Youngstown Immigrant Innovation

Update: Youngstown Pride points to a New York Times article about immigrants revitalizing a struggling Buffalo neighborhood.

Richard Herman passed along to me a link to an op-ed in the Cleveland Plain Dealer about the weak investment in the Fund for Our Economic Future. The Cleveland Foundation's hasty retreat is a mystery. Is the Fund not Cleveland-centric enough? One critique of the Fund, found in the op-ed, is a lack of leadership on the immigration front.

The Youngstown/Warren Regional Chamber should keep that in mind as it campaigns for a renewal of the Ohio Third Frontier program. Anything good can always be better:

Regional groups have told [Richard Herman] ''internationalization was not a top priority,'' he said. ''Immigration is kind of a dirty word here, and organizations don't want to use it.''

For instance, until a year ago, an Ohio Third Frontier-funded program for interns specifically excluded those who weren't citizens from participating.

''That was a bright sign saying, if you're an immigrant, don't come to Ohio,'' Herman said.

One regional mover and shaker who seems to get it is Rob Briggs, president of the Akron-based GAR Foundation, Herman said. He credited Briggs with some of the ideas in the book.

Briggs once convened ''the top believers in the region and asked them to produce an international talent blueprint,'' Herman said. Aspects of that effort are beginning to emerge around the region.

He pointed to the EB-5 Regional Center in Akron and Wooster (which speeds up the visa process for foreign investors of American businesses), an international welcome center being discussed between Cleveland State University and the Jewish Community Federation, and increased activity around international student recruitment and business recruitment (such as Akron Mayor Don Plusquellic's missions to lure foreign companies into launching American operations).

If the Mahoning Valley doesn't have an international talent blueprint, it better craft one ASAP. The Regional Chamber took a strong step in that direction when it hired Eric Planey. The trade trip to China is an impressive undertaking. What about an analogous workforce development strategy?

The "America First" mentality that James Traficant represents is alive and well in Greater Youngstown. Congressman Jason Altmire, TechBelt co-conspirator, has pandered to the anti-immigrant sentiment of his constituency on more than a few occasions.

Being tough on illegal border crossings and putting America's prosperity first don't preclude immigration as an economic development strategy. Too often, we throw that baby out with the bathwater. The debate is polarized as closed borders versus open borders. Or, you are either anti-globalization or anti-American jobs. These are difficult waters for politicians to navigate, but the issue is mission critical for a struggling region.

Spotlight on Warren

All the natives won't move back to the Mahoning Valley, but there is more value in the expatriate community than just numbers. Those who leave have an easier time seeing a bigger region. Where you went to high school is still important, but not to someone born and raised in California. From far away, the fate of Youngstown and Warren are obviously intertwined.

The rapidly evolving story of the Warren advance-energy incubator should interest everyone in the entire TechBelt. Enter Rebecca Bagley, the CEO of NorTech (Cleveland):

Bagley, U.S. Rep. Tim Ryan, D-17 Ohio, state Sen. Capri Cafaro, D-32 Hubbard, state Rep. Tom Letson, D-64 Warren, and Mayor Michael O’Brien, outlined their vision Monday of what such an incubator might achieve in the fields of “advanced energy and flexible materials.”

Long on optimism and short on specifics, the four expressed hope the incubator will rejuvenate manufacturing in Mahoning Valley through infant enterprises that one day produce parts for windmills, geothermal, solar and nuclear energy plants and sources of energy other than petroleum, coal and natural gas.

You can find out more about Bagley's vision for Northeast Ohio here. You can also read more about NorTech's plans here. The effort dovetails nicely with the big energy sector push going on right now in Pittsburgh.

Warren could play a key role in the growth of this industry. That's good news for Youngstown and the entire Mahoning Valley. The bad news is the border between Ohio and Pennsylvania. NorTech covers Northeast Ohio, not the entire TechBelt. How Cleveland and Pittsburgh can work together is still a mystery.

Global Green Youngstown

The greening of the Rust Belt is a big part of the vision for this megaregion's future. The primary reorientation is turning to face all the lakes, rivers and streams that used to serve as a dump for all the industrial waste. Green manufacturing is supposed to help along this transition:

Thursday in Copenhagen, U.S. Rep. Timothy J. Ryan announced what he's calling a ''transformational partnership'' between Youngstown and a national environmental group to foster green job creation and development in the rust belt city.

California-based Global Green USA will help speed along planning efforts in the city by building on the Youngstown 2010 plan and putting into place citywide and neighborhood specific greening plans.

The move, Ryan said, could position Youngstown to be a model green city for other Midwestern communities by, simultaneously, reducing its carbon footprint and by doing so, becoming an economic engine in the growing green industry.

''We are leading the green revolution,'' Ryan, D-Niles, said. ''This innovative collaboration will help to elevate Youngstown, northeastern Ohio and the Cleveland-Youngstown-Pittsburgh tech belt - opening us up for global investment in cutting edge green energy technology and sustainable development in our district.''

Not to diminish the gratuitous TechBelt reference, the Global Green USA partnership imagines a green city that serves as a redevelopment model. Youngstown is to be a test tube for sustainable urban design. Helping to fund this initiative is a member of the Youngstown Diaspora:

Jack Scott, a former Youngstown resident who runs a technology company in the Salt Lake City area, and the Raymond John Wean Foundation each contributed $25,000 to this program.

Scott's name rang a bell. He was involved in the Sustainable Energy Forum held last summer at Youngstown State University:

Abraham credited YSU alumnus Jack Scott with being the driving force behind the conference.

Scott earned a degree in mechanical engineering and worked his way up to become president and chief operating officer of Parsons Corp., a California-based engineering and construction company that has $3.4 billion in annual revenues.

Scott said he has a passion for sustainable energy, but he wanted to hold the conference in Youngstown because of his love for the Mahoning Valley and its people.

“One of the greatest assets of this area is the work ethic,” he said. “We hire people from all over the world. You can always tell people who were hired from this area.”

Scott said the forum has to produce action to be a success. The goal is to link researchers with innovative ideas to people who can bring those ideas to market, he said.

Discussions are to be held today on how to continue the collaborations, he said. Also, he and other organizers will meet Wednesday to review the effort and talk about the future.

The issue of sustainable energy is critical for the nation, Scott said. The nation needs to rebuild its manufacturing base to remain an economic power, and a new opportunity is to produce parts for wind turbines, solar panels and other new forms of energy, he said.

The nation should not rely on other countries for these forms of power as it has done with oil, he said. The U.S. sends nearly $1 trillion a year to Saudi Arabia and other oil-exporting countries.

“It’s the single biggest transfer of wealth in the history of the world,” he said.

Scott is an archetype for the region's diaspora economy. One needn't reside in the area to benefit the Mahoning Valley. Scott's success and expansive network are assets for his hometown.

Blog Release: Round Two of EfficientGovNow to Offer $330,000 in Grant Awards to Government Collaboration Projects in Northeast Ohio

The Fund for Our Economic Future, a collaboration of philanthropic entities working to strengthen the region's economic competitiveness, introduced EfficientGovNow earlier this year to encourage greater government collaborations and engage the public to advocate for change.

EfficientGovNow is a competitive grant awards program that encourages and accelerates government collaboration and efficiency by providing rounds of funding to government collaboration projects as selected by YOU, the residents of Northeast Ohio.

The first round of the program, held in early to mid 2009, attracted more than 255 local governmental entities to submit ideas for collaborative projects. Collectively, the projects estimated one-time savings of nearly $40 million and anticipated annual savings of more than $22 million – dollars that can be used to grow and/or attract businesses, provide more education and training, or spent in other ways that grow the economy.

Equally exciting, you, along with nearly 13,500 other Northeast Ohioans, voted in support of the ideas. You participated in a way that motivated government officials to continue to seek ways to collaborate and become more efficient.

That is why, earlier this month, the Fund announced a second round of EfficientGovNow – this time offering $330,000 in grant awards.

RIGHT NOW is your chance to help get this round started. Check out 10 easy ways Northeast Ohioans can spur the second round of EfficientGovNow. Getting engaged is as easy as e-mailing a government official, following EfficientGovNow on Twitter or Facebook, or forwarding EfficientGovNow news coverage to a friend.

Your voice is essential to this effort. Help spur greater government collaboration -- help advance the economic revitalization of Northeast Ohio.

Ragnarök Youngstown

Once again, Mahoning Valley misery is national news. You've seen the images a thousand times. If not in Youngstown or Warren, then in Detroit. The new round of photos don't look so fresh. They haven't for 30 years:

In this corner of northeast Ohio, from Warren to Youngstown, where the old steel mills along the Mahoning River stand like rusted-out mastodons in the weeds, the recession was a final cruelty piled on top of three decades of disappearing jobs. ...

... The road from Warren and Youngstown is a graveyard of silent machines behind chain-link fences. Near the Pennsylvania border, this 25-mile stretch along the Mahoning River was the world's fifth-largest producer of steel until the late 1970s, when more than 50,000 jobs vanished in a decade. The General Motors plant in Lordstown, which employed 14,000 in the 1970s, is down to about 2,500 workers.

Every time globalization goes into one of its funks, some journalist is grasping for the final nail in this region's coffin. The angle is the same, as are the images. It is cliché, the latest downturn providing another excuse to dredge the Mahoning River for the body of Industrial America.

The real story, if you can pry your eyes away from the urban blight, are the changes. The "final erasure" is the burial of the glory days, a blank slate. However, a writer can't look at the current pain without relating what happened in the late 1970s. This isn't the flaking gild of the Golden State or dramatic collapse of Motor City. Thus, everyone overlooks the transformation in order to provide another glimpse of a crumbling steel mill. It's supposed to be a sign of the times.

These aren't the last days of disco.

Rust Belt Porn

I figure most people are familiar the pejorative usage of the term "Rust Belt". The image is one of deep economic malaise and over-dependence on anachronistic industry. These shrinking and decaying cities are stuck in a permanent recession. The stubborn stereotype:

Pittsburgh was devastated by the collapse of the domestic steel industry, but reinvented itself through education and medicine, and has done relatively well in recent years. Local unemployment is now at only 7.7 percent, well below the national average. However, there are limits to Pittsburgh’s recovery, and the city’s many college graduates often move away in search of work.

The current Pittsburgh renaissance deserves an asterisk, but not for the reasons stated. When anyone thinks of a Rust Belt city they include population decline. That's still the Pittsburgh bugaboo, the dreaded brain drain. This is the most persistent element of Rust Belt mythology. It's also the most erroneous.

Here is Youngstown at the bottom of another list (top US cities for business):

In late 2008, Youngstown was deemed by Forbes to be one of America's fastest-dying cities.

"It's not shocking," said Albert Sumell, assistant professor of economics at Youngstown State University. "Obviously, we haven't had good news in a while."

But, he says, the city is showing signs of life. While Youngstown is shrinking in size, it's embracing its smaller future, not just simply expecting it to come back. The city has set up a business incubator that is trying to encourage tech-oriented companies to get started there, and its downtown region is undergoing enough of a renaissance that The Economist magazine recently said it may have turned a corner.

"I think in some ways, our history is worse than our future," Sumell said. "I honestly believe our reputation, nationally, is worse than our potential."

Youngstown does have one Russell 2000 company in its metro area, Stoneridge Inc. (SRI 8.05, -0.10, -1.23%) , a maker of electrical components for cars, in suburban Warren.

But for now, the city is at least in the bottom third in all metrics, the bottom fourth in nine of 10 metrics and the bottom 10% of three. Its growth and job numbers are low, and the city struggled mightily to retain jobs during the past year; it was sixth worst in that metric.

The problem is in the methodology:

We also checked population growth since 2000 and measure job growth against population growth from the beginning of the decade to July 2008, the latest population data available.

In and of itself, population growth isn't a useful way of measuring health. A shrinking city such as Pittsburgh is still being punished for an exodus that happened 25 years ago. That out-migration still defines the city. Youngstown is similarly defined more by its past than the current state of affairs. The legacy costs are staggering. The ranking analysis also suggests the city is a victim of its own geography. The agglomeration economies of larger cities provide them with a comparative advantage.

Many of the metrics used strike me as outdated, a relic of the industrial economy. The booming population of Nigeria doesn't make it an economic power. Despite the loss of people, Pittsburgh is ranked 23rd on the list. So the supposed brain drain becomes the scar on an otherwise glowing review. A Rust Belt city can only go so far, so fast. But that is only a problem if the residents believe it to be true.

Youngstown, believe in Dream City. The measures you see above capture the past, not the future. Take it from someone who still hears the tired refrain, "At least we're not in Pittsburgh."

Myths of Brain Drain

As a Rust Belt refugee, I obsess brain drain policy. This preoccupation has developed into a successful blogging niche. I've been studying this issue for about 3.5 years and I continue to notice a steady flow of false information about a perceived brain drain problem.

A declining population is often used as a surrogate for brain drain:

The other two sectors to enjoy significant growth have been education and health. Yet these fields do not seem to generate the broad-based economic growth needed to boost the overall economy. The region most often favorably linked with the "eds and meds" economy, Pittsburgh, has produced only modest, below-average job growth over the past generation. In fact, Pittsburgh has looked successful largely because the region has continued to hemorrhage its population to other regions, and it attracts few foreign immigrants.

To be frank, the above assessment is bogus. The analysis barely scratches the surface of the demographic story. Pittsburgh did "hemorrhage its population to other regions" back in the early 1980s. But the overall population decline over (at least) the last decade is a result of an aging population dying off and an anemic replacement rate (that does connect to the lack of immigration). Joel Kotkin's claim is wrong and he should know better. I gather he hasn't digested the articles I have written for his website.

Kotkin is in good company. Jumping to brain drain conclusions is the rule, not the exception. Few seem interested in drilling down into the numbers to get a better idea of what is going on in the region. A recent study of rural brain drain is an excellent example. Minnesota Public Radio recently tackled the issue and unearthed some surprising results:

Given this refreshed view of changing demographics, rural America needs to rethink its description of gains and losses. If rural America is losing high-school educated youth (the brain drain) and replacing them with those that at least have a bachelors, isn’t this a Brain Gain?

Indeed, this is brain gain. But Kotkin and others are too busy trying to shoehorn their preferred narrative to notice. The result is misguided policy and government waste, which is ironic given the dominant perspective of many brain drain fear mongers. The rush to judgment only serves surreptitious ends. Brain drain talk is a popular political football. Beware when politicians and pundits invoke the term.