CT News Junkie | OP-ED | A Starting Point to Discuss Improving Connecticut’s Competitiveness

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OP-ED | A Starting Point to Discuss Improving Connecticut’s Competitiveness

by | Apr 29, 2016 7:00am
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Posted to: Analysis, Business, The Economy, Technology sector, Financial Sector, Jobs, Opinion, State Capitol

Earlier this month, the Business Council of Fairfield County Foundation presented a Connecticut Economic Competitiveness Diagnostic, prepared by McKinsey and Company, to the state’s Commission on Economic Competitiveness.

The diagnostic, which represents more than $1 million in professional analysis, is part of the Business Council and Foundation’s long history of engaging its member executives in public benefit research and best practice exchange,” Christopher Bruhl, Business Council of Fairfield County president and CEO explained.

Bruhl reminded the Commission that “competitiveness is not the same thing as the overall performance of state government or the choices by its elected representatives for the issues facing the state.”

Alas, that’s something we know all too well — but as the diagnostic reveals, the latter can impact the former. More on that in a moment.

Let’s look at Connecticut’s strong points as highlighted by the report first — because despite the constant naysaying, we do have many:

1. We have a smart and productive population
2. We have good schools — although with an achievement gap in our urban districts
3. We have Blue-Chip Companies and Growth Sectors
4. We have a good quality of life, high life expectancy and a low crime rate — but again there is a divergence between suburbs and cities.
5. We’re strategically located
6. We’ve got a strong research output

But the fact remains that we have to wake up and smell the new economic coffee. Even though we’re still ranked 4th in GDP, 3rd by productivity and 4th by median household income, Connecticut hasn’t fully recovered from the 2008 recession, and according to the report, we’re not growing at the rate we’d like because we’re contending with four key factors:

CT Economic Competitive Diagnostic Summary Results —Global and national forces are impacting our traditional core business sectors and technology is changing the way we work and live
—Peer states (NY, NJ, MA, MD, DE) are closing the gap on our livability and cost advantages
—Lack of population growth and our long-term suburban orientation has serious implications for our ability to meet future employment needs
—Perceptions are hardening on state governance and fiscal uncertainty

The current legislative session is doing nothing to help such perceptions — if anything it’s exacerbated them. That’s why we need to pay serious attention to the ideas in this diagnostic — while continuing to ask more questions.

CT Economic Competitive Diagnostic Summary Results The report suggests five areas for the commission to consider exploring: Growth Sectors, Transportation, Cities, Public Private Engagement, and Fiscal Confidence

These all make sense and there will and should be arguments about priorities. People in the suburbs will have to restructure their thinking about cities — to start to recognize that they are the engines that can drive Connecticut’s growth if we invest in them properly.

But we still need to ask questions, otherwise we’ll end up with another expensive, delayed stadium project while urban schools are still underfunded.

And then there’s this:

Co-Commission chair Joseph McGee, who is also the Vice President of Public Policy and Programs for the Business Council of Fairfield County, mentioned during the hearing that “buried in the background notes” was the data that “HB1 visa holders are responsible for the creation of over 50 percent of early stage companies in the United States.”

CT Economic Competitive Diagnostic Summary Results This rang false given previous reporting on the abuse of H1B visas leading to the outsourcing of Connecticut jobs. Indeed, earlier in the presentation, McKinsey noted that, on average, higher paying industries in our state have shrinking employment — and information technology was one of those.

After some sleuthing to figure out where McGee came up with the 50 percent figure — because neither McGee or co-chair Rep. William Tong have responded to inquiries — what I found was that a March 2016 study from the National Foundation for American Policy suggests 51 percent of technology companies worth over $1 billion were founded by immigrants. But they weren’t necessarily here on H1B visas — some had immigrated as young children, or stayed in the states after attending college under different visa programs, or they co-founded their company with American founders but were given full credit as founder for the study’s purposes. It’s possible this was the “buried” study McGee was citing.

This isn’t to discredit in any way the positive benefit of immigrants on the U.S economy. We were all immigrants once. It’s merely to point out that we need to look at this diagnostic as a starting point, not gospel, to note its source, and to be aware of its limitations in providing a full picture.

Rep. Tong said quite emphatically at the hearing that “this is not the answer.” The diagnostic has certainly raised many good questions for consideration. We have to ensure that the answers the commission came up with aren’t just another top-down response from the same politically favored voices. What we need instead, going forward, if our state is to be truly successful, is a true, good faith enterprise that has buy-in from all the communities it purports to benefit.

Ellen Shemitz, Executive Director of CT Voices for Children, reminds us: “Even as Connecticut struggles with changes in the economy, it remains one of the wealthiest states in the nation, with adequate resources to make significant, strategic investments in its human and physical assets. Any successful road map to economic competitiveness needs to address existing inequities and barriers to success as well as build new opportunities and attract new resources. It is not enough to invest in our cities; we need to invest in communities of opportunity.”

Marc Abraham from DataHaven suggests that an important question we should be asking throughout this process is: “Who benefits from a strong economy?”

We are already a state with tremendous inequality.  The “solution” to our problems shouldn’t make it worse.

Sarah Darer Littman is an award-winning columnist and novelist of books for teens. A former securities analyst, she’s now an adjunct in the MFA program at WCSU, and enjoys helping young people discover the power of finding their voice as an instructor at the Writopia Lab.

DISCLAIMER: The views, opinions, positions, or strategies expressed by the author are theirs alone, and do not necessarily reflect the views, opinions, or positions of CTNewsJunkie.com.

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