How our cities and communities will recover post-COVID-19 is obviously a hot topic. Because ESI and our Senior Advisors have such a wide range of expertise, we wanted to give them a chance to share their perspectives on economic development initiatives and strategies. Participating in this Q&A is ESI’s Senior Vice President and Principal Gina Lavery, along with Senior Advisors Ben Craig, Bernadine Hawes, Catherine Timko, and Fred Dedrick.
Gina Lavery: To kick things off, let’s talk about data. There’s a lot of real-time data right now related to the economy. What are some resources and/or datasets that you’re looking at or have found interesting related to economic challenges/recovery?
Ben Craig: For me, the most obvious datasets that are telltale signals of the economic toll of the pandemic are commercial real estate rent delinquency figures, mall occupancy rates, and – one least talked about- personal consumer debt data, all of which are troubling. Not surprisingly, except in scale, the global stock markets seem even less correlated with the overall US economy, at least as it relates to the economic health of the average American citizen-consumer.
Lavery: That’s right. We’ve also noticed a lot of datasets available for the first time: you can now look to apps like Open Table and Yelp to identify trends in dining and shifts in business hours. Consumer spending data is a huge market of how hard hit the economy was with all the closures. There’s an immediate need to support our cities’ retail and restaurant businesses. How should cities and business districts plan to support retail as a part of their recovery strategy?
Catherine Timko: It’s the 3 C’s: Collaborate, Creative solutions, and Communicate: Now more than ever, it’s imperative that city leaders be flexible and view commerce from the eyes of their businesses. For some, that means implementing uncomfortable creative solutions that push the boundaries– such as sidewalk dining, parklets, etc. It’s important for cities and districts to be both a champion and an advocate; this includes leveraging their marketing platforms to promote their businesses – providing a voice and a presence that is often far more extensive than any one business owner’s, even in dealing with regulatory agencies such as liquor control boards.
Lavery: What cities/districts/states are getting it right in terms of programs/resources/strategies that support their downtowns/town centers?
Timko: “Streateries” – like enclosed streets with extended dining/seating areas have proven to be a very popular approach to expand restaurant footprints while inside dining is limited (Philadelphia, Washington, DC, Frederick, MD, Media, PA to name a few). The majority of consumers in a recent survey revealed that they are more comfortable with dining outside. Liquor control boards have been amenable to working with restaurants on solutions. Where feasible, many communities and states are offering grants and low-interest loans for working capital and operating expenses, even rent. Cleveland, OH, and Williamsburg, VA have launched some interesting measures, as have larger cities such as Philadelphia and DC. Though small, many cities are waiving filing fees and reporting fees. Collaborative efforts to drive traffic to business districts are also emerging – from drive-in movies with specials meals being offered to moviegoers to virtual concerts and staged productions in the street. Gift card programs are also popular to drive traffic; some municipalities are buying gift cards for local businesses and giving them away, while others offer discounts. Typically, gift cards generate 1.5 – 3 dollars in value for a business over the value of the card.
Lavery: Looking ahead how can cities and states reposition their economies to be ready for growth when we’re past the pandemic?
Bernadine Hawes: Clearly, there will be a need for a strong, highly-focused economic development plan once we are past the pandemic. I see the focus as two-fold: first, cities and states such as Philadelphia have to map their social capital: which demographic remained, which left, what are the significant changes. For cities, social capital is key. Here is where you will find those who most likely can contribute to resilience and recovery. But it’s important to realize that resilience and recovery are only going to come through fragmenting these business sectors and boring down for where there is resiliency. It could be in a process, in a design, or even in an array of skills. Whole economic sectors don’t go away; they tend to meld and morph into a “future state” which might take years or decades before we understand the change. Cities will need to recognize this quickly and should be doing this now by surveying their business sectors.
Lavery: Are there any specific sectors that you think cities like Philadelphia should be investing in?
Hawes: One sector I see as continuing to morph into yet another future state is the manufacturing sector. We know that Manufacturing 4.0 or as some call it, Industry 4.0, where technology has melded our physical environment to cyber, sensors, etc., has been revolutionizing. Think of all the ways manufacturing will further change post-pandemic when you can make products from home just as many of us worked from home during the pandemic.
Lavery: From a workforce development perspective, how can cities and states reposition to get people back to work?
Fred Dedrick: Any suggestions here must be informed by local conversations and conditions. My opinion is that significant investments should be made to create and/or subsidize jobs that will help address the major pandemic conditions holding back the economy. This is not the time to prioritize training in general skills but instead to work very closely with city, county, and state health authorities as well as philanthropy to invest in “economy-boosting” jobs needed for recovery:
- Prioritize assistance to service providers of the elderly and young: Subsidize and/or supplement workers at nursing homes and childcare centers, making sure that there are more than sufficient personnel to address the needs of the residents and children. Very high priority.
- Contact Tracers and Outreach Workers: Hire contact tracers and neighborhood ambassadors to distribute masks, disinfectants, literature to neighborhoods across the city. Hire neighborhood residents who can call on neighbors, identify those in need, make referrals, distribute literature, etc.
- Teachers, school nurses, cleaners, temp takers, contact tracers, medical assistants, school aides: These jobs are essential for public schools so teachers can return to teaching students in the classroom. Bulk up the schools with personnel who can support re-opening. Parents can’t work if they must be at home with their children. Teachers must be in the classroom with their students.
- Subsidize small business employees as monitors, temp takers, cleaners: Provide support to any small business that wants to open up with personnel that can make customers feel more comfortable.
- Subsidize specific on-the-job training that leads to good jobs and careers. Provide wage subsidies to those employers providing training and the promise of employment.
- Insist that all employers receiving public or philanthropic support provide family-sustaining wages, equity-based hiring, and safe working conditions.
- Create a “Recover” task force to plan the next phase and make transparent where the pathways are to higher-wage careers from service jobs that will eventually be phased out.
Lavery: From your perspective, what economic development initiatives/reforms should cities and states prioritize to ensure an equitable recovery post-COVID?
Craig: The federal government has a well-developed toolkit to promote post-pandemic economic recovery that includes equity as a key goal. First, focused infrastructure investment, with prioritization towards the needs of underserved communities, will create job/investment opportunities in communities long neglected. Second, continued programs incentivizing on-shoring of key industries should be enhanced. Last, the federal government should catalyze public/private fund creation to invest — principally as long-term/low-interest loans — in seed rounds for small business creation, focusing on ventures in underserved communities, to underrepresented demographic groups and geographies especially hard hit by the pandemic.
Hawes: I believe that manufacturing is a key sector for focused concentration during recovery. The pandemic highlighted how these firms could quickly pivot from producing their core product to producing PPE; how they could aggregate the supply chain and collaborate with each other. But post-pandemic, most of these companies will be returning to their core products and services. This creates the opportunity to stimulate a small robust manufacturing sector – not simply makers – but manufacturing firms which can grow and create well-paying jobs. Cities can look for ways to provide manufacturers returning to their original, core products and services with incentives to spin-off their “pivot” and help grow a manufacturing sector of minority-owned businesses. When taken together, these activities can make us more resilient and give us a glimpse into future recovery.
Dedrick: Most importantly, cities and states should develop a series of strategies informed by qualitative and quantitative information coming directly from workforce development professionals in the field, employers of all sizes, chambers, community organizations, educators, and workers/job seekers. It is imperative that all initiatives be based on the facts on the ground as well as on a deep commitment to equity, inclusion, and job quality. Ideally, the strategies would be categorized in three steps, with timing based on local conditions and the shifting spread of infections: Reopen, Recover, and Renaissance
Prioritize jobs where people of color are working and insist/require higher wages and safer working conditions. Provide training support to help strengthen skills; nursing homes and daycare centers are a good start. But in many cities, it’s also government employment that has high numbers of good jobs for black and brown men and women: transportation sanitation, healthcare, recreation aides, fire, and police departments. People who receive wages that barely pay the bills will not help the economy recover. States, cities, nonprofits, and companies must not only pay their employees good wages but insist that their suppliers, vendors, and contractors also pay good wages. We cannot grow the economy with financial insecurity, looming rent and mortgage foreclosures, and bankruptcies.
Lavery: How can we integrate goals of equity and inclusion into our cities’ and corridors’ recovery strategies?
Timko: Historically, whenever there is an economic downturn, entrepreneurship rises. Many communities and business districts are facing unprecedented vacancies. Experts expect commercial rents to come down which may open up opportunities for entrepreneurs, including first-time business owners. Now is a good time to examine and perhaps restructure financing programs to be more relevant for start-ups and entrepreneurs and communities that are often left out – i.e women and minorities. Marketing and business assistance initiatives are critical to support small businesses, and I am witnessing many community leaders are using the pandemic as an opportunity to become mentors and share essential knowledge and information. Collaborative marketing and recruitment efforts are emerging with a focus on diversity. The Washington DC Economic Partnership just held a series of webinars on retail with a diverse range of speakers. The Riddle Company is working with the Delaware Prosperity Partnership to host a 3-part series on retail that will cover a range of topics from relevant trends to best practices and tools. Now is an ideal time to share them as we are all in this together #WAAITT
Hawes: The single most important issue with equitable recovery in cities and on our corridors is the lack of land ownership. Cities should create retail land trusts for communities, especially for black and brown communities. By creating a land trust for corridors, small businesses would have an opportunity to start, grow and if they fail, that space remains available for the next business. Is this sticky and slippery? Of course, it is. How the “retail land trust” is designed in terms of participation will be critical. It must be inclusive and legal. In addition, I see a clear role for cities to provide nonprofit organizations, business associations, chambers, etc. with mentoring services or any mentoring program. CDFIs could make manufacturing a sector receiving critical financial capital. If designed properly as I had mentioned, this is one way of baking-in accountability.
Meet the Authors
Gina Lavery is Senior Vice President and Principal of Econsult Solutions, Inc. (ESI). Ms. Lavery has led a range of projects for ESI, primarily focused on urban planning, real estate, transportation, higher education, and public policy—particularly where these areas intersect with economic development. This work has included developing economic and fiscal impact studies to support major development projects, providing advisory services on incentive programs and public financing for private and public sectors clients across the US, and supplying market insights for clients making real estate decisions.
Benjamin Craig is a Senior Advisor to Econsult Solutions. Ben has spent the past 10 years of his career in the capital markets, principally working for American exchanges. Previously a principal/founder of Swap-Ex, a startup commodity swaps trading platform, he has worked in corporate development and strategic planning roles that involved equity and derivatives exchanges, as well as commodity trading platforms and clearinghouses.
Catherine Timko is the founding principal of The Riddle Company, a Washington DC based economic development marketing firm, as well as a senior advisor at Econsult Solutions. The Riddle Company works with communities and companies across North America and positions them to effectively compete. Projects range from strategic business and marketing planning to positioning and business development strategies.
Bernadine Hawes is an executive level, nonprofit professional and economic development specialist working in the areas of project management, manufacturing strategy small business growth, and workforce development. She retired as Vice President from the University City Science Center where her career spanned over 25years in the areas programming large-scale databases, research and analysis, and incubating more than 100 information technology and biotech start-ups.
Fred Dedrick has more than 40 years of experience in organizing community initiatives to address economic and workforce development challenges. Most recently, he served as President and CEO of the National Fund for Workforce Solutions from 2010 to 2020. The Fund, with substantial investments from major national foundations, operates across more than 30 communities in 25 states, promoting workers to secure good jobs, advocating for systems reform, and addressing racial inequities.