For months now the state’s Economic Policy Council has been drawing a road map of sorts, outlining where our economy is, and how it can expand as a part of greater regional economy. That outline appears graphically on the following two pages. “We’re putting Rhode Island’s economy in context,” said Kip Bergstrom, the council’s executive director. “There is opportunity around us.”
Bergstrom sees Rhode Island as part of a regional economy that includes Boston, New Hampshire and Connecticut, based upon solidifying our manufacturing base, expanding our knowledge-based industries, and taking advantage of rapid changes in transportation.
Rhode Island's Market Has Changed. Developers, Builders, Investors and Sellers Must Change With It.
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The Regional Positioning Initiative is based on the concept that state lines are “artificial constructs in the contemporary global economy,” Bergstrom said.
Here’s a description of what appears on the following pages, as provided by the Economic Policy Council:
No state is an Island
Most industries routinely interact across state and national boundaries – and successful businesses know that the size of their markets is limited only by the extent of their capabilities. Government economic development efforts need to reflect that kind of thinking.
In today’s economy, metropolitan regions are the real drivers. And Rhode Island is not a discrete, self-sustaining economy. Rather, it is part of the Boston metropolitan region – the fifth largest metro in the United States. Providence is actually the second major hub in the Boston Metro, and that status – along with Rhode Island’s place on the region’s second major transportation corridor (I-95) – offers an extraordinary competitive advantage to our state.
Developing a cluster strategy
Leading economic development research supports the concentration of development efforts on “industry clusters” which already have emerged in a region on the strength of market forces. These natural strengths from the focus of a region’s competitive advantage.
As part of a comprehensive market analysis program, the Rhode Island Economic Policy Council has identified strategic economic development targets within the Boston Metro by industry cluster. The chart on pages 20 and 21 offers a new conceptual framework for viewing the Rhode Island economy as an integral part of the Boston Metro. This analysis will allow identification of those existing and emerging industry clusters which offer the highest growth potential in the region – thus channeling economic development resources most effectively.
Growing high-wage clusters and nurturing middle-wage jobs
The Policy Council’s analysis reveals two groups of industry targets: high-wage, high-skill industry clusters and middle-wage, middle-skill clusters, both of which show signs of future growth.
The high-wage industries heavily concentrated in the Boston Metro – software and communications, innovation services such as consulting and research, financial services, electronics, and medical technology – offer excellent economic development targets for Rhode Island.
To capture a share of the growth expected in these fields, Rhode Island must pursue cluster development opportunities aggressively. However, we must continue to support and nurture middle-wage clusters in manufacturing and logistics services such as wholesaling and transportation.
EPC analysis shows that the Boston Metro is losing middle-wage jobs, particularly in manufacturing and logistics services. This trend signals a growing threat to the balance and security of the regional economy. While the region as a whole is losing these “middle” jobs, Rhode Island continues to have a relatively strong manufacturing base which is likely to see strong wage growth. This sector must be protected and expanded; maintaining a balance of jobs across the wage scale facilities upward mobility, and middle-wage jobs offer a “bridge” to high-wage jobs for skilled workers.
Charting the course
Pursuing a cluster strategy will require Rhode Island companies, universities, and government agencies to assume new roles. Firms need to work closely with universities to create post-secondary programs which will prepare skilled workers. Business and academia must also collaborate to maximize technology transfer capabilities, turning ideas into jobs for Rhode Island.
Universities must sharpen their appreciation for the potential for successful, innovative local companies to help build academic programs over time. And state economic development officials must continue to focus on their roles as catalysts and facilitators of industry cluster interaction in competitiveness, workforce development, technology transfer, and other key areas of improvement.
The Rhode Island Economic Policy Council is pursuing a multi-pronged agenda of market research, workforce preparedness initiatives, and business development programs which will facilitate the effective channeling of the state’s economic development resources.
A key item on the Council’s 2000 work plan is the creation of a comprehensive manufacturing strategy for Rhode Island. The council is also developing a positioning strategy geared to expanding Rhode Island’s share of the Boston Metro’s high-wage, high-skill industry clusters.
