Cross-posted from The Herald-Times, April 24, 2020
Amid this global uncertainty, many are wondering how we can rebuild our economy. We have pressing short-term priorities from the COVID-19 crisis, and we also have long-term needs. A hundred years ago, we manufactured furniture. Fifty years ago, we manufactured TVs and refrigerators. But we don’t build those things anymore and those companies – and the thousands of jobs that allowed families to thrive – left Bloomington. Job creation is more important now than ever.
Opportunity is still out there if we seek it strategically. Bloomington can and should create a new economic identity that targets an industry aligned with global trends, and we can ride that wave of growth to a new era of prosperity. But we have to focus.
A focused economic identity makes it easier to attract and retain talent. Talented people go where they know they’ll find good jobs, and companies need talent to grow. We have a powerful renewable source of talent, a world-class research university that migrates in 16,000 students annually from around the globe. Focus keeps more of the best and brightest here.
Ecosystems of companies develop around focused talent clusters. Look at how Cook Group built Cook Pharmica and sold it for $1 billion to Catalent. They then pledged to spend $100 million in a local expansion and create 200 jobs.
The kind of jobs we focus on matters. Innovation-driven jobs catalyze the economy as a whole. According to “The New Geography of Jobs,” every innovation-driven job creates five non-tradeable jobs (two professional and three service) with higher-than-average wages. A rising tide lifts all boats.
So what industry should we target? It should be one that we’re already doing to a degree, so we can double down on what works for us. It should be an industry where Bloomington has a competitive edge. And it should provide high-wage jobs our community needs and deserves … and a lot of them.
Bloomington is home to some great software companies, such as Cornerstone and Envisage. Software is eating the world, so software companies will continue to proliferate. Unfortunately, Bloomington doesn’t have any competitive advantages in this industry. We don’t have more developers per capita than other cities, for example.
We love food here, which usually comes in the forms of independent restaurants and the farmers’ market. While these groups bring in some money from outside the community, they primarily circulate money within the community. This is absolutely needed for a healthy economy, but it’s not the high-growth driver we’re looking for.
A handful of agencies have global reach, such as Rock Paper Scissors, Convince and Convert, and Hanapin (whose new owner is shifting operations from Austin). These are people-based companies, and they thrive here because we have more educated people per capita than other cities of our size. In fact, Bloomberg ranks us first in Indiana and 31st in the nation. From experience though, people-based businesses are inherently hard to scale.
Why not medical devices or life sciences? Cook is proof that a singular focus can help an entire community. Cook, Catalent, Baxter and Singota teem with talent. We have unique resources like the Indiana Center for the Life Sciences. This industry brings in money from outside the community. Unfortunately, these types of companies are capital-intensive with long timelines. It can take a decade and millions of dollars just to discover whether an idea is viable, much less build a business.
One industry that checks all boxes is cybersecurity. Focusing on cybersecurity will put the wind at our backs. It is a growing industry. Analysts predict the federal government alone will increase purchases of information security products and services by $3 billion by 2023. Cybersecurity is also starved for talent. Unfilled cybersecurity jobs are expected to reach 1.8 million by 2022. Cybersecurity brings in capital from outside the community, as sales and support of the product are virtual. It is also scalable, because it is software-based. And finally, because it is innovation-based, it creates those five jobs for each cybersecurity job.
We already have a few cybersecurity companies here: Synopsys, Warrant Technologies and CACI. We’re educating the next generation of talent: Indiana University is building a world-class curriculum in cybersecurity, and Ivy Tech Community College offers an 11-month educational path to jobs that earn $60,000-$75,000 per year. We have enviable geographic advantages. Muscatatuck Urban Training Center – literally the only center in the world like it – is just 90 minutes away. Crane Naval Surface Warfare Center, the world’s third largest naval warfare base, lies 30 miles to the south.
The Mill has current and future initiatives to grow our cybersecurity ecosystem:
• Pairing MBA students at IU’s Kelley School of Business with IP creators at Crane to found new companies.
• Helping Ivy Tech market their cybersecurity program at Muscatatuck.
• Leveraging programs like Firestarter at [email protected] to identify ideas with good business models.
• Partnering with the Indiana Defense Entrepreneurs Forum to host events at The Mill.
In doing so, we help fulfill The Mill’s mission of launching and accelerating high-potential companies and our vision of becoming the center of coworking and entrepreneurship in Indiana. And with collaboration across our region, and a shared focus on a new economic identity and cybersecurity, we can accomplish even more, together.
Pat East is executive director of The Mill. Next week, Bloomington’s Talisha Coppock will share her views.