>> Tough stance against illegal immigrants will be opposed by business interests dependent on the availability of low-cost labor: restaurants, hotels, farmers, growers and construction companies. The tourism industry will fear that strict enforcement efforts will damage Florida’s image abroad and scare away international visitors, already annoyed by bothersome visa regulations. Small business owners will see a requirement to use E-Verify to confirm workers’ immigration status as a costly burden. Relentless attempts by the nativist wing of the Republican Party to follow Arizona’s example in cracking down on illegal immigrants will detract from Florida’s pro-business reputation, in the view of the Chamber of Commerce and other business groups. -- Palm Beach Post: Business interests played a major role in killing immigration control. (Dara Kam), 10May2011 >> Arizona-style immigration enforcement will deal a blow to Florida’s agriculture and service industries. It will put most tomato growers out of business because higher labor costs will shift production to Mexico, driving up unemployment since every farm job creates three downstream jobs in the state. Tomatoes are the state’s biggest vegetable commodity and earns about half a billion dollars annually. Besides agriculture, punitive enforcement would create severe labor shortages of low-cost labor for both construction and the hospitality sector -- low productivity industries that are unprofitable without a supply of cheap labor. A reputation for hostility toward Hispanics will create a Latin American backlash, undermining Miami’s role as a hemispheric gateway. -- TCPalm: Florida’s proposed immigration bill weighs heavily on business community (Nadia Vanderhoof), 12Feb2011. >> Nearly all job growth in Florida will come from expansion of existing businesses or the birth of new companies, not poaching them from other states, predicts a Brookings study. But the usual strategy of broad tax incentives, R&D grants, training programs and infrastructure building will not lead to significant job creation unless Florida first identifies geographic-concentrations of inter-connected firms and then develops specific strategies that will promote their future growth. Many state initiatives to nurture industry clusters ignore the nascent clusters that already exist as they try to build from the top-down. As a result, everyone is investing heavily in the same fields: life sciences, cleantech and information technology. Successful clusters will be much more narrowly defined. -- Brookings Institution: How regional industry clusters can add jobs, bolster entrepreneurship, and spark innovation. (Mark Muro and Kinan Fikri), January 2011 >> Florida will gain more jobs by encouraging new businesses – not just small businesses – and these new businesses are more likely to succeed if started by older entrepreneurs, not younger ones, contrary to current business mythology. Older adults have an advantage because they can more easily raise funds for their ventures and have the management experience and business contacts to set up a company and keep it running. Even in the dot.com era, the average age of a tech startup founder was 39, and there were twice as many entrepreneurs older than 50 than younger than 25, according to the Kauffman Foundation. Florida could see a strong rebound in job creation if offered inducements to its retired business executives to start new companies. -- Salon: Grown-up startups – why old people make better entrepreneurs than young ones. (Annie Lowrey), 17Dec2010 >> Florida’s communities will realize more economic gain by building on its existing strengths rather than “shooting for the moon” on speculative new investment opportunities. Tampa Bay once had a flourishing financial services sector that employed some 78,000 people, paying $49,000 on average. But the growth of the sector raised concerns that the area’s economy was too dependent on banks and insurance companies, an industry that had trouble shaking its “call center image.” Biotechnology was seen as one way to diversify, and Florida’s state and local governments spent $1.5 billion on economic incentives to develop biotech clusters. These have yet to pay off economically and have little long-term prospect of matching the job creation of the financial services sector. -- TampaTribune: Is the shift in focus to biotech jobs right for Tampa? (Michael Sasso) 18Mar10 >> Florida will have little chance of breaking into the scientific big leagues by enticing prominent labs to the state with large incentives. “Cluster madness” will have only short term benefits for politicians who can claim credit for future job creation and developers who get contracts to build the lab facilities. Vivek Wadhwa, a Duke University researcher who studies trends in technology enterprises, says most successful clusters grow naturally, not through government direction. "Nearly all such clusters worldwide have failed. It takes years for this to become obvious and, by then, political leaders have moved on and real estate developers have reaped their bounties." Wadhwa thinks the better investment is small business incubators; the state’s Office of Program Policy Analysis and Government Accountability suggests seed money for biotech startups. -- Orlando Sentinel: Money -- the missing link in Florida's biotech economy (Beth Kassab), 10Oct2010; New York Times: Can public aid really help business? (Harry Hurt III), 15Nov2010; News-Press.com: Collier County a likely investor in famous lab, but will new jobs follow? (Frank Gluck), 18July2010 >> Regional efforts in economic development will shift job growth strategy away from recruiting out-of-state businesses to helping local companies grow. About 60 to 70 percent of Central Florida's job growth comes not from companies relocating to the region but from businesses already there. With unemployment over 10 percent, the public is skeptical that spending hundreds of millions of dollars to lure prominent research labs to the state is going to pay off in enough job creation to justify the cost. The national trend of “economic gardening” places special emphasis on nurturing local startups as the prime source of job growth and innovation. While existing companies were net job destroyers from 1977 to 2005, losing a million net jobs a year, new businesses in the first year added an average of 3 million jobs a year. – Kauffman Foundation: The importance of startups in job creation and job destruction. (Tim Kane), July 2010; Orlando Sentinel: New strategy for adding jobs to Orlando region -- Focus on boosting local companies, not luring others. (Sara Clarke and Mary Shanklin), 22Aug2010 >> Florida’s immigrants will be at the forefront in new business formation and job creation. Nationally, immigrants started one-quarter of all venture-backed public companies between 1990 and 2005. Immigrants also started 60 percent of new business serving local communities. This historical trend will continue, even accelerate, as immigrants continue to settle in the U.S. (The number of new citizens is more than the next nine countries put together). Immigrant populations will constitute domestic “emerging” markets which already accounts for one-fourth of all U.S. consumer spending. Non-natives will also continue to rise to top management positions in U.S. multinationals, giving these companies a competitive edge in understanding global markets, compared to rivals with less culturally diverse leadership. -- New Geography: America’s 21st century business model. (Joel Kotkin), 31August2010; Slate: Economists are making the case politicians are afraid to -- immigration is great for the U.S. (James Ledbetter), 02Sept2010 >> Innovations will lead to more exports will lead to higher wages for workers. The U.S. metropolitan areas with the highest rates of innovation (as measured by the number of patens issued per workers) are also the most export-oriented, and companies that export pay comparatively high wages -- regardless of workers’ education levels. Wichita, for example, doubled its exports between 2003 and 2008 by nurturing its cluster of aviation companies through “angels” tax credits for venture capital investments in innovative startups. Financial backing for innovation, infrastructure and education will fundamentally improve the competitiveness of Florida’s businesses. - Brookings Institution: Five myths about U.S. exports (Bruce Katz), 05Sept2010 >> Miami will attract the innovation and wealth that tends to gravitate to well-connected "global cities". Much of Miami's remarkable economic and demographic growth is the result of its role as the primary economic and cultural bridge between the Caribbean and Latin America. Cities that are part of an economic network are able to exploit economies of scale, pool resources, improve efficiency, and gain a competitive advantage over less well-connected cities. Florida's high speed rail will expand Miami's cultural and economic network to include the universities, incubators and high tech companies that cluster around Tampa and Orlando. -- Financial Times: High speed trains will transform Europe. (Simon Kuper), 26/27June2010; New Geography: Cities -- size does not matter much anymore. (Zachary Neal), 08Sept2010 |
Economic Policy and Politics |