Thursday, April 18, 2013

Ohio's Economy Rides on Suburban Backs, Again

It's an annual thing.  The Site Selection magazine "Governor's Cup" issue comes out every March and Ohio fairs pretty well.  For 2012, Ohio was second only to a very-hard-to-beat Texas with 456 projects proceeding or announced.  The majority,  242 of them, were manufacturing projects.

It's also an annual thing to notice from where the win comes.  The rest of the story is that it was, again this year, Ohio's suburban areas that carried the state to such a great showing.  Pat yourselves on the back small cities.

A review of the Ohio Private Investment Survey for 2013 shows that 93% of the manufacturing projects in Ohio happened outside of the 3C's--Cleveland, Cincinnati, and Columbus.  Since manufacturing is such a vital part of growing Ohio's economy, it's astounding to consider such a lopsided number, but it's true.

Among 16 manufacturing projects with a capital investment over $50 million for 2012 in Ohio, the 3C's garnered a combined zero. If you're keeping score, that's $3.28 billion to $0.

These are not new trends. 

No seasoned economic development official is at all surprised to hear that it's Ohio suburbs and smaller cities that are bringing Ohio's economy along.  Last year's report stood at 94%.

The report also shows that 74% (339) of all 456 large projects in Ohio happened outside of the 3C's counties too.

This, also, is nothing new.  The percentage of projects happening outside of Ohio's three largest counties has never been lower than 68% in the past five years.
  • 2012: 74%
  • 2011: 68%
  • 2010: 71%
  • 2009: 73%
  • 2008: 74%
So, why do I write this?  My summation column from last year still stands:  The best policy for Ohio is to keep investing where the growth occurs.  Invest in success.  Any smart business person would do that. Why shouldn't policymakers?

Stats like this show that Ohio policymakers need to be on alert to lobbyists who attempt to curtail Ohio's suburbs or divert revenue from growing areas as if that was a formula to boost Ohio's densest cities.

Using that age-old pie analogy:  Instead of fighting, cities vs. suburbs, to get a bigger piece of a shrinking pie, you have to grow the pie so everyone gets a bigger piece.

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