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As I See It

Economic development really about people development

This week, the Mississippi Business Journal’s editorial focus turns to economic development, a subject that is near to my heart. If there’s anything that Mississippi really, really needs it’s a good shot of economic development.

Lots of people talk about economic development but it seems to me that lots of these folks don’t understand what they’re talking about. They yearn for new industrial parks with highways, railways, water, sewer and heavy-duty electrical lines and think if we can just get those things everything will be better. All that stuff makes impressive brochures. However, the missing ingredient in this cake mix is skilled workers. We can have the most impressive industrial facilities imaginable but if we can’t supply a good quality workforce we’ll fall on our face.

To set the ground rules we have to agree on a definition of economic development before we go thrashing about arguing whether this project or that project is worthy of support.

In it’s rawest form, economic development is raising the standard of living for the citizens of our state. If that doesn’t happen economic development hasn’t happened. A good measure of our standard of living is the average per capita income. Gauging the effectiveness of economic development by the increase in the average per capita income is a good way to keep score. To achieve real success, everybody’s boat needs to float a little bit higher. If the rich are merely getting richer and the poor staying at about the same income level no real economic improvement has occurred.

If the poorer citizens are to make more money then the value of what they contribute to the marketplace has to go up. Otherwise the economic pie doesn’t get any bigger. In order to increase the value of worker production they must work faster, longer or smarter. Merely working faster or longer is not a desirable outcome, particularly for the worker. Working smarter is the key. And, working smarter requires improving skills. The workers need more skill tools in their toolbox and training is the answer.

What really gets the economic development juices flowing is having an ample workforce of trained, motivated workers anxious to ply their skills at higher levels of performance than currently available. When, and if, this occurs, then employers will beat a path to our industrial parks to take advantage of the situation. If this condition is not present, new and better jobs will not be forthcoming regardless of how many beautiful parks we build.

How do we get there from here? A really, really good question that has baffled our state leadership for years and years. Our historical efforts at economic development centered on selling cheap labor and, to some extent, that mindset continues today. Our people would work for less than comparable workers in other states. As strange as it might seem, this was a pretty good strategy for many years. The new jobs were low paying, but they were jobs nonetheless.

Then came NAFTA and everything changed. NAFTA is good for the consumer, but bad of the low-skilled workers of our state. Changes in global economics made NAFTA inevitable so playing the blame game over who is allowing our jobs to dissolve is ludicrous. Our low- wage jobs were exported to other countries with even lower paid workers. Since a large part of our workforce hadn’t progressed much in building skills they weren’t prepared to compete for better jobs when the cheap stuff went south.

Again, educating and motivating workers to develop new and better skills is the obvious answer to the problem. Obvious yes, but extremely difficult. Our culture is not education friendly and, oftentimes, our workers are not motivated to better themselves by improving their skills. To further complicate the situation, our government provides social safety nets that reach down too far and offer a powerful disincentive to do anything. Whine, moan and wait for a check rather than get up and get moving.

So, there you have it. All the glitzy industrial parks that we can build won’t raise the per capita income if the workers aren’t trained and motivated to handle the higher-paying jobs. As long as our culture condones folks sitting home and waiting for someone to do something for them rather than seizing responsibility for their lives, we shall wallow in the mud at the bottom of the economic development lake.

Our education system is a mess. It’s in dire need of an overhaul from top to bottom. And that’s not the worst part. Every year thousands of our kids drop out of school and join the ranks of the unskilled. And, that decision amounts to a life sentence. With very few exceptions, dropouts will forever be dependents and rarely will they rise to being contributors. Why kids can’t see this is beyond me. But, they either don’t know or don’t care because they continue to dropout with discouraging predictability.

Folks who care about the future of our state need to seize every opportunity to preach the value of education to young people and the value of skill training to adults. This is the only thing that is holding our state back from advancing up the economic ladder from last place to somewhere higher up the rungs. Admittedly, it’s a restless swim but there is no other answer.

Thought for the Moment

The final test of a leader is that he leaves behind him in other men the conviction and the will to carry on. — journalist Walter Lippmann (1889-1974)

Joe D. Jones, CPA (retired), is publisher of the Mississippi Business Journal. Contact him at cpajones@msbusiness.com.

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