Growing Your Own Economy. Dell Gines, MBA, CEcD Federal Reserve Bank of Kansas City Sr. Community Development Advisor

Transcription

1 Growing Your Own Economy Dell Gines, MBA, CEcD Federal Reserve Bank of Kansas City Sr. Community Development Advisor

2 The Federal Reserve Bank The views in this presentation do not necessarily represent the views of the Federal Reserve Bank of Kansas City nor the Federal Reserve System.

3 The Federal Reserve Bank of Kansas City Perspective The mission of the Community Development department of the Kansas City Federal Reserve Bank is to support the economic growth objectives of the Federal Reserve Act by promoting community development and fair and equal access to credit. The Grow Your Own Guide provides a high level overview of what it takes to conduct entrepreneurship based economic development. Our job is to serve as a neutral convener of resources between those who have and those who don t, because we know all segments of the population, including the less advantaged, benefit from both economic growth and fair and equal access to credit.

4 Federal Reserve Bank of Kansas City The Tenth District consist of Nebraska, Oklahoma, Kansas, Colorado, Wyoming and portions of Missouri and New Mexico

5 What It Is Really All About Family Community Quality of Life Opportunity Enjoyment of Place Local Control

6 Big Pictures

7 Big Pictures

8 Hebron, NE

9 Traditional Definitions

10 The Blended Model The lines are becoming progressively and by necessity increasingly blurred between the major models of development.

11 Defining Economic Development Fostering a dynamic environment where economic opportunities can be discovered, taken advantage of and maximized to their fullest extent to create balanced and sustainable economic growth, jobs, a positive sense of place and an improved quality of life in a defined geographic region. Dell Gines

12 Entrepreneurship Based Economic Development Defined Entrepreneurship based economic development is an economic development strategy that places its primary emphasis on the creation and support of entrepreneurs and small businesses to achieve development goals within a defined geographic region. IT IS NOT: Anti intelligent attraction and retention strategies. IT IS: Pro creating a best fit approach to economic development that takes into account current and future possibilities.

13 Zero Sum Attraction Attraction based economic development is like the Bachelorette TV show. Some communities will never be the last one chosen.

14 $80,000,000,000 Incetives Awarded $ 80,000,000, Deals Analyzed Average Deal $ 533,333.33

15 Development Model Distinctions Traditional Development Hunting Company Centered Organization Visible Victories Win/Lose Mutually Exclusive (IE Border Wars) Capital, Land, Labor Incentives Entrepreneurship Development Growing Owner Centered Organic/Network Long Term Growth Portfolio Collaborative Human, Social & Financial Capital Connections

16 Benefits of Entrepreneurship A few reasons why grow your own development is a powerful tool: Entrepreneurs create jobs, increase local incomes and wealth (Henderson, 2002). A higher ratio of entrepreneurial activity is associated strongly with faster growth of local economies (Barth, Yago & Zeidman, 2004) Local entrepreneurs are more likely than branch plants to reinvest their wealth locally. Entrepreneurs create a sense of place. The cost of job creation is lower (Edmiston, 2006) Grow your own development helps create diversified economies. This kind of development is just a better fit for certain communities.

17 Where Do Jobs Come From? Number of Firms Number of Firms by Employment Size of Firms Companies with 0 to 99 employees represent: 98% of all firms 35% of all employment 26% of all estimated receipts 69% of net new jobs are created by Stage II growth companies Half of the jobs in the nation are in small businesses Employment Size of Firms Chart Data Source: Small Business Administration.

18 Looking at Rural Business Source: Factors Affecting Spatial Variation of Microenterprises in the Rural U.S. 2010

19 Looking at Rural Business Yet there is now one self-employed worker for every three wage and salaried workers in rural areas, and urban areas are not far behind. If current trends continue over the next decade, every third worker will be self-employed or the proprietor of his or her own business. Source: The Economic Impacts of Self-Employment 2012

20 Looking at Nebraska As population increases Self-employment Businesses with 1 to 9 Employees Number of Business Per Population

21 The Five C s of the Entrepreneurship Ecosystem

22 Philips County, Kansas

23 Philips County, Kansas Philips County Sales Tax Revenue Philips County Economic Development was formed in 2003 $400, $350, $300, $250, $200, $150, $100, $50, $ Sales Tax Revenue 2003 $ 180, $ 196, $ 201, $ 284, $ 341, $ 345, $ 345, $ 340, $ 371, $ 399,519.00

24 Philips County, Kansas Philips County has a population of 5,519 as of 2012

25 Philips County, Kansas Time Involvement: Creation: 45% Expansion: 25% Community Development: 15% Retention: 10% Recruitment: 5% In small counties, community development is economic development Jeff Hofaker, Philips County

26 Cody The Town to Tough to Die

27 Save The Date Grow Your Own Summit September 30 th to October 1 st Denver, Colorado

28 Contact Dell Gines Sr. Community Development Advisor Federal Reserve Bank of Kansas City (402) For more information & resources To sign up for our Community Connections newsletter please me at the address above.