Twin Cities Development Efforts Draw National Notice
The Twin Cities drew notice in a new report on rethinking economic development from the Washington D.C.-based Brookings Institution. The report, “Remaking Economic Development” was released on Monday.
The Brookings report argues that traditional economic development too often centers on simply drawing new companies to an area. The Brookings report notes: “Conventional economic development remains largely misaligned to what matters. It favors recruiting new firms over helping existing firms become more productive and expand. It relies too often on taxpayer-funded incentives geared to one-time job creation, rather than positioning industries and assets for long-term growth.”
The Brookings study, from its Metropolitan Policy Program, makes the case for broadening the goals of economic development programs, while also making them more inclusive.
According to the report: “A case study of Minneapolis-St. Paul shows the evolution of its significant capacity for civic leadership and the widening circle of partners involved to focus on making it more equitable and inclusive. Over the last decade, major stakeholder groups in different configurations have built stronger regional collaboration, founding a new economic development entity, Greater MSP; piloting new approaches to skills building; and coming together to ensure that transit-oriented development benefited low-income communities.”
In addition to Greater MSP, the Brookings report mentions the Itasca Project and Minneapolis-based Northside Funders Group. The Itasca Project is a local group of business leaders that largely works behind the scenes on policy issues; Northside Funders Group is working to better coordinate the $15 million to $20 million that local nonprofits donate annually to north Minneapolis programs with a goal of making the grants more effective in the community.
“I think that the work that’s being done in the Greater MSP region is moving in the right direction,” said Amy Liu, vice president with the Brookings Institution and Director of its Metropolitan Policy Program, who wrote the new report.
But while Liu is encouraged by efforts underway in the Minneapolis-St. Paul area, she says that challenges remain. She notes that despite broader economic improvement, the poverty rate is on the increase in the Twin Cities.
“I think that poverty has increased everywhere across the country…it’s not unique to the Minneapolis St. Paul region,” Liu said.
Twin Cities Business recently looked at longstanding challenges for drawing new development to north Minneapolis, which has been the toughest part of the metro to attract new business and projects. Liu said that the Brookings report did not specifically look at north Minneapolis; the report did not analyze metro areas at the neighborhood level.
But the report concludes that addressing economic racial disparities are a key part of remaking economic development programs: “Finally, an explicit and deliberate focus on rectifying disparities by race and place is not a social agenda but an economic imperative to boosting productivity, improving regional incomes, and sustaining long-term growth.”