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Who will recover first, i.e., if I had to move somewhere, where would that be?

December 20, 2010

What States will recover first? What States will have the most jobs created? Which States will have the highest average wages?  If I could move, where would I want to live? If I was opening a new plant or company, where would I find the most talent skilled in high-tech and high value-added manufacturing?

We pulled some data from the Kaufman Foundation, a think tank focusing on entrepreneurship and several sorts later, came upon some interesting results.

The mainstream media talks about creating jobs on a national level but a job is not a job.  High value-added manufacturing jobs pay more to the average worker and are more numerous than typical service jobs, sky high Wall Street bonuses paid to a select few none withstanding.  So which States have the highest concentration of well paying manufacturing jobs?

Washington
Connecticut
Arizona
Nevada
Delaware
Louisiana
Maryland
Massachusetts
Indiana
Texas

It stands to reason the States with the greatest ability to attract workers (including technicians and if you‘ve been to a factory recently, many of the workers you saw are actually skilled and well paid technicians operating or maintaining sophisticated equipment) would include many of the same States and so the results of that sort are not too surprising:

Massachusetts
Vermont
Connecticut
Hawaii
Maryland
Virginia
North Dakota
Rhode Island
Maine
New Hampshire

In our globalized world, the best companies are able to successfully compete on the world’s economy stage and the States with those companies, the States with the fastest growing companies are:

Massachusetts
Virginia
Utah
Maryland
Connecticut
New Jersey
California
Texas
Georgia
Washington

By now you can see the trend – some States, most notably Massachusetts and Texas are emerging as leading the rebound.  In fact, Texas never really had much of a recession to begin with.

Now it gets interesting.  Overseas populations have a word of mouth social network focused on to what States should they migrate. Sometimes it’s based on established ethnic communities, but at the end of the day, you have to get a job. The sort was surprising, although Hawaii seems like a great place to live:

North Dakota
New Hampshire
Montana
Missouri
Kansas
Maine
Hawaii
Vermont
Ohio
Maryland

So, in the end, which States will, overall, lead the charge?

Massachusetts
Virginia
Utah
Maryland
Connecticut
New Jersey
California
Texas
Georgia

We had to ask – which States will be the laggards?

Wyoming
South Dakota
Rhode Island
Alaska
Arkansas
Kentucky
Hawaii
Louisiana
Idaho
New Mexico

And which are sort of neither here nor there, stuck between being on the uptick and wallowing along?

West Virginia
Kansas
Ohio
Florida
Indiana
Tennessee
Minnesota
South Carolina
Oregon
Nevada

Can a State empty out with a large percent’s of its population moving to more prosperous locales?  As a result of the 2010 census, some congressional seats can be adjusted based on population increases/declines.  Texas, our #8 State ‘leading the charge’ can qualify for 4 more seats while Ohio, part of our stuck in the middle group, will most likely lose 2, the largest single drop along with New York. For those who don’t know NY, it’s 2 States rolled into one border. Downstate is Medical, Financial Services and media, all rapidly recovering, or even having their best years while Upstate is unemployment, rust belt, prisons and colleges (which is ironic since it’s a very conservative area, but not conservative enough for them to not work in public sector jobs).  States are living creatures, some thriving, some just getting by.

On Sunday the juxtaposition gods struck again.  In the morning, NPR reported how the incoming Governor of, you guessed it, Ohio, said he didn’t want the new high-speed rail project, even with Federal funds.  So much for being committed to advanced infrastructure requisite to attract new businesses and well-paying long duration jobs, such as building high tech railcars.  Then later that evening, the Travel Channel had a piece on waterparks and one of the best was in Ohio. Sounds great, except the average employee looked like a member of the High School swim team, not someone trying to support themselves or advance a career/job path.

This morning, the NY Times has a front page above the fold article (see I’m old enough to relate to the paper edition) stating many new jobs are temporary, designed to reduce costs for benefits, etc.  How many?  ‘Since the beginning of the year, employers have added a net 307,000 temporary workers, more than a quarter of the 1.17 million private sector jobs added in total’ which is great for companies, but not for careers, communities, States or the social fabric. And the screamed about all over TV 50,000 private sector jobs added in November? As you would expect, 80% are temporary and January, as of this writing, is just 12 days away.

So in this age of partisan politics and ‘gottacha’ State legislatures, I strongly recommend the laggards and the middle rankers put it all aside and develop reasons to attract capital, high value added jobs and companies able to compete at the Global level.  Quick action in education grants to State University systems for math and science/engineering 2 and 4 year programs, subsidizing internships at private companies, grants to open new companies and an excellent infrastructure as well as working cooperatively with local utilities can make all the difference and are locally (not Washington, DC) controlled.

As long as we don’t have a national industrial policy, each State should develop one of their own, properly titled ‘Survival Plan’. Has this been tried before? In the US no, but Israel has had great success even with their limited financial resources and small population.  As was recently reported in the UK newspaper The Daily Mail’s online edition:

‘The warm and fertile coastal plain between Tel Aviv and Haifa is Israel’s silicon valley, something close to an ideal environment for hi-tech start-ups. Scattered along its length is a series of science and business parks, places where entrepreneurs and academic experts can work together, often with direct sponsorship from the state. Israel’s ‘incubator’ system allows small firms to receive up to 80 per cent of the funding they need to develop new products from the office of the government’s chief scientist, with no strings attached.’

Question #1 – How many US States have a Chief Scientist?  Question # 2 – How many States have a Chief Lobbyist?  Question #3 – Which would better steer a State’s leadership?

Rich Eichen is the Founder and a Managing Principal of Return on Efficiency, LLC, who’s website is http://www.growroe.com and is one of their senior turnaround leaders/CROs, Program and Interim Executives with over 25 years’ experience reshaping companies, Operations, IT and key initiatives. He can be reached at richard.eichen@growroe.com

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