Personal View: What Will it Take for NEO to Rebuild Our Economy Right?

By Bethia Burke, Personal View for Crain’s Cleveland Business

For the past few weeks, I have felt like a tsunami is coming. I don’t know when it’s coming or how big it will be, I just know I can’t stop it. The advice is to stand still, hold your breath and hope you weather the storm.

This is impossible advice. There is a need to act, to lessen the impact of the public health crisis and save human lives. To take steps to mitigate the long-term economic consequences of businesses closing and nearly 16 million people filing for unemployment across the nation (with more coming).

I assumed the role of president of the Fund for Our Economic Future, an organization focused for the last 16 years on the long-term, systemic transformation of our regional economy, on March 19. Suddenly, amid a rapidly unfolding crisis, I find myself grappling with philanthropy’s collective response to an unprecedented economic blow for residents across our region and nation. Chief on my mind in recent days: After the immediate effects of the crisis are mitigated, what will it take to rebuild our economy right?

In immediate response to the pandemic, like many others, we at the Fund have been adjusting our work to align our strengths with the urgency of the moment. For instance, we’ve been sourcing ideas and interventions from national partners, like the Brookings Practitioner’s Network and the National Fund for Workforce Solutions. We’re providing direct support to Cuyahoga County’s economic development team as it develops strategies for the near and long term, particularly targeting small business support. Through The Paradox Prize, we’re working to connect nonprofits on the front lines with a surge in mobility needs to public transportation assets that might be able to support them. We’ve begun to analyze the potential local economic impact (see a geospatial analysis of the industries most at risk in Northeast Ohio here) and are digging in on the $2 trillion CARES Act to understand the effect on businesses and people, on nonprofits and economic development organizations. And we’re strategizing with workforce development partners on shifts in service delivery the sudden change in employment will necessitate.

Even more than what we’re doing through the Fund, I could not be prouder of our members and partners as they have sprung into action. From the rise of rapid relief funds, the quick pivots of businesses to meet escalating health care demands for personal protective equipment, the focused efforts of economic and community development organizations bringing critical aid to struggling businesses, the abundance of research measuring the scope and scale of the impact to guide how to respond, and the individual acts of kindness, from donations to meal deliveries. This is remarkable community building.

Yet, with all the activity to help mitigate the immediate economic impacts of the COVID-19 pandemic, what will happen next?

While there are many unknowns, this feels certain: The economic reverberations of COVID-19 will be profound and the burden will fall on already overburdened individuals, families and businesses. This moment of unprecedented crisis is further exposing structural inequities by race and ethnicity and will disproportionately affect low-wage workers. Small businesses are already suffering, and, as in the Great Recession, minority- and female-led enterprises are likely to face disproportionate impact.

This crisis will undoubtedly alter the structure of our regional and national economy. But the core fundamentals of what make an economy strong — attention to job creation, job preparation and job access with equitable outcomes by race and place — don’t change. As the country moves forward with $2 trillion (or more) of stimulus money and tries to minimize job loss, not to mention human loss, rebuilding strategies need to emphasize these fundamentals — factors ignored or underprioritized for too long.

Following the Great Recession, Northeast Ohio’s economy suffered harder and for longer than our peers. This is another inflection point. Northeast Ohio can emerge stronger on the other side of this crisis, but it matters what leaders do today. And it matters that Northeast Ohio learns from yesterday.

Unprecedented levels of investment from the federal government are an opportunity to seed growth in innovative industries and push for relevant skill-building. The real societal consequences of an economy reliant on jobs without basic benefits like paid sick leave are increasingly apparent; these consequences emphasize the need for stepwise improvements in job quality for all workers. The all-hands-on-deck approach to stabilizing small businesses in communities calls for attention to place and long-term asset building to help us build up and reinforce job hubs.

Strategies like these offer the potential to drive long-term growth with equitable access to opportunity and to close — rather than exacerbate — the economic divide by race and place. Such strategies also must be pursued intentionally. Now is the time to learn from other economies that came out of the Great Recession more quickly than Northeast Ohio. If we do, this time we can rebuild it right.

Bethia Burke is president of the Fund for Our Economic Future.

 

Bethia works with our members to identify and shape new opportunities, conduct due diligence and review performance outcomes of grantee partners.