As the U.S. skilled labor supply continues to tighten, economic development groups are finding it increasingly difficult to show site selectors and businesses what they want to see: the availability of skilled workers.
The following case study demonstrates how, with the right data and collaboration, small towns in rural America can compete (and win) in the global economy.
When the Belgian high-tech materials company Umicore decided to expand its germanium wafer1 production to the U.S., its search led it to three cities: Phoenix, Albuquerque and, Quapaw, Okla. With a population of 966 residents, Quapaw is a tiny town, located “off the beaten path” as they say, near the Ottawa county seat of Miami (population: 14,485). Umicore’s Opticals division has an existing plant in Quapaw, so it knew the cost of business would be low; however, the company needed proof that the surrounding region could provide the necessary workforce for the new plant.
When the site selector approached Judee Snodderly, executive director of the Miami Area Economic Development Service, with very specific questions about the regional workforce, Oklahoma’s public data did not have the sufficient details or flexibility necessary to answer the site selector’s questions.To complicate matters, the Miami regional labor force is shared by four states, which meant Snodderly would have to dig through three more public data websites.2
Painting an accurate picture of the regional workforce required gathering data from each state’s LMI site. When these data sources did not have the necessary information, Snodderly began making phone calls to the neighboring states’ economic development groups. Anticipating a long road of data gathering ahead, Snodderly grew concerned about her ability to field the questions in a timely manner. The need for detailed regional data was urgent, and if she couldn’t provide it, Umicore – and the jobs it would provide – would locate elsewhere.
Oklahoma, Kansas, Missouri and Arkansas form the only four-state WIRED region in the U.S. Due to this fact, Snodderly was able to draw upon a diverse array of experience, expertise, and resources. The search for workforce information led her to Gary Box, the business retention coordinator at the Workforce Investment Board of Southwest Missouri.
Box said he could easily provide the workforce data on Missouri and the three adjoining states, thanks to EMSI’s web-based labor market tool, Analyst. With this tool, Box quickly answered the site selector’s questions by providing two crucial reports: detailed industry and workforce characteristics, and custom industry and occupation reports highlighting the high-tech manufacturing capabilities of the four-state region at the county level.
Furthermore, Box also had the foresight to include information pertaining to the skills and availability of workers from other highly compatible occupations in which Umicore might be interested.
This analysis not only provided Umicore and its site selector with the basic information they were looking for; it also provided the company with a more complete and holistic look at the actual industry and workforce cluster and how it could benefit from it.
In reference to his report, Box says, “It’s important to tailor the data to the audience. EMSI gives me the flexibility to find the detailed industry and occupation data I need, but then I have to use my own common sense to figure out what the site selector needs to see.”
In late June 2008, Umicore chose Quapaw as the new location for its germanium wafer production site, resulting in an investment of $51 million into the region and 165 new jobs with an average salary of $51,000 a year not including benefits. Construction began in 2008 and continued through late 2009. EMSI estimates that the total impact on the economy of Ottawa County during the construction phase alone was more than 160 jobs and nearly $9 million in earnings annually. Once the plant began operating, that impact rose to more than 250 jobs and more than $12 million in earnings annually.3
“Having the data made all the difference,” said Judee Snodderly of the role that regional collaboration and data played in their success. “Workforce availability was number one on the site selector’s list, but without the detailed data, we would have had no way of proving that our regional workforce is sufficiently skilled and available.”
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- The primary semiconductor component of high-efficiency solar cells.
- Miami sits in the northeast corner of Oklahoma, which adjoins Kansas, Missouri, and Arkansas.
- Operations-phase impacts include the “direct” jobs and earnings at the plant itself, plus indirect and induced effects. Numbers are initial estimates only and should not be interpreted as the result of a thorough impact study. Source: initial input/output analysis by EMSI assuming (1) about $30 million in sales for industrial building contractors over 1.5 years during the construction phase, (2) 165 new jobs in “semiconductor and related device manufacturing” during normal plant operations thereafter, with those jobs having $60,000 average annual earnings including benefits, and (3) only 5% of the plant’s profits remaining in the county. These are rough, preliminary assumptions made entirely by EMSI and are not based on any additional information from Umicore or local governments/organizations involved.
*This post original appeared on the EMSI blog on September 24th, 2008.Related
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