Why the US Economy Needs Immigrants… and Where.

Earlier this month, President Trump made headlines by repeatedly claiming that the United States is “full”—suggesting that, therefore, new immigrants to the US would no longer be welcome.

Journalists, commentators, and others were quick to take issue with the statement. Some argued on philosophical grounds. Others took issue on a more factual basis. In one response, reporters from The Upshot at the New York Times—in characteristically astute form—pointed out that, between declining birth rates and an aging population, prime-working age population is already decreasing in many places around the US. Without immigration, these places will face a decline in their labor force in coming decades.

In other words, not only is the US (and specifically, the US labor force) not full, many places are in serious need of migration.

A few days later, President Trump further confounded critics with the suggestion that migrants to the US would be sent to so-called sanctuary cities (a ubiquitous but legally informal phrase that has been self-designated by many cities, including many of the country’s largest, as well as many counties and several states).

In response, residents and representatives of many of those jurisdictions proudly suggested that they would be happy to accept immigrants. (I was glad to read that Pittsburgh’s own Mayor Peduto said as much.) But amidst all of the rhetoric, I worry that we are collectively paying woefully insufficient attention to important economic issues that underlie the conversation about immigration and workforce.

At Fourth Economy, we encounter workforce issues throughout our work. Attracting, retaining, and preparing the workers of tomorrow is a challenge that touches nearly all of our clients, from the Agricultural System of West Virginia to the Metro Hartford, Connecticut, and throughout the US. The age distribution of the workforce is also an important factor in the framework of our Community Index.

But communities around the country are not affected equally by this ongoing challenge. One way to measure the likely challenges of future labor force needs is to look at the concentration of an area’s labor force by age. The map below shows the percentage of the resident labor force in each US county that is above 55 years-old—that is, people who are active in the labor force, but who are older than what might generally be considered prime working age (25 to 54 years-old).

Communities where the current labor force is highly concentrated among older workers are likely to face increasing economic struggles in coming years. As older workers retire, there will likely be too few younger workers to take their place. Growth will decrease. Employers in some industries will compensate through automation. In other industries, remote work will become more common. But many employers in hard-hit areas will likely relocate or close.

The confounding bit is that the communities facing labor shortages are generally not the “sanctuary” communities where the President is threatening to send more new immigrants. They are instead more likely to be rural, and politically conservative communities, as shown in the scatter plot below. (Whereas many of the countries largest, youngest, and most rapidly growing cities are sanctuary cities.) Indeed, among the counties with greatest share of their labor force over 55 years-old—what we might reasonably designate the communities most in need of new workers—92% voted for president Trump in 2016.

Those facts on the surface are not that surprising. Sure, “Trump Country” is populated by rural communities with older labor forces. But the economic implications are being glaringly overlooked. What is being used to threaten to one part of the country is, in fact, a significant threat to the economic vitality of another.

Fourth Economy Analyzes Pittsburgh Region Life Sciences

Pittsburgh Region Life Sciences Benchmarking & Opportunities Analysis

The Pittsburgh Region Life Sciences Benchmarking & Opportunities Analysis report was prepared for the University of Pittsburgh with financial support from the Richard King Mellon Foundation and Hillman Family Foundation.

Fourth Economy Consulting conducted the analysis and report development in partnership with Warner Advisors during the summer of 2016. This report is meant to inform key Pittsburgh regional stakeholders about the assets and opportunities that exist in the life sciences industry sector and highlight areas of future focus. Read more from the Pittsburgh Post-Gazette here. The complete report is available here.

 

Pioneering a New Approach to Economic Development

A core principle at Fourth Economy is that economic development works best when it works at the intersection of environmental, social, and economic issues—a concept referred to as sustainable or triple bottom line economic development. A recent article published in Economic Development Quarterly by one of our Fourth Economy Pioneers gives some background into this concept.

Janet Hammer of The Collaboratory, the lead author of this research, notes that while traditional economic development delivers programs, policies, or activities designed to create or retain jobs and wealth, sustainable economic development does so in ways that also contribute to environmental, social, and economic well-being over time. This triple bottom line approach recognizes that economic development both influences and is influenced by a spectrum of factors like quality of life, fiscal health, resource stewardship, and resilience. Continue reading “Pioneering a New Approach to Economic Development”

The Four Keys to Effective Collaborations

The Fourth Economy team strongly believes in the power of partnerships in improving community and economic development outcomes. Through our work, we have managed numerous collaborations and identified four keys that lead to effective partnerships.

Patience, Participation, and Partnership

Effective collaboration can be difficult and often takes time. Therefore, it requires that all stakeholders have patience throughout the process of building partnerships and developing solutions. As partnership groups face challenging times, it is critical that they overcome these difficulties together and remain engaged in the effort. One difficulty that may arise is that as individuals and organizations collaborate to further a common purpose, they are typically guided by their own self-interest. These motivations are not always negative and can often support the success of collaborative groups when they are aligned with the goals of the larger partnership. In addition to acknowledging these self-interests, during initial conversations, these groups should identify outcomes and boundaries to focus their work. The group should allow for some flexibility in these areas as issues can change, but too much flexibility will impede the group’s ability to effect change and could cause stakeholders to leave the group. Continue reading “The Four Keys to Effective Collaborations”

Fourth Economy’s Jerry Paytas Appears on “Workforce Central” Podcast

I recently had the opportunity to appear on the Workforce Central podcast, where I discussed the current state of the economy, trends that workforce boards should be aware of, and my thoughts about the impact of the upcoming election on the overall U.S. economy. Workforce Central is the official podcast of the National Association of Workforce Boards.  The podcast is hosted by Ron Painter, President of the NAWB.

5 Lessons From the MLB All-Star Game for Economic Opportunity Pursuits

Overmoyer-MLBIt’s All About the Distance. Or is It?

Sure, power contributes to your ability to hit a home run, but it’s also the mechanics of how you swing that can take the ball farther. Many community and economic development initiatives throw a lot of money (power) at an issue without an understanding of the underlying issues and opportunities. A better approach is to use community input combined with real-time data to better understand the current local mechanics and what forms of investment (money and time) it will take to support change. Continue reading “5 Lessons From the MLB All-Star Game for Economic Opportunity Pursuits”

Embedding Equity Into Economic Development

Guest Blog by Sarah Treuhaft, Director of Equitable Growth Initiatives, PolicyLink

Treuhaft-Inequit-BlogIt is another summer in which America’s deep racial fault lines are being painfully exposed. Following the horrific violence in Baton Rouge, Falcon Heights, and Dallas, in a July 8 poll seven in ten Americans said race relations are “generally bad.” A National League of cities analysis of one hundred “state of the city” speeches from 2016 found that mayors increasingly view racism and inequities as major threats to progress in their cities.
Continue reading “Embedding Equity Into Economic Development”

The Challenge of Creating Actionable Plans

Burket-Blog-Web-05-2016As part of our work in our hometown of Pittsburgh, we have been digging into all of the plans that have been created over the past five years or so. So far, we’ve found around two-dozen plans, reports, or studies on all manner of community, workforce, and economic development topics. Of those, about five have well-articulated goals, actions, responsible parties, though the form and detail of those components varies from plan to plan. And even with detailed actions, the degree to which those plans are being implemented varies a great deal. Our experience in Pittsburgh is not unique – we see the same trend in the other places that we work. So why is it, that despite our best wishes and intentions, it is so hard to create actionable plans? Continue reading “The Challenge of Creating Actionable Plans”

What Is Not Being Addressed that Will Kill Your Economic Development Strategy

BooksforBlogAt this point I think we are all familiar with the struggles facing Detroit Public Schools, at least on the surface: mushrooms growing in schools, teacher strikes, financial crisis. However, as detailed by this incredibly thorough and thoughtful report by LOVELAND Technologies, 200 years worth of poor decision-making led Detroit to where it is today. This speaks to the need for a new approach to public accountability in our education system. Recognizing the critical role of public education to economic development, in Nashville, it has been the Chamber that has been stepping up to provide that platform for accountability by conducting annual holistic assessments and concrete recommendations for improvement. Continue reading “What Is Not Being Addressed that Will Kill Your Economic Development Strategy”

National Fourth Economy Community Index Lists Top Ten Large-Sized Counties

141204-FECIndex

Fourth Economy Consulting announces the latest release of its national community index, listing top counties from across the nation. The Fourth Economy Index highlights those communities ideally positioned to attract modern investment and managed economic growth within the fourth economy.

PITTSBURGH, PA – The latest edition of the Fourth Economy Community Index was announced today, recognizing the top ten large-sized Fourth Economy Communities. These communities—with populations between 150,000 and 499,999—were selected because they represent regions that are poised to achieve sustainable economic growth while attracting people and investment.


Continue reading “National Fourth Economy Community Index Lists Top Ten Large-Sized Counties”