Rethinking the way we grow jobs
Let’s pay more attention to germinating businesses already here
By Brent Barton, Bob Jenson and Jefferson Smith, Oregon House of Representatives
“In the long run, between the hunters and the farmers, the farmers always win.” —Anonymous
We often ask how to attract businesses to locate here. But what about growing businesses that already call Oregon home?
The current economic crisis requires us to hone and rethink business development. Attention often focuses on reeling in big fish. In addition to being increasingly competitive and costly, this mindset reflects an era when Fortune 500 companies employed a larger share of workers. Recently, “stage-two” businesses — often defined as having from 10 to 100 employees — have emerged as the top job creators and drivers of growth. We can capitalize on this trend by paying more attention to germinating businesses already here. In other words, in addition to “economic hunting,” we need “economic gardening.”
The story of economic gardening began in Littleton, Colo., in 1987 when a major employer laid off several thousand workers. Economic development director Chris Gibbons looked at luring in another major manufacturer, but he took a different route when he realized that any company chasing lower costs might soon leave for better offers elsewhere.
economic gardening presents an opportunity to amplify our work
Having seen research from MIT’s David Birch contending most new jobs came from a community’s small and medium-size businesses, Gibbons set out to grow Littleton’s economy from within. Twenty years later, Littleton’s job base has grown twofold, while population has grown less than 25 percent.
Economic gardening is now the subject of a chapter in the Small Business Administration’s book, entrepreneurial foundations promote it heavily and a number of communities have launched economic gardening strategies.
Axiom Electronics, a high-tech company based in Beaverton, is a homegrown example of the value of this approach and of enhanced market information. One of the first clients of Beaverton’s economic gardening program, Axiom now supplies major aerospace companies across America.
Economic gardening boosts access of businesses to market intelligence. Wal-Mart or Microsoft have whole floors devoted to competitive analysis, market research and consumer trend tracking, but such tools are typically beyond the reach of smaller businesses. Companies drive their own success; economic gardening helps accelerate that drive. Providing access to intelligence, mentorship, enhanced business service connectivity and infrastructure is a key to unlocking the potential of local companies, creating jobs and revenue that stay in Oregon.
Through Business Oregon efforts such as Oregon Inc. and others, our state works to encourage startups and make Oregon hospitable to bigger companies. As we build a high-road economy, economic gardening presents an opportunity to amplify our work. Rather than working harder to make Oregon the cheapest date with tax breaks and incentives, we should do more to nurture local businesses.
A bill [HB 3644] we helped pass with a bipartisan super-majority in the recent special session will establish a task force of business leaders, economic developers and agency representatives to assess Oregon’s continuum of business services and recommend an economic gardening strategy.
This small bill about a bigger thing [which was signed by the governor in March] will help push Oregon forward as a leader in homegrown business development.
Brent Barton, a Democrat, represents Clackamas; Bob Jenson, a Republican, represents Pendleton; and Jefferson Smith, a Democrat, represents Portland in the Oregon House of Representatives.
LEARN MORE ABOUT ECONOMIC GARDENING
The concept of economic gardening is gaining favor in many community development circles as an alternative to the traditional practice of recruiting—or hunting—businesses. Find out more about economic gardening at these sites:
Economic Gardening: An Entrepreneurial Approach to Economic Development: In 1987, the City of Littleton, Colorado pioneered a daring new strategy in an effort to infuse its faltering economy with new life. The approach resulted in a 71 percent increase in employment and a tripling of sales tax revenues since 1989 while providing no incentives or tax breaks. This website was developed in response to all the inquiries the town has received by communities that want to duplicate Littleton’s success. The site features a comprehensive essay by Christian Gibbons, the town’s director of Business/Industry Affairs, who conceived of the idea in the early 1980s.
The Oregon Economics Blog: OSU professor Patrick Emerson offers a contrarian view of the economic gardening strategy. “The problem in Oregon is not the bureaucratic environment—in most measures of business friendliness Oregon scores near the top,” Emerson writes. “The problem is in the fundamentals, like education, where Oregon scores near the bottom.”