Lessons From a Tough Ten Years

Youreconomy.org is a great tool from the Edward Lowe Foundation to analyze economic development data over a period of time.  This isn't just sampling data like the government gives us with unemployment rates and the like.  This is real data from databases on every company in the Dun & Bradstreet database.

Their tool shows Licking County, much like all of Ohio, had a rough ten years between 2000 and 2009, the last year of the data.

There are lessons to be learned though.

Licking County lost 5,298 jobs from 2000 to 2009.  It would have been doubly worse, according to the report, had existing companies not added 5,700 jobs during the same time.

Big corporations didn't hold the answer.  Licking County dropped to just six employers with 500 or more employees, down from 12 such companies in 1998.

Small companies didn't hold the answer either though.  Though the number of companies with 2-9 employees accounted for 50% of Licking County companies, they only produced 20% of our jobs.

Companies with 10-99 employees accounted for just 7% of the establishments but produced 22% of the jobs.  Though still hit by job loss, this grouping of companies had a lower percentage job loss and was the only grouping that didn't suffer sales losses during this tough ten-year period.

In fact, over the past 15 years in Licking County, it's been these size of companies that added over 1,000 jobs while larger-sized companies lost 8,000 during the same time period.

So, what's the lessons?

Focus on existing companies, after all, they are already here.  Though relocating companies bring the greater headlines and brought a net 280 new jobs during these ten years, it's still evident that Licking County benefits from job growth among it's existing companies most of all.

Focus on "second-stage" companies.  The small companies in the 10-99 employee range provide the greatest promise, the greatest bang for the buck. 

The Edward Lowe Foundation calls them "second-stage" as, nationally, these are the 13% of companies providing 42% of jobs.  These are existing companies, rooted in the community, that have grown once already and, with some focused resources, can become even stronger job-creators in the future.

Here's the report print out.  See if you agree.