Transforming Your Local and Regional Economy – Gib son County September 4, 2014

1. Bo Beaulieu & Michael WilcoxPurdue Center for Regional Development &Extension Community Development Program Transforming Your Local and Regional Economy – Gibson County September 4, 2014

2. Special Thanks • Economic Development Administration, Chicago Regional Office • Kim Howard, Southwest ISBDC • Our Purdue Extension Colleagues

3. Something to Ponder The literature on job creation has frequently found that most jobs are created from existing employers, yet many local economic development organizations continue to emphasize new industry recruitment. Daniel Davis The Federal Reserve Bank of St. Louis. May 2011

4. Our Focus Today • Examine the economic resources and opportunities that exist in your county/region (but are often overlooked) • The stages of your local establishments • Regional competitive assets • Highlight entrepreneurship as an important aspect of your economic development stategies. • Identify ways you can cultivate entrepreneurship in your county & region

5. A Look at the Four Stages

6. Establishmentsin Gibson County : The Four Stages • Definition of company stages • Stage 0 (self-employed) • Stage 1 (2-9 employees) • Stage 2 (10-99 employees) • Stage 3 (100 to 499 employees) • Stage 4 (500+ employees) • This table is based on the National Establishment Time Series (NETS) database • The definitions for stages are based on research by the Edward Lowe Foundation • A firm can have more than one establishment within the same county Data Source: NETS 2011, Edward Lowe, IEGC, PCRD

7. Top Five Sales Establishments by Company Stage, 2011 Data Source: NETS 2011, Edward Lowe, IEGC, PCRD

8. A Look at Your Working Labor Force

9. Gibson County, IN

10. Gibson County Commute and Labor Sheds Commuting • Gibson County is an employment center given that larger number of workers are commuting into the county for work than are commuting outside the county for work. • Net commuting (In- commuters minus out- commuters) is positive in the county with a gain of 516 commuters. • Gibson County residents are commuting to only a handful of counties, mainly to Evansville metropolitan area for purposes of securing work. • On the other hand, residents from several surrounding counties are commuting to Gibson County for employment purposes • The footprint of Gibson County as a workplace extends well beyond the boundaries of the county. 10,127 9,611 6,434 Source: OTM, LEHD, U.S. Census Bureau; PCRD

11. Gibson County Commuting Gibson County as Home • Gibson’s commute shed touches major metropolitan area of Indianapolis, Tippecanoe and Lake Counties (Chicago metro area) • Major economic ties with Vanderburgh County (Evansville metro area) Source: OTM, LEHD, U.S. Census Bureau; PCRD

12. Gibson County Workplace • Gibson’s labor shed extends to one adjacent county in IL and KY • A labor shed is a region from where a job center (Gibson County) draws its labor force. Ten counties provide around 82% of the labor force. Source: OTM, LEHD, U.S. Census Bureau; PCRD

13. Gibson County Region, IN • Based on commuting patterns, the region includes the following counties: • Wabash county in Illinois • Dubois, Gibson, Knox, Pike, Posey, Vanderburgh, and Warrick counties in Indiana • Henderson county in Kentucky Source: RDM, PCRD & ESRI

14. Economic Attributes of Gibson County Region • Trade balance (exports minus imports) is positive Data Source: EMSI 2013.2 & Census

15. Gibson County Region Note: Label includes cluster name, LQ 2013 and Employment 2013 Data Source: EMSI 2013.2, industry cluster definitions by PCRD

16. Gibson County Region Note: Label includes cluster name, LQ 2013 and Employment 2013 Data Source: EMSI 2013.2, industry cluster definitions by PCRD

17. Gibson County Region, Industry Cluster Analysis, 2008-13 L e v e l o f S p e c i a l i z a t i o n Stars Mature • Advanced Materials • Agribusiness, Food Proc. & tech • Apparel & Textiles • Biomedical/Biotech (Life Sciences) • Chemicals & Chemical Based Prod • Energy (Fossil & Renewable) • Forest & Wood Products • Glass & Ceramics • Transportation Equip Mfg • Manufacturing Super-Cluster • Electrical Equipment, Appliance & Component Manufacturing • Primary Metal Manufacturing • Transportation & Logistics P e r c e n t G r o w t h i n S p e c i a l i z a t i o n Emerging Transforming • Defense & Security • Fabricated Metal Product Manufacturing • Mining • Arts, Entertainment, Recreation & Visitor Industries • Business & Financial Services • Computer & Electronic Product Manufacturing • Education & Knowledge Creation • IT & Telecommunications • Machinery Manufacturing • Printing & Publishing

18. Star clusters • IN average earnings; $44,298 • Gibson county region average earnings, $44,060 Data Source: EMSI 2013.2, industry cluster definitions by PCRD

19. Gibson County Region, Industry Clusters, 2013 Data Source: EMSI 2013.2, industry cluster definitions by PCRD Red numbers in parenthesis are negatives

20. Regional Requirements, Expenditures & Leakages, 2012 Note : ** presents “Star clusters in 2012” Data Source: EMSI 2013.2, industry cluster definitions by PCRD

21. Strengthening Clusters throughImport Substitution Seek to Identify: • Industries that support the cluster • Goods and services purchased from outside the region • Capacity for supplying these inputs regionally • Resources needed to help promote the creation, retention/expansion or attraction (recruitment) of businesses that can supply these inputs

22. Takeaways • Consider focusing on first & second stage enterprises in your county as part of your economic development efforts. • Assess the opportunities that exist at the regional level; find and build on the region’s competitive strengths • Explore ways to reduce the economic leakages associated with your “star” and “emerging” clusters

23. Cultivating Entrepreneurship in Gibson County Michael Wilcox and Bo Beaulieu Extension and PCRD September 4, 2014 Presented in Princeton, IN

24. Local Industry Establishments: The Five Stages • Definition of company stages • Stage 0 (1 employee) • Stage 1 (2-9 employees) • Stage 2 (10-99 employees) • Stage 3 (100 to 499 employees) • Stage 4 (500+ employees) • This table is based on the National Establishment Time Series (NETS) database • The definitions for stages are based on research by the Edward Lowe Foundation • A firm can have more than one establishment within the same county Data Source: NETS 2011, Edward Lowe, IEGC, PCRD

25. Top Five Sales Establishments by Company Stage, 2011 Data Source: NETS 2011, Edward Lowe, IEGC, PCRD

26. Self-employment in Gibson County, 2007-2012 Data Source: EMSI, 2014 - Self-Employed - EMSI 2013.3 Class of Worker

27. Purpose To assist targeted communities in Indiana as they transform their local economies through the development of key components required for entrepreneurship and small business development. 

28. Relationships and Roles Three ways in which entrepreneurship plays a critical role in economic development… Entrepreneurship – the link between assets and finding new sources of competitive advantage and economic opportunity Entrepreneurs – recognize opportunity and bring together resources to turn opportunity into a viable business venture Entrepreneurial communities and leaders – understand their assets and mobilize to employ these assets through entrepreneurship development

29. Entrepreneurship as a Development Strategy Entrepreneurs and small business owners play an important role in local economic development, specifically… As Employers: creating new jobs and playing a significant role in hiring part-time workers and new workforce entrants As Tax Revenue Generators: broadening tax base, thus generating greater property and income tax revenues As Economic Supporters: buying and supplying local products and services. Income generated typically not exported out of local community

30. Entrepreneurship as a Development Strategy (cntd) and… As Property Owners and Renters: leasing space from local property owners and filling vacant storefronts downtown As Providers of Economic Stability: small homegrown firms are, by definition, owned and operated by people who have a personal stake in the community and are more likely to remain As Providers of Economic Diversity: entrepreneurs diversify the mix of business types and sectors which contributes to economic resiliency

31. The New Paradigm Needs to Embody Four Policy Principles Interconnectedness between rural and urban • Regionalism = rural and urban linkages • Systems = rural and urban resources • Assets = unique rural and urban strengths and markets • Ensure that urban and rural neighbors serve their region as equal partners

32. Policy Goals • More entrepreneurs • Increase the numbers • Stronger entrepreneurs • Increase the survival rate • More high growthentrepreneurs • Increase the number that create jobs and wealth

33. Program Goals These policy goals translate into program goals… • More entrepreneurs in the pipeline • More entrepreneurs staying in their community • Better informedentrepreneurs • Better skilled entrepreneurs • More job creatingentrepreneurs • Greater business productivity

34. Entrepreneurship andEconomic Development Research suggests that: • Growing firms from “within” is a more cost effectivemeans of creating profit centers, tax base and employment per job created. • Small, home grown firms play a significant rolein job creation in both urban and rural areas. • Communities should take a balanced approach to economic development and complement recruitment, business retention and expansion activities. • Your community is what brings it all together!

35. An Entrepreneurial System “An effective entrepreneurship development system integrates a wide range of programs and tailors products and services to meet the diverse needs of entrepreneurs. It should be comprehensive, flexible, culturally sensitive, and integrated, and should require providers to collaborate rather than operate independently or in isolation” - Dabson, 2005

36. Supportive Environment Component #1: Supportive Environment • Supportive environment: creating community and civic environments that celebrate and support entrepreneurs. • Be Entrepreneur-focused • Create ‘No wrong door’ • Celebrate entrepreneurs

37. Entrepreneur Networks Component #2: Entrepreneur Networks Entrepreneur Networks: facilitating opportunities for informal gatherings of entrepreneurs to share experiences and information. • Facilitate, but don’t lead • Networks should be “by and for” entrepreneurs

38. Training and Technical Assistance Component #3: Training & Technical Assistance Training & Technical Assistance: the creation of systems of advice, expertise and training appropriate to the needs of entrepreneurs – can be public, private, educational or nonprofit agencies. • ID your community’s “coaches” • Help entrepreneurs navigate the system

39. Access to Capital Component #4: Access to Capital Access to Capital: in the form most useful for the stage of business development • Connect entrepreneurs to local lenders • Increase the banking IQ of local entrepreneurs • Increase the business IQ of local bankers • Leverage regional and state funding • Incentives and assets

40. Youth Entrepreneurship Component #5: Youth Entrepreneurship Youth Entrepreneurship: programs to excite young people in schools, community colleges and universities about the possibilities of creating their own businesses • Build a pipeline of future entrepreneurs • Engage young people

41. Where do We go from here? Creating an Entrepreneurial System in Gibson County

42. Entrepreneurial Community Readiness According to Markley et al. (2005), communities that are “ready” have: • Particular capacities in human, financial, and physical infrastructure • A supportive business/entrepreneurial climate • A strong self-image with positive citizen and community attitudes • Open and creative community leadership, or leadership environment, that encourages and nurtures emerging leaders

43. Community Readiness Questionnaire

44. The Results

45. The Process

46. Who? Let’s create a list of institutions and associations that can assist us in the creation of a regional entrepreneurial system… Who else?

47. Who? • Variety of local “Boards” • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • _____________________ • Purdue Extension • Purdue Center for Regional Development • Local Initiatives Support Corporation • Chambers • LEDOs • Community foundation • Utility companies • Local governments • Revolving loan funds • United Way • Producer groups • Farm Bureau / Advocacy groups • Elevate ventures • 4H / FFA • Economic Growth Council

48. To Learn More about the Purdue Center for Regional Development, check our new website: https://pcrd.purdue.edu/ Thank you! Michael Wilcox and Bo Beaulieu wilcox16@purdue.edu and ljb@purdue.edu September 4, 2014 Presented in Princeton, IN