The Leader - May/June 2008 - (Page 65)

G l o B aliz a tion 2 .0 : site selection co ns ultants s co uri nG tHe G lo Be to Me e t cli e nts ’ DeManD s zations and individuals in Russia, Africa and the Middle East, it’s also important to know who’s really behind investments and funding development. This can just as easily apply to leasing space in London, New York or Dubai as it can to industrial projects and joint ventures in former Soviet Republics and China. As Ernst & Young’s Gibson points out, “real estate is the ultimate washing machine.” “If you’re the corporate real estate executive in charge, what social responsibility do you have regarding where you rent and who you do business with?” Gibson asked. “What responsibility does the brokerage community have? I don’t have the answer to that, but it’s something I frequently ponder.” That’s not to say that many U.S. and Western European economic development efforts are without fault, though. Many states and communities are doing a great job with economicdevelopment target marketing – St. Louis with plant genetics, Puerto Rico with medical device production and R&D, the Universities of Nebraska and Arizona with bioscience research and development, to name a few. Still, many communities and regions are lacking in one of the most basic efforts, economic development Web sites packed with current, accurate data, WDG’s Donovan said. Donovan would also like to see more communities adopt International Economic Development Council (IEDC) standards to better streamline data and create apples-toapples comparisons. “(Web sites) are the most cost-effective marketing tool that any city or state can have, and, for the most part, they don’t have it,” Donovan said. Mantra no. 2: sustainaBilitY Like “global,” you may have grown weary of “sustainability,” which is unfortunate because, as a corporate initiative, it’s not going anywhere. Of course, there are two contexts of sustainability – the environmental context and the literal context, as in, “is this project or operation sustainable at this location?” and, “how can we sustain economic growth in our city/ region/country?” From the environmental perspective, sustainable, renewable energy emerges as one of the leading economic development opportunities for communities in the U.S. and European Union. With photo voltaic cells and solar energy, Germany has the greatest rate of adoption, while the U.S. lags, though clusters are emerging in communities like Midland, Bay City and Saginaw, Mich., said Don Schjeldahl, vice president and director, Facilities Location Group, The Austin Co., Cleveland, Ohio. The industry poses few barriers to entry, and the technology to exploit its growth potential already exists. “Over the next 25 years, you’ll have hundreds if not thousands of factories built in the U.S. around this industry,” Schjeldahl said. “It’s the next auto industry, the next 100-year industry. If the cluster concept is true, some communities will be real winners.” A weak dollar creates opportunities in the U.S. for companies and investors from all over the world. Combined with many states’ incentives for green power production, the dollar’s downturn earns the U.S. a closer look for European firms looking to capitalize on the States’ nascent green energy sector. For example, LM Glassfiber, a Danish manufacturer of fiberglass blades for windmills, chose Little Rock, Ark., for its largest North American production facility. In narrowing down its site choices, the com- HoW Does nortH aMerica stack up? Thanks in large part to the low cost of labor in China, India and other areas of the world, North America has experienced significant losses of manufacturing jobs for several years. What does this mean for the economies of the United States and Canada? LEADER spoke with Don Schjeldahl, Vice President and Director of Facilities Location at The Austin Company about North America and how it will compete in the future. “I think most of the industries that have not been able to adapt to more automated, more technical production have already left,” he says, which means there will be a minimal decline in manufacturing jobs over the next decade. Many communities are concentrating their economic development efforts on “cluster development,” meaning they target specific industries like biotechnology and food production. Biotechnology is a very broad industry that’s difficult to enter, but provides long-term stability. “These are long-term, long-cycle developments, requiring lots of investment, partnerships, creating new products, and trials,” he explains. “It could be ten years before an investment starts to produce results, but the results can be significant.” At the other end of the spectrum are shorter term and easier-to-enter industries, like food processing. These tend not to be globally positioned, but rather regionally or locally. A community can promote itself as a food cluster, for example, if it provides the right balance of transportation, a clean environment, large tracts of land, and low labor costs. Those ends of the spectrum are not likely to go off-shore, Schjeldahl explains. In the middle of the spectrum are industries that are higher paying, more technically based, and keep up with the fast pace of change within the economy. These include products that are customized to market, short runs, and require quick delivery, such as the renewable energy market, which will be a very fast-growing industry. In the end, he thinks the number of people employed in manufacturing jobs likely won’t grow, but it will stabilize. But, he says the portion of the economy that’s related to manufacturing will grow. “I think the North American economic outlook is actually quite bright,” he says. “There will be a resurgence in manufacturing investments built more around technology and around skilled jobs that will continue for decades.” – Megan McCann tHe le aDe r 65 MaY / j u n e 2008

Table of Contents Feed for the Digital Edition of The Leader - May/June 2008

The Leader - May/June 2008 Leadership Contents Message from the CEO Real Estate in the News Green Real Estate Work Without Boundries Building Flexibility Into the Business Strategy Multi-Generational Work-Force Design Work Force Longevity Analysis Wells Fargo's David Nelson Pennsylvania's Michael Rossman Globalization 2.0 Site Selection Consultant Directory The New York Report: A Core of Traditional and State-of-the-Art Opportunities Discovery Forum Findings Industry Tracker Young Leader Career Development Effective Leadership Economic Development in the News A Look Ahead In Our Next Issue Calendar of Seminars Index of Advertisers Executive Development Spotlight

The Leader - May/June 2008

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