#144. Five New Realities of Economic Development

Posted on | The Agurban
Five New Realities of Economic Development

In the Summer 2007 edition of Economic Development America, the heading “The Five New Realities of Economic Development in the 21st Century” caught my eye. Sandy K. Baruah, head of the Economic Development Administration, authored the article because, as she stated, “I’m in the ‘what’s next’ business. What is the next strategy to keep the U.S. economy growing? What do ED leaders need to do today to be able to take advantage of the next big thing tomorrow?”

In order to answer the “what’s next” questions, Sandy believes we must consider these five new realities of economic development in the 21st century global economy. We will touch on the first three today, and wrap up the list in next week’s Agurban. 

1. We are in a Global Economy – In the new global marketplace, competition is not just from the firm down the road. Our competition comes from any person in any corner of the globe with a good education, a good idea, and a good Internet connection. With the global marketplace come opportunities for global partnerships and opportunities to expand our markets and increase our competitiveness. And, with 95 percent of potential customers for American products outside the United States, this reality becomes more important every passing day.

2. The Pace of Change will Continue to Accelerate – Competition is intense, and the pace of change will continue to accelerate. It took 55 years for the automobile to spread to one-quarter of the U.S. population. It took 35 years for the telephone to do the same thing. The personal computer accomplished the same level of market penetration in 16 years, the cell phone in 13 years, and the Internet in only seven years. Even the nature of innovation itself is changing; Innovation is becoming multidisciplinary as different technologies converge, creating fields that didn’t even exist just a few decades ago. This new reality will require all institutions – public, private, educational and non-profit – to continually adapt and change. Those that don’t are at risk. Those that do have the opportunity for reward.

3. The Components of Competitiveness Can No Longer be Pursued Separately – The world becomes a bit more complicated every day, and in order to respond to this increased complexity we must realize that the components of competitiveness can no longer be pursued separately. This reality holds two important lessons at the local and regional level: First, the idea of workforce development, community development, economic development and educational programs occurring in separate silos can no longer be tolerated. These challenges must be tackled in concert. Second, we must acknowledge that we are stronger when we stand together that when we stand alone. We must look beyond traditional political jurisdictions – the city boundary, the county line, even the division between states – and work together.

Look for next week’s Agurban for the final two “new realities”, along with our conclusion.