks coffee shops, and Keurig machines?
  • The grocery store of our youth no longer exists, with more change on the way. Innovation in food technology, security, and packaging has totally transformed the mundane corner store.
  • The smartphone (Blackberry, Android, iPhone)… need I say more?
  • As Richard Florida said in his presentation to Innovate Columbus last week – more urban space will be built in the next 50 years than in the history of the world.  What innovations will that drive in construction, architecture, and transportation systems?

I am certainly not sure what the next breakthroughs will be that drive growth, but I do have confidence that right now the economic sands of entire sectors of our economy are shifting beneath our feet.  Some of the changes are sudden, more often than not they are gradual, and nearly all fuel economic growth in directly and indirectly.

Columbus 2020 Update
As referenced in Economic Development Matters last week, the IdUS events were all wonderful for our region.  The 2020 team held meetings in Houston and Atlanta and we are focused on several upcoming missions.  The team leaves for Japan this Friday for a week of meetings with companies.

Thank you to Mark Kvamme for his many contributions to Ohio’s economic development community.  We would like to personally thank Mark for his time, effort, and business insight which has shaped JobsOhio 1.0.  He has helped Ohio attract and retain jobs, and I look forward to working with him in the future.  We are excited to do the same with John Minor, who has been named to Chief Investment Officer at JobsOhio.

-Kenny McDonald

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Small Pieces – Loosely Joined

April 30th, 2012 by Kenny McDonald

I recently attended a presentation at MIT where a technologist suggested a book called Small Pieces Loosely Joined by David Weinberger. At once, I knew I had to get this book. The title alone is worthy of my attention as a regional economic development practitioner. In fact, the phrase “small pieces loosely joined” sums up my feelings about how regionalism works very well.

Just like the web, regional collaboration changes our perception about what is possible, imperfect, and ever evolving. I’ve always believed regionalism requires that the small pieces (locally this means counties, cities, townships, villages) work hard to develop and maintain their history and character to reach their full potential. Occasionally, and increasingly more often as budgets tighten, the small pieces can only achieve their full potential by banding together in whole or in part with other areas to achieve this potential (regionalism).

In fact, it is a pretty apt description of the United States. Each state brings unique attributes to the table, each ruggedly individualistic, but occasionally and for certain functions these states band together in small groups (Midwest, Southeast, New England) or as a whole (national defense). It is a basic premise of America. Go it alone, take care of yourself, compete – and come together when/if necessary.

The Columbus Region is working very hard to do just this, and Ohio in a larger sense is doing the same thing through the JobsOhio Network – a collection of 6 regions throughout the state that have banded together to market/promote and conduct economic development for the benefit of the State of Ohio. Together we can do more than has ever been done before in Ohio, but our coalition and our economic development system will always be imperfect and ever-evolving. Small pieces – loosely joined.

Columbus 2020 Update
Columbus 2020 received an honorable mention as one of the top economic development groups in the country last week through Site Selection magazine. Congratulations to the great team, but, more importantly to our regional partners (200+ private sector companies and 26 public entities that make up our investors). You made this advancement possible and we appreciate it.

Last week our team visited the Hannover Trade Fair in Germany and the Industrial Asset Management Council’s spring event in Texas. More prospects were developed at both events and our team keeps pushing forward this week with another trip to Texas to meet with energy companies at the Offshore Technology Conference in Houston. Wish us luck!

This Wednesday the Brookings Institution, in a joint project with JPMorgan Chase, will host the Ohio Global Cities forum at The Ohio State University. The forum will explore how Ohio’s metropolitan areas can enhance their ability to compete globally by focusing on the interplay between advanced research, advanced industries, skilled workers, foreign direct investment and sophisticated export promotion and finance. You can register and learn more about this event here.

-Kenny McDonald

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