Economic Development Council Policy Review
October Edition 2008
New Report Ranks America's Top-Performing Cities
What are America's best-performing cities?
Cities with strong technology, energy and trade sectors lead the nation in job creation, according to a report released today by the Milken Institute and Greenstreet Real Estate Partners.
In the 2008 Best-Performing Cities Index, Provo, Utah, leads the rankings, which are dominated by thriving metro areas in Texas, Washington, Utah, Alabama and the Carolinas.
The annual index provides a snapshot of where America's jobs are being created and sustained. It factors in both long- and short-term indicators of employment and salary growth, as well as technology output measurements. The 2008 results reveal a broad rebound in the technology sector, plus strong activity in exports and energy production.
The top 10 cities for 2008 (with their 2007 rankings in parentheses) are:
1. Provo-Orem, Utah (8)
2. Raleigh-Cary, North Carolina (10)
3. Salt Lake City, Utah (18)
4. Austin-Round Rock, Texas (20)
5. Huntsville, Alabama (16)
6. Wilmington, North Carolina (2)
7. McAllen-Edinburg-Mission, Texas (7)
8. Tacoma, Washington (50)
9. Olympia, Washington (37 in the 2007 ranking of small metros)
10. Charleston-North Charleston, South Carolina (12)
Several metros that once topped the rankings fell due to a sharp downturn in their housing and construction markets; formerly booming locations in Florida and California took particularly significant hits. Cities in the industrial Midwest that depend on manufacturing also continue to suffer a long-term decline.
The Milken Institute/Greenstreet Real Estate Partners Best-Performing Cities 2008 index is available for free download at www.milkeninstitute.org. The national rankings and underlying data can also be explored at http://bestcities.milkeninstitute.org.
Ethanol: Too Much or Too Little?
Illinois is getting another ethanol production facility in Madison worth $275 million. The state will assist with $4 million in financial assistance towards development. Abengoa Bioenergy is building the plant on a 79-acre site in the Tri-City Regional Port District. The grant comes from the state’s Renewable Fuels Development program. The governor claims that the project would create good-paying local jobs and help reduce the nation’s dependence on foreign energy. The project is expected to create 250 construction jobs and 60 permanent jobs. The new plant will be in Representative Jay Hoffman’s district, one of the governor’s strongest allies. The plant is expected to be in operation by late 2009. It will produce an estimated 88 million gallons of ethanol a year from corn and other cereal grains. The plant is said to be one of the cleanest and most efficient ethanol facility in the United States.
This will be Abengoa’s first in Illinois and stated that it is in an excellent location with easy access to river, rail and highway transportation. It could also be well-suited to the future production of ethanol from cellulose sources states the company’s president and CEO. Abengoa BioEnergy is a division of a Spanish company, Abengoa SA, the world’s leading producer of ethanol and one of the leading producers in the nation, with four plants and three more under construction. Vice-President Christopher Standlee said that ethanol is a growth industry despite the rising price of grain. He attributed the rising grain prices to rising gas prices and said he was confidents that improved ethanol technology will reverse that trend. In all, 49 ethanol plants are operating, under construction or have applied for permits in Illinois, up from four in 2000. For some towns though, ethanol is a lost dream.
Ford Heights Ethanol LLC applied in June 2006 to build a distillery in the Illinois town that bears its name, promising economic revival to replace abandoned houses and closed stores. Two years later, no work has begun. For Ford Heights and other agricultural towns, the “green-collar” job revolution envisioned by federal biofuel mandates is a dream deferred. Knee-high grass and old tires cover the site as record prices for corn, the main ingredient in ethanol, discourage investment in new plants. The $20.8 billion industry may have itself to blame. Breakneck construction led to 169 ethanol plants, already producing more than U.S. mandates require for the fuel additive this year. The distilleries buy so much corn-as much as a third of the U.S. crop this year- that they have contributed to price increases. Claims and Houston fuel-consulting company, “we have in fact overbuilt. This thing is pretty devastating.”
Initial enthusiasm has given way to concern that diverting crops for fuel is accelerating a rise in food costs. Some U.S. food companies formed a “Food Before Fuel” coalition to oppose ethanol mandates. Ethanol may account for 20 percent of the gain in the rate of U.S. food inflation.
The overcapacity prevents lenders from financing ethanol plants that distill ethanol from corn kernels. President of Ford Heights Ethanol claims that lenders balked at funding the project and that one of their biggest regrets is that they couldn’t get manufacturing in a community that so desperately needed it. Across Illinois, 795 million gallons of ethanol are on hold. That’s slowed construction and growth in permanent ethanol-related jobs. The 168 plants had capacity for 9.96 billion gallons as of Aug. 26, almost 1 billion more than the U.S. requires this year. Another 43 plants scheduled to be build or expanded would raise capacity to 13.8 billion gallons.
Gov. Announces Plans for Biofuels Production Facility
Ethanol is Dream Deferred for Farming Towns Too Late to Biofuel
Filling the ‘Forgotten Middle’
More education is better than less in a tough job market but a college degree isn’t necessary for a good-paying job. A new study by the Workforce Alliance focuses on the large “forgotten middle” of the labor market, such as dental hygienists and truck mechanics, require more than a high school diploma but not a four-year college degree. Many of these pay better than the median wages and can’t be outsourced. These positions are nearly half of all employment in Illinois and are projected to represent nearly 1 million job openings during the decade ending in 2014. However, there is a shortage of workers to fill these jobs.
The report is part of a national campaign called Skills2Compete that advocates one of the most ambitious agendas since the GI bill sent 8 million returning service men and women to school in the 1940s and 50s. The goal is to guarantee access to schooling beyond high school for all workers through associate degrees, apprenticeships and occupational certificates. Every worker should have access to at least two years of post-secondary education and training that can be pursued at whatever pace works best for them is a major part of the campaign. The campaign also aims to examine the belief that the labor market is dominated by low-skill service jobs at one end and higher-paying jobs that require college degrees at the other. The notion ignores that about 45 percent of U.S. job openings between 2004 and 2014 will fall in the large middle range of skill requirements. In Illinois, middle-skill jobs will account for 47 percent of all openings through 2014 while 43 percent of non-college-degree workers have some post-high school schooling.
A manager of training and development services for S&C Electric Co. states that the decline in vocational programs that prepared high school students for skilled trades, coupled with demographic shifts, made it harder for the city’s manufacturing plants to find workers. There’s a misperception that manufacturing is a dying industry. Low-skill tasks go overseas, but there has to be a foundation of skilled employees to keep high-tech manufacturing in the city. The associate director of the non-profit Chicago Jobs Councils said that every time there is a spike in unemployment is an opportunity to reinvest in workers.
Filling the Forgotten ‘Middle’
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