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Investing in potential

The first time I visited Tupelo, I was impressed. I’d long heard of their aggressive and innovative methods to attract business to the area, and the proof was in the pudding. Here was a bustling little town in the middle of nowhere, seeming to defy the odds of success. Their mainstay was furniture manufacturing, and these jobs caused the town to swell to twice its size during business hours.

There was a time when the hill country of Northeast Mississippi appeared to get left behind. While the flatlands of the Delta boasted of their agricultural abundance, Tupelo languished. When farming fell on hard times, though, the town of Tupelo saw its chance to shine. City and business leaders understood the transition to manufacturing would bring much-needed jobs to the area. They actively went after business. Before long, this was the little city that could.

The rolling hills began to be filled with housing and retail developments and churches. Boy, do they have churches! The jobs poured in, and people followed. Standards of living increased, and everyone was happy. Life was good in Tupelo.
But we live in a shrinking world. Just like the transition which hit the Delta, change hit Tupelo, and it came with the globalization of the furniture business. When I visited Tupelo a few years ago, I noticed a difference. Instead of broad smiles on each face, I saw concern. Business was drying up.

At first, it was just the wood furniture products which were leaving. The Chinese could produce these and ship them to the U.S. cheaper than those made on home ground. At the time, Mississippians were still able to beat them on the upholstered side. That soon changed. Now, it’s cheaper to have the pieces upholstered overseas and ship them piecemeal to the States. Tupelo is left with assembly jobs.

This story of manufacturing is not unusual. With the flattening of the globe and its accompanying business model, labor costs are being driven down as companies move operations overseas. Big manufacturing plants everywhere are shutting their doors and relocating to places like China, India and Pakistan. While politicians promise measures to reverse this trend, the reality is that it can’t be stopped.

Again, the city and business leaders of Tupelo see the writing on the wall, and they struggle to find ways to hold on to their way of life. That’s how we got Wellspring, but we all know how that turned out. And the question is should we even try to attract manufacturing, or do we need to face the fact that we are transitioning to a service economy at lightening speed?

But, then there’s the Golden Triangle, that three-sided stretch connecting Starkville, Columbus and West Point. Something’s happening there. While the old-line manufacturing jobs are leaving, they are being replaced with high-tech businesses, which require the education and skill of high-end employees. This area in the middle of rural openness is booming.

What’s the difference? Most of the credit goes to Mississippi State University. The research taking place on that campus is leading to innovations, which are turning into real world applications. In a shrinking world, competition is fierce. The only way to keep up is to stay ahead.

We can no longer appeal to business with our abundant workforce. Our appeal lies in the expertise and creativity of our workforce, and that comes with an educational system that leads the way in math and science. It comes with combining knowledge with good old American ingenuity. It comes with an ability to adapt to a shrinking world.

Cities and states that understand this and develop an edge will prosper, while those who hold on to the old-line way of doing things will decline. If Tupelo cannot make the transition, they will end up looking like the towns in the Delta.

For the State of Mississippi, leaders must understand these forces. We must put our money where our potential lies and not try to shore up the old model. We must always look forward and plan ahead, because the world is shrinking. If we don’t step it up, we’ll simply get rolled over.

Nancy Lottridge Anderson, CFA, is president of New Perspectives Inc. in Clinton. Her e-mail address is nanderson@newper.com, and she’s online at www.newper.com. Her column appears monthly in the Mississippi Business Journal.


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