ICIC Research Indicates State of the Union Promises Are On Point
?It is our generation's task?to reignite the true engine of America's economic growth ? a rising, thriving middle class,? said President Obama during his State of the Union address on Tuesday.
These words are music to the ears of inner city residents everywhere. Indeed, unlike his 2013 Inaugural Address, President Obama?s speech on Tuesday gave credence to the fact that Americans are still struggling; despite improvements in the economy, our lowest-income residents still suffer from a high cost of living and mediocre wages.
For months, Washington has been tiptoeing around fears of the fiscal cliff, the debt ceiling, and the sequester.
But as Obama said Tuesday night, reducing the deficit isn?t an economic plan. ?A growing economy that creates good, middle-class jobs ? that must be the North Star that guides our efforts.? We must find ways to create jobs, train workers to fill these jobs, and ensure that these are well-paying jobs. We must also find ways to lift residents out of poverty.
How do we get there?
Obama honed in on manufacturing as a primary means of job creation. Several companies are bringing manufacturing back to our shores; Caterpillar for instance has brought jobs back from Japan, and Ford has brought jobs back from Mexico. Even Apple will be making their Macs in the U.S. again later this year. It?s no wonder that 500,000 manufacturing jobs have been added to the economy since 2009.
As ICIC research has shown, investing in the industrial economy can help ensure that urban residents have access to well-paying jobs. Industrial jobs tend to have low barriers to entry and require little formal education, making them accessible to inner city workers.
The ICIC research team found that in St. Paul, for instance, urban poverty rates are more than twice those of the region. But the industrial jobs in St. Paul are high quality: while the average St. Paul job pays just over $43,000, St. Paul industrial jobs average $47,600. At the Saint Paul Port Authority?s Business Centers, industrial-related jobs average wages of nearly $50,000 each year. Despite salaries that are 15% higher than the rest of the city?s economy, most industrial jobs at the Business Centers require a high school diploma or less. Moreover, every industrial Business Center Job yields roughly 1.6 additional jobs for the region?nearly 60% higher than the corresponding number for non-industrial jobs.
To spur growth in the manufacturing industry, President Obama announced the launch of three manufacturing innovation hubs, similar to the first hub in Youngstown, Ohio. In Youngstown, a vacant warehouse was transformed into a state-of-the-art lab to teach new workers advanced manufacturing skills, such as 3D printing. President Obama asked Congress last night to fund the creation of fifteen of these hubs throughout the country.
But even with these industrial hubs, we cannot truly support manufacturing if we don?t protect our industrial assets. Cities must proactively safeguard industrial land from being rezoned for residential and commercial purposes?a trend that has taken hold in many cities nationwide.
Aside from manufacturing, the President highlighted the need to invest in American energy. ?We are finally poised to control our own energy future,? he proclaimed. In doing so, we open the door for new jobs, and safeguard families and businesses from unpredictable spikes in gas prices that have plagued us in recent years.
Again, this is good news for the urban poor. ICIC research indicates that overall, green jobs are growing faster in inner cities compared to other industries. In inner cities, green jobs experienced growth in the range of 6% to 12% from 1997 to 2008. In contrast, overall inner city jobs grew by only 1.3% over the same period.?
Flint, Michigan ? once devastated by the decline of the U.S. auto industry ? is one city that is hedging its rebound on clean energy. The ?Flint Clean Economy Project? strives to use clean technology as a strategy for creating good jobs, fighting poverty, and revitalizing Flint?s manufacturing sector. To do so, Flint is engaging in active supply chain construction and promoting cluster growth by encouraging linkages between stakeholders across the industry.
To ensure access to jobs in both the industrial and energy sectors, we must do a better job of educating students in the subjects of math, science and technology. ?Right now, countries like Germany focus on graduating their high school students with the equivalent of a technical degree from one of our community colleges, so that they?re ready for a job,? President Obama said Tuesday night. Here in the U.S., our lack of emphasis on these subjects is putting the American worker at a disadvantage globally. Innovative programs like P-Tech in Brooklyn ? which involves a public-private partnership between NYC Public Schools, the City University of New York, and IBM ? help students graduate high school with their Associates Degree in computers or engineering. Models like these should be spread to schools across the country to ensure a strong pipeline of workers for the new jobs we?re trying to create in the energy and manufacturing fields.
Still, trying to support the energy and manufacturing clusters are for naught if we do not invest in infrastructure. In his speech, President Obama proposed a ?Fix-it-First? program that would put people immediately to work on fixing nation?s 70,000 structurally deficient bridges across the nation.
Infrastructure improvements are particularly important to inner cities: on average, more than 40% of inner city bridges are deficient, a staggering 60% higher than the national average. Moreover, inner cities have twice as many bridges per square mile than the rest of the country, according to an ICIC study.
The bridge quality gap has cost inner city economies between 2% and 3% of their total job base?or upwards of a quarter of a million jobs?affecting key industries such as transportation, logistics and professional services. Infrastructure improvements in America?s inner cities offers the best opportunity to restore these lost jobs and create new jobs, both locally and regionally. ICIC?s research shows that a 10% decrease in the percentage of deficient inner city bridges is correlated with a 1.83% increase in inner city growth and a 1.69% increase in regional growth.
If President Obama is serious about ?Fixing-it-First,? he should begin by investing in inner city infrastructure, which has for too long been subject to neglect.
In doing so, we?ll put inner city residents back to work. We?ll expand access to manufacturing and energy-related jobs. And, as Obama echoed on Tuesday night, we will ?prove that there is no better place to do business than the United States of America.?
BY Amanda Maher on February 14th, 2013
TAGS: economic development | cities | jobs | business | industrial | infrastructure | manufacturing | what works
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