Friday, March 07, 2008

Who You Calling Rusty?

A study by the Columbus Chamber on behalf of the OSU Medical Center examines job growth in Central Ohio over the past 6 years, determining that OSUMC is responsible for half of the net job growth in the area over that time, and 3 of the top 5 employers in terms of job creation are in health care.

In Columbus, jobs and health care are not separate issues.

The most eye-catching pieces of the report, however, are two tables. One showing the 20 largest employers in the Columbus Metropolitan Statistical Area (treating OSU and OSUMC as separate entities), and the net jobs added or lost by those employers between 2001 and 2007. The title of this post refers to the fact that there is only one manufacturing firm among the top 20 employers: Honda. While Columbus is dominated by public-sector employees (being the state capital, county seat, largest city in OH, and home to the nation's largest university) the public sector employers represent 5 of the six biggest net losers of jobs, and the private sector is still represented by more financial services firms (Chase, Nationwide, Huntington) than it is by companies that produce or process commodities.

1 comment:

Paul said...

The economic health of a community is driven by how much money it draws in from outside its economic zone. In other words, there is not much gained if all that happens in a community is that the same old dollars get passed around as the residents trade their limited products and services with each other.

Private sector enterprises like Nationwide, Battelle, Honda, AEP and Limited are some of the critical net-importers of wealth to central Ohio. But we have lost some important ones like Lucent (formerly Western Electric), Westinghouse (now the Big Lots warehouse), Timken, and most recently, Delphi (formerly GM/Fisher Body).

I've become involved in an organization called Greater Common Good which is trying to create policy recommendations for public officials in the area of economic development.

A comment I made in our last meeting was this: we aren't actually that good at stimulating private sector development here in central Ohio. But it is being masked by the fact that we are the state capitol and home to Ohio State. Those two entities suck in all kinds of money from all over the state and leave a substantial part of here (e.g. in the salaries of all the state employees who work here). Then there are the trade and industry associations which locate here because it is the capitol. I'm thinking the Ohio Education Association, State Employees Retirement System, State Teachers Retirement System, and the like.

There should be a steady stream of entrepreneural outfits springing from the R&D carried out at OSU and Battelle. While it's easy to think of the incubators around Seattle (anchored by Microsoft) and the San Francisco Bay Area (Stanford, Intel, Apple, HP), we have the seeds of one at Kent State, called the Liquid Crystal Institute. The university does the primary research, and there are companies which formed around KSU to commercialize the research and in turn fund more.

The thing that's missing in central Ohio is venture capital. It's not that it's not here - it's just too damn hard to pry out of the hands of the VCs - even when it is actually money from the state's Third Frontier Fund.

I have three good friends who are VCs. One is in Seattle, one in Silicon Valley, and one in San Diego. Between them, they have funded startups that have become household names. But I can't get them to bring any more here. As one said - "I can find more good ideas within 30 mins of my house than there is in all of Ohio"

That hurts. It just means we have to figure out how to nurture entrepreneurs ourselves. OSU makes it unnecessarily hard to commercialize their research - you may have heard some of the horror stories with an outfit in which we are both acquainted.

Jim Collins says "Good is the enemy of Great." When you get to Good, it's easy to quit trying to get better. I think that's where we are.