4 reasons why job hubs are the solution to NE Ohio’s economic future

Editor’s Note: This is the second article in a four-part, month-long series published on Cleveland.com.

By the Fund for Our Economic Future

Focusing development within job hubs can be a differentiator for the region

The COVID-19 disruption to business-as-usual serves as both an imperative to get Northeast Ohio back on its feet as quickly as possible as well as an opportunity to put the region on a more competitive, inclusive and sustainable trajectory.

For the last several years, the Fund for Our Economic Future has championed an alternative business development strategy that can save local governments money, increase businesses’ access to talent, improve residents’ access to jobs, advance racial equity, and lower carbon impact and help the environment. These outcomes are consistent with both state and federal priorities, which means embracing this strategy now can position Northeast Ohio for future stimulus, innovation and infrastructure programs.

The strategy centers on bolstering job hubs — specific places of concentrated economic activity — across Northeast Ohio. These hubs of activity meet thresholds for number of jobs and types of employers and are located in both urban and rural areas. Strategically coordinating development and focusing resources in job hubs is different from the current, long-standing approach, which prioritizes short-term gains. While attracting jobs to the region is crucial, there are serious drawbacks to focusing only on the short term:

  • It stretches local governments. Much of the new development in Northeast Ohio has meant the conversion of greenfields — farmland and other undeveloped space — into housing, office space and industrial parks. Why are taxes so high? This development pattern is an important contributor as municipalities must spend increasing amounts of their tax revenue to provide infrastructure for new development while also maintaining the often vacant or underutilized infrastructure that’s left behind.
  • It makes it harder for people — most especially the region’s Black and Latinx residents — to access jobs: As development expands, jobs (many of them high-paying, mid-skill jobs) locate farther away from where people live. This increases commute times and costs, diminishes quality of life, and creates huge challenges for residents who don’t have access to a reliable car. The burden falls heavily on residents of predominantly Black, Latinx or low-income neighborhoods where the rate of car ownership is low, resulting in the conundrum of “no car, no job; no job, no car.” (See Paradox Prize.)
  • It makes it harder for businesses to attract talent: Businesses face challenges filling open positions and retaining workers in part because people live farther and farther away from where jobs are.
  • It’s bad for the environment: Outward migration leads to inefficient use of resources, water runoff issues, a bigger carbon impact, and a decline in air quality from the increase in single-occupancy commutes.

The Fund’s assertion has been that focusing development within job hubs — both the places that meet the definition currently and those with high potential to — can lead to highly attractive, accessible business locations and be a differentiator for the region as it competes globally. (The region becomes even more competitive when this strategy is combined with a well-functioning talent development system and sector-specific strategies for growth of in-demand, family-sustaining jobs.)

To test this belief, the Fund engaged the Upjohn Institute for Employment Research to explore whether the clustering of business locations in proximity to each other and to civic resources is beneficial to competitiveness and to the fiscal health of a community.

The research team found that measurable competitiveness benefits are created when companies locate in proximity. The ability to share infrastructure increases access to talent and fosters the spread of ideas and connections. Concentrated development provides fiscal and economic benefit, too, even though traditional modeling techniques don’t typically reflect the potential positive impacts.

Still skeptical?

The Fund also has been supporting three job hubs pilots — in the “Aerozone” located around Cleveland Hopkins International Airport, in the city of Barberton in Summit County, and in northern Stark County — to demonstrate how the approach can benefit both urban and rural areas.

In each of these places, local leaders have come together to map the job hubs and prioritize sites available for development. This work is leading to near-term, tactical site improvements and is expected to support longer-term plans for the hubs to attract investment.

For instance, the Aerozone is nearing completion of a strategic plan that focuses on expanding technology transfer and maximizing the impact of business retention and attraction all within a highly-connected physical district. This strategic work is the result of leaders in local and county government, business, transportation, workforce, and utilities coming together to coordinate around a bigger vision.

Positive results can also be found in Stark County, which has become the first recipient of grants from the Ohio Site Inventory Program (OSIP) from JobsOhio. OSIP offers grants and low-interest loans to support speculative site and building development projects with no identified end-user.

Perhaps most importantly, these efforts represent strategic alignment and meaningful commitment to both short-term gains and long-term opportunities — evidence that business as usual isn’t the only way.