Minding Our Own Business

The State’s “Please Look at Me” strategy — trying to attract major manufacturing or service employers to Vermont — is under-funded and out of date and, quite frankly, hopeless.

Vermont’s Economic Development efforts have been largely ineffective, non-strategic and a waste of money — and they’ve been that way for several administrations. What’s more, few in the economic development sector would debate this conclusion. In the Douglas administration, leadership on the issue is MIA, and initiatives have little to show for their investment. This may well be true for tourism as well. As one tourism staffer recently commented, “It’s mostly about the leaves.”

It’s a sad situation, and the saddest part about it is that there are plenty of good ideas out there that could spur sound economic development initiatives, if only those in power would do more than pay them lip service and smile for the camera. Former governors will confide — in a quiet moment and without attribution — what the real challenge is: No qualified person will step forward to take these jobs. If that’s the case, why not hire a non-governmental agency to develop and execute a policy that will help the State grow strategically, in a framework consistent with its social, economic and environmental values?

Developing a sound policy requires knowing where things stand, and where they’re likely headed. For example, Vermont is comprised largely of small entrepreneurial businesses. Current unemployment here is under the national average of 4-plus percent. The state’s real problem is under-employment. Young and old who choose to live here do so knowing fully well what the work likely will — and won’t — pay.

According to Vermont Business’ top 100 list of employers in the state, seven of the 20 largest are not-for-profits. Vermont itself accounts for 9000 jobs. Fletcher Allen and IBM each employ more than 6000 Vermonters. The number of large multinational corporations here can be counted on one hand — one that has a few fingers missing.

The state’s “Please Look at Me” strategy — trying to attract major manufacturing or service employers to Vermont — is under-funded and out of date and, quite frankly, hopeless. Are we willing to spend the tens of millions of dollars in relocation subsidies and tax incentives it would take to compete realistically with South Carolina or Alabama?

People in the business community often whine about how awful it is to do business in Vermont. Their complaint is hardly unique. Wherever I travel the mantra is the same: “[Insert state name] is hostile to business.” Our provincialism leads us to believe we’re worse? Now there’s a marketing strategy for you.

In fact, Vermont has much to sell, and economic development is, at its most basic level, about marketing. Any sound marketing policy considers assets (what do I have to sell?), channels (how do I reach likely buyers) and markets (who are they?). Here’s how Vermont stacks up in those areas.

Assets: Vermont’s workforce is skilled, well-educated and fervid. Dynamic communities, good schools, high quality and accessible healthcare and human services, abundant natural resources, and transparent, corruption-free government all combine to create a rare quality of life. The State’s small scale makes it possible for a person, business or institution to make a discernible difference.

Channel: Our best opportunities are right here at home. We don’t need a high-powered media blitz to trumpet our assets. And that’s a good thing, since we can’t afford one; Oregon, for one, has the same assets as Vermont, and a lot more money. Rather than pursing the political pipedream of luring Boeing to Wolcott, we should focus on the myriad enterprises, for-profit and not-, developing within our own economy. Healthcare and its related industries are growing rapidly in Vermont. There are 35 software companies here; most people may not have ever heard of them, but they’re expanding. T The value-added slow-food movement has taken hold, and is piquing international interest. Higher ed is also burgeoning with Dr. van DerHayden’s total makeover of St. Mikes into a world class intellectual community with a Phi Beta Kappa chapter, and Middlebury and UVM’s recent expansions. These are just four of the niche sectors that promise incremental and sustainable job growth.

Markets: The Internet has changed everything, opening a broad pipe through which most Vermont goods and services can be sold to just about anyone in the world. Ben and Jerry’s pushes ice cream online. Vermont Mystic Pies and many of Vermont emerging artisan food producers also sell over the Internet. With a few exceptions, the Web makes it possible to sell just about anything directly to a consumer (B2C) or a business (B2B).

The concept of creating jobs by understanding local needs and cultivating existing companies is neither revolutionary nor original. Those in charge talk up the idea, and nod like bobble-heads at meetings, but they do very little either to understand indigenous businesses’ growth challenges or to construct support services that will help them reach the next stage of development.

Many entrepreneurial businesses have the seeds of their success already in place, but are being held back in one area, be it fiscal management, production skills, marketing or distribution. Entrepreneurs generally start out doing everything themselves, and are most at risk when they must make the transition to a “delegation / management” stage. The state could help by understanding this risk and providing material assistance where appropriate. That might mean, for example, helping artisan food producers to develop a Web coop and supporting distribution chain for selling their products worldwide.

There are effective but rare examples of this already happening. Bruce Seifer, at Burlington’s Community and Economic Development Office www.CEDOBurlington.org] helped form the Vermont Software Developers Alliance [www.VTSDA.org] a network for sharing resources, labor pools, ideas and strategies. The Vermont Business Roundtable’s [www.VTRoundtable.org] New Models Collaborative, a joint venture with the Vermont Forum on Sprawl www.VTSprawl.org explores business opportunities and strategies. The Roundtable’s PeertoPeer Collaborative, the brain child of Ellen Kahler, is another initiative that’s addressing the true nature and scale of economic growth potential in Vermont.

This isn’t rocket science. It’s common intelligence. It’s also incremental.

Casting into a fished-out lake in hopes of hooking the “big one” may be relaxing and make the angler feel important, but it hurts, rather than helps, the vigorous incubator that is Vermont business. Montpelier should either get on board and provide real, responsive leadership or else get out of the way and cede its modest budget allocation to people who live and breathe the local business climate — not as it might have been, but as it is.

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