Economic Development: Does It Add Up?

Maybe it’s me, but it just doesn’t add up.  What I’m referring to is our Regional Economic Development Council (REDC).  I was never good at math, but I can do arithmetic. In the 2017 Progress Report for our REDC (Pg. #20) there are two tables.  Using these tables I found the following: In the six years between 2011 and 2016 we committed $276,028,945 of State funding. Based on this investment, we created 2,219 jobs.  If I simply divide the number of jobs created by the dollars invested, that is $124,393.40 per job.

If I look at this differently, these tables also show how these State dollars leveraged private investment.  These leveraged funds generated 460 projects totaling $1.444 billion.  It also quantifies the number of jobs retained by these investments (16,077).    So the total number of jobs created and retained is 18,296. This arithmetic ($1.444 billion divided by 18,296 jobs) yields a cost per job of $78,847.56. Does that seem high to you?  It does to me!

Now here is my problem.  In a recent needs assessment commissioned by the Community Foundation of South Central NY (Oct. 2015) and prepared by Horn Research LLC revealed the following: Of the five counties surveyed (Broome, Chenango, Delaware, Otsego and Tioga) Broome County had the highest number of people living in poverty 17.4%. This is an increase from 2000, when it was 12.8%. It is worth noting that the Statewide Poverty Rate is 15.6% and the National Poverty Rate in 2016 was 12.7% (US Census Bureau).  Of those living in poverty, children are the largest affected population. In Broome Co. 25.3% of children (under 18) live in poverty.  This is an increase from 2000 when the number was 15.9%. Coupled with this, pockets of high childhood poverty exist. In the City of Binghamton 47.3% of our children live in poverty.

Now, if we consider those living above the poverty level, but not making anything near the “Household Survival Budget” (United Way) the picture is even bleaker.  United Way has coined a new acronym, ALICE (Asset Limited, Income Constrained, Employed).  These are folks who make more than the US Poverty Level ($11,670 for an individual and $23,850 for a family of four).  The Household Survival Budget reflects a need of $19,380 for individuals and $56,964 for a family of four.  In Broome County these ALICE individuals represent 26% of our population. So if we combine those living in poverty (17.4%) and the ALICE population (26%) approximately 43% of Broome Co. residents are struggling to survive.

We need jobs!  We need gainful and meaningful employment.  To achieve this we need a real dialogue among all concerned stakeholders.  This would be similar to the recent collaborative efforts to address our Opiod crisis.  We need a new approach to how we do economic development, including who should be at the table.  Clearly the numbers do not add up!

by Mark D. Bowers



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