Today we take a slightly off-topic detour, before we launch into a new series of ERP posts. (Beginning with our next post, we’ll be taking a hard look at the impact of ERP software in the distribution and wholesaling arena, courtesy of a new report recently published by Aberdeen Research.)
Today’s slightly off-topic post is still of general interest, I think, to our base of manufacturers and distributors, because it’s about some timely and topical topics: namely, the success factors behind U.S.cities that are actually creating jobs today.
The keys lie in two areas near and dear to our hearts: entrepreneurs and education. In this case, a recent article in the November 29th Wall Street Journal (p. A3) points up some interesting correlations that have led to certain cities (notably, Austin, Texas, among others) growing jobs.
You can read the article yourself if you’re a Journal subscriber, but if not, the gist of it is this: They’ve found that a great way to create jobs for people who didn’t go to college is to attract highly skilled entrepreneurs “and watch the companies they start hire lower-skilled workers.”
Even as manufacturing dwindles as an employment base, it turns out that an effect is happening in the tech and service sectors that is similar to what previously happened in manufacturing: jobs – even highly intellectual ones – tend over time to get broken down into increasingly smaller and more granular tasks. Just as assembly lines one broke down manufacturing production into discrete tasks manageable by individuals, these high-tech and high-intellect jobs are going the same way.
So, by attracting entrepreneurs, who in turn are hiring the best and the brightest, cities end up creating even more jobs for the lesser-educated — say, those with an associate’s degree. Towns (like Austin) with faster growing influxes of population tend to grow even faster still, and take great advantage of this phenomenon.
The article points out that forty years ago, the disparity (in the percent of workers with at least a bachelor’s degree) between the 10 most and 10 least educated metropolitan areas in the U.S. (among the top 100) was about 13%. Now, it’s more than double that. In a sense, the smart (cities) are getting smarter. Metro areas with the highest percentage of workers with at least a bachelor’s degree have generally fared better in the downturn, too. The article cites cities including Boston,Washington DC area, Madison, Raleigh-Durham, andPortland, ME as its top five.
And of course, these so called “brain hubs” go beyond generating new mid-skills jobs: they’re also generating higher incomes. There’s a whole new crop of new middle-skill, middle-income specialties that are growing the employment base, spreading the wealth, and creating new job opportunities in these cities.
But it all starts by nurturing entrepreneurs. Cities that create the right environments (a whole other topic…) are sowing the seeds for their own long term success… in growth, in income and in quality of life. And one feeds upon the other.