Renew city’s promise

Wichita State University’s innovation initiative involves both revolutionizing its education products and developing the Innovation Campus as the hub of an innovation district.

If this initiative is successful, it will create global demand for goods and services from our area, resulting in increased employment, reputation, industry diversification and wealth generation.

The New York Times carried a feature article on universities involved in innovation. Wichita State, and therefore Wichita and south-central Kansas, were discussed nationally in the same breath as Stanford and Cornell.

As WSU’s initiative develops, the prospect exists for historically unprecedented positive business spillovers for this region, boosting the performance of existing firms while attracting new ones.

Realizing these benefits, however, will require the adoption of a new approach to economic development in our region. This is evident from the disappointing results of Wichita’s pursuit of what might be called the more traditional economic development model, one that seeks to induce firms and jobs to locate in specific areas or that focuses on incentives to encourage specific companies to relocate to the city.

The data show this approach hasn’t worked. Urban analyst James Chung recently observed that Wichita is losing educated workers at an alarming rate: They are our second largest export after aircraft.

Data from the Brookings Institution are even more distressing: Wichita’s job growth performance is ranked 98th out of the top 100 metropolitan areas, and it is only one of two metro areas in the U.S. to continue to lose jobs between 2009 and 2014.

All of this is especially disconcerting given that Wichita starts with considerable assets in capable workers, intellectual capital and advanced manufacturing facilities that could be leveraged to create economic advantage. For the most part, current economic development models fail to build on these considerable assets, and our metropolitan area is losing ground in a significant manner that, if not reversed, will lead to longer-term economic stagnation.

Despite our concentration of technology-based jobs, Wichita is the only major metropolitan area in the central Midwest to lose technology-based workers as a percentage of the workforce between 2013 and 2015.

It is important that Wichita recognizes what most cities around the country have come to understand: Reasonable returns on public investment will require new approaches to economic development. Older models of economic development built on the assumption that targeted public investment in preselected business locations have proven to be cost ineffective strategies that are increasingly politically unpopular.

Taxpayers are disenchanted with development models that require substantial investment of public resources in the form of direct subsidies or infrastructure investments applied to specific parcels of land or business sites with benefits that are narrowly accrued.

In contrast, similar levels of investment that are consistent and congruent with actual market trends are likely to produce higher returns on that investment for the city as a whole. In other words, newer approaches to economic development, assuming similar levels of public investment, are more likely to yield acceptable returns, and these returns are more likely to be realized by the broader community in the form of a vibrant economy driven by powerful market forces. These forms of economic development are much more politically palatable.

This story was originally published September 25, 2016 at 5:04 AM with the headline "Renew city’s promise."