©2007 vital economy, inc. 1 southern illinois: garden of the gods readiness assessment chapter 1:...
TRANSCRIPT
©2007 ViTAL Economy, Inc.— 1 —
Southern Illinois: Garden of the Gods
Readiness Assessment
Chapter 1: State, National & Global Trends
December 18, 2007; revised Feb 15, 2008
CONNECT SI
ViTAL Economy AllianceFrank Knott, Project Lead; Stan Halle, Senior Editor;
Jim Haguewood, Rob Beynon, & Neil Gamroth, Principal Economic Researchers
[email protected]; http://www.vitaleconomy.com
©2007 ViTAL Economy, Inc.— 2 —
1.01 Globalization: The World is
Flat
1.02 eCommerce & Connectivity
1.03 KBE and Innovation
1.04 Transformation of U.S.
Economy
1.05 Livable Communities & Age
of Choice
1.06 Manpower & Immigration
1.07 Aging Population
1.08 Tourism
1.09 Logistics, Transportation &
Distribution
1.10 Energy
1.11 Conclusions
Table of Contents EXECUTIVE OVERVIEW:EXECUTIVE OVERVIEW: the Big Picture & the Big Picture &
Importance of Change in Southern IllinoisImportance of Change in Southern Illinois
READINESS ASSESSMENT (RA)READINESS ASSESSMENT (RA)
1. 1. State, National & Global TrendsState, National & Global Trends
2. Indigenous Resources & Industry Asset Mapping
3. Enabling Environment
4. Climate of Innovation, Incubation & Entrepreneurship
5. Southern Illinois Competitiveness
6. Regional Perspectives
7. Roadmap to Success
APPENDICES
©2007 ViTAL Economy, Inc.— 3 —
Chapter 1:State, National & Global Trends
1.01 Globalization: The World is Flat …….. 5
1.02 eCommerce & Connectivity ………… 16
1.03 KBE and Innovation ………………….. 26
1.04 Transformation of U.S. Economy …… 39
1.05 Livable Communities & Age of
Choice …………………………………. 56
1.06 Manpower & Immigration ……………. 67
1.07 Aging Population …. 74
1.08 Tourism ……………. 87
1.09 Logistics, Transportation
& Distribution ..…….. 106
1.10 Energy .……………. 118
1.11 Conclusions ………. 133
Rural communities typically focus on their local geographic area and have limited insight into the larger world around them. This chapter provides key trend information and what this means
for Southern Illinois. Each of these trends represents potential opportunities for Connect SI.
Southern Illinois — "Garden of the Gods"
©2007 ViTAL Economy, Inc.— 4 —
Understanding Trends is Critical: Assumptions are Often Wrong
“I think there’s a world market for maybe five computers”
- IBM Chairman, 1943
“I think there’s a world market for maybe five computers”
- IBM Chairman, 1943
“American business must embrace globalization as the new reality or risk losing their place in the economy of the future. There are others out there willing to do the work if we aren’t.”
- - “Globalization: The New Reality” - Univ. of Wisconsin Journal Of Management In Engineering / Nov/Dec 2000
“American business must embrace globalization as the new reality or risk losing their place in the economy of the future. There are others out there willing to do the work if we aren’t.”
- - “Globalization: The New Reality” - Univ. of Wisconsin Journal Of Management In Engineering / Nov/Dec 2000
"The range of what we think and do is limited by what we fail to notice. And because we fail to notice that we fail to notice, there is little we can do to
change, until we notice how failing to notice shapes our thoughts and deeds.” - Dr. Ronald Laing, Scottish Psychiatrist & Philosopher
"The range of what we think and do is limited by what we fail to notice. And because we fail to notice that we fail to notice, there is little we can do to
change, until we notice how failing to notice shapes our thoughts and deeds.” - Dr. Ronald Laing, Scottish Psychiatrist & Philosopher
Chapter 1: Perspective
©2007 ViTAL Economy, Inc.— 5 —
Chapter 1:State, National & Global Trends
1.01 Globalization: The World is Flat
Southern Illinois — "Garden of the Gods"
Certain events, new technology and other shifts over the last two decades have fundamentally changed the rules of competition world-wide. Southern Illinois (SI) is now a virtual neighbor
with every corner of the globe — and, as such, can do business with any and all of them.
©2007 ViTAL Economy, Inc.— 6 —
Globalization: The World is Flat — Overview
Tom Friedman’s book “The World is Flat” provides many insights about how dramatically the world has changed over the last two decades
While any one of the ten (more recently eleven) flatteners could be viewed as a notable trend, it is the cumulative effect of the whole set that is truly profound
Taken together, these flatteners have opened up the world to everyone Barriers to entry have all but disappeared regarding almost any business,
particularly those knowledge-based Size doesn’t matter as much as what the Region brings to the table Combining the unique assets of a region, packaging these in a compelling
manner, using connectivity to its fullest — are the key enablers Moving goods & services has become far easier than moving people — a
Thai farmer can sell mangos to Carbondale, but may find it rather difficult to visit
1.01 Globalization: The World is Flat
Every business in the world is now competing with each other in a closer and more intimate wayEvery business in the world is now competing with each other in a closer and more intimate way
©2007 ViTAL Economy, Inc.— 7 —
Results of Not Playing on the Global Stage
SI’s economy has not achieved potential due to not effectively participating in the Global Economy
SI’s economy has not achieved potential due to not effectively participating in the Global Economy
Source: “State of Working Illinois”, by Northern Illinois University (Nov 2005); “21st Century Workforce” (May 2004); IMF
0
1
2
3
4
5
6
AAGR 1977-2001
Worldwide USA State-wide Southern Illinois
Ave
rag
e A
nn
ual
G
row
th R
ate
%
3.14%
2.19%
1.34%
5.62%
1.01 Globalization: The World is Flat
Reduction of trade barriers & increased capital investment flow internationally have fueled this dramatic growth
AAGR = Average Annual Growth Rate
©2007 ViTAL Economy, Inc.— 8 —
Ten Flatteners: Intro
Source: “The World Is Flat”, by Thomas Friedman
The following five slides explain each of the Ten Flatteners in more detail
Global unification under the auspices of capitalism
Global unification under the auspices of capitalism
Web-Browsers equals technology for grandmothers
Web-Browsers equals technology for grandmothers
Web-based standardsWeb-based standards
Self-organizing collaborative communities
(Apache, Wikipedia)
Self-organizing collaborative communities
(Apache, Wikipedia)
Turbo-charged by the
dot.com bubble
Turbo-charged by the
dot.com bubble
China joins WTO
China joins WTO
Horizontal collaboration
(Wal-Mart)
Horizontal collaboration
(Wal-Mart)
Third-party managed logistics
Third-party managed logistics
Ability to build & maintain your own
supply chain (Google)
Ability to build & maintain your own
supply chain (Google)
Computing speed,file sharing, wireless
Computing speed,file sharing, wireless
SupplyChaining
Off-Shoring
Outsourcing
Open-Sourcing
WorkflowSoftware
New Age ofConnectivity
Fall of theBerlin WallAmplifying
Technologies
Informing
Insourcing
Ten FlattenersTen Flatteners
1
2
3
4
56
7
8
9
10
1.01 Globalization: The World is Flat
©2007 ViTAL Economy, Inc.— 9 —
The World is Flat: Ten Flatteners
1. Berlin Wall Comes Down November 1989
• Millions of highly skilled engineers, scientists and technicians became available to serve the global market at bargain prices
• Human resource marketplace became global. Firms access best practice skills at competitive prices anywhere at any time. SI workforce supply chain must benchmark its performance against global best practice education & training
2. When Netscape Went Public, August 1995 from PC-Based to Internet-Based Platform
• The Internet became the medium for electronic communication. Anyone could communicate with anyone else on the planet without regard to boundaries
• Vertical, hierarchical control is gone. Geo-political boundaries became barriers to progress. The world became flat. Individuals communicating with each other, regardless of boundaries, create new ideas faster and cheaper. SI success will be directly related to how effectively it moves away from boundary-based policies and hierarchical organizational control
1.01 Globalization: The World is Flat
Source: “The World Is Flat”, by Thomas Friedman
©2007 ViTAL Economy, Inc.— 10 —
The World is Flat: Ten Flatteners
3. Workflow Software Enables a Global Supply Chain
• Workflow software seamlessly connects applications to applications, so that people can manipulate all their digitized content using their computers and the Internet — “People all over the world can now shape, design, create, buy and sell things, track inventories, prepare tax returns, read X-Rays from half a world away using a common software platform”*
• SI is competing in a world without boundaries, which uses workflow software to improve productivity and increase prosperity. SI’s economy will only be transformed when it encourages investment in workflow software to improve the efficiency and effectiveness of every citizen, business, NGO and government entity
4. Open Sourcing-Shareware
• Free tools from software (Linux) to servers (Apache) and encyclopedias (Wikepedia) enable millions of people and firms to compete with bigger organizations on a level playing field and get to market faster
• SI firms, governments, NGOs and citizens have the opportunity to leap frog traditional development timeframes and become global competitors through the savvy and effective use of Open Sourcing
1.01 Globalization: The World is Flat
Source: *“The World Is Flat”, by Thomas Friedman
©2007 ViTAL Economy, Inc.— 11 —
5. Outsourcing, Y2K, Using Telecom to Contract to Another Firm in Another Country
• Y2K proved that firms could access well developed intellectual capability in developing countries 24 hours per day without owning the capacity or reducing quality. Production is no longer limited by time or geography
• SI’s mid-U.S. location and its significant educational resources positions SI to be a potential outsourcing hub for the “Heartland of America” to the world and the world to the Heartland of America. SI collaborating with next door neighbors’ resources versus competing with them is a critical step in making Outsourcing an opportunity rather than a threat
6. Off Shoring — Moving a U.S. Operation to Another Country • All prior flatteners prepared global firms to be able to produce the same product or service in
the same way to serve local markets and expand global capacity. Off-Shoring is occurring from U.S. locations to the world and from global locations to the U.S.
• Off-Shoring is as much an opportunity as it is a threat to SI. The key is to identify those indigenous human, natural, geographic location and knowledge resources that enable SI to offer products and services to the global marketplace at higher value rather than at commodity prices
The World is Flat: Ten Flatteners1.01 Globalization: The World is Flat
Source: “The World Is Flat”, by Thomas Friedman
©2007 ViTAL Economy, Inc.— 12 —
7. Supply Chaining — Connected Throughout the Chain Without Owner Control• Elements of the supply chain from raw material to customer are connected, resulting
in on-demand production and logistics resulting in increased efficiency and lower costs (Wal-Mart, CISCO, etc)
• Effective supply chaining requires that SI know what elements already exist in the region as well as where gaps exist. There is Supply-Chaining opportunities for SI in every field of economic output (tourism, healthcare, government services, agriculture, energy, healthcare products and services, etc). Expanded markets and increased numbers of higher value jobs resulting from effective supply chaining strategies
8. In-Sourcing — UPS into Your Company• Logistic companies (UPS, FEDEX) enter into a brand new market of relieving major
product producers of non-core competencies. This results in improved quality and speed of service to the customer. It enables customers to go global faster using proven logistics resources
• SI has an opportunity to become a global logistic services hub for logistics firms because of its geographic location. SI business and government entities can identify In-Sourcing opportunities for improving customer service, quality and speed to market
The World is Flat: Ten Flatteners1.01 Globalization: The World is Flat
Source: “The World Is Flat”, by Thomas Friedman
©2007 ViTAL Economy, Inc.— 13 —
9. Informing: The Ability to Build and Deploy Your Own Personal Supply Chain — of Information, Knowledge, and Entertainment (Google, Yahoo, MSN Web Search)
• Informing is searching for knowledge, allies and collaborators and connecting them. Small and mid-sized enterprises (SMEs) are able to level the marketplace by being able to operate and present themselves as an equal to large multinational corporations
• SI businesses, governments, NGOs and citizens have the opportunity to create new services and products and reach broader local, regional, national and global markets through the use of informing technologies and strategies
10. The Steroids — Digital, Mobile, Personal and Virtual • Information and communication technology innovations have created the ability to
work from anywhere, anytime improving the speed of transactions whether we are at work, at home or on the go, whether we are wired or wireless
• SI, through Connect SI, is in the process of developing and implementing a broadband connectivity strategy that will enable all of SI to take advantage of these digital, mobile, personal and virtual steroids. Learning and adapting these technologies will be critical to SI economic transformation
The World is Flat: Ten Flatteners1.01 Globalization: The World is Flat
Source: “The World Is Flat”, by Thomas Friedman
©2007 ViTAL Economy, Inc.— 14 —
Globalization & The World is Flat:Implications
SI is competing with World-is-Flat-savvy country economic strategies SI political/jurisdictional boundaries are a competitive disadvantage Collaboration across SI assets will be required to expand SI economy Continued internal competition will relegate SI to continued decline One of the fastest growing sectors: Logistics, Transportation & Distribution
It’s changing so fast, SI better get moving
SI broadband access, penetration and usage need to be at best practice levels
SI institutions, governments, citizens and businesses must become more knowledgeable about the value and impact of web based productivity tools to take advantage of the ten flatteners for accelerated SI economic growth
World is Flat education of SI citizens needs to become a priority strategy Wired and Wireless connectivity and applications strategy is essential
Global markets are an opportunity for SI growth, not a threat to growth SI needs to expand the percentage of its economy that is globally driven A greater focus on value added KBE growth is critical to future success of SI Public policies focused on industrial attraction must be changed
1.01 Globalization: The World is Flat
©2007 ViTAL Economy, Inc.— 15 —
Globalization & The World is Flat: Opportunities
The Global Economy is growing at 4x’s the rate of SI — SI can literally double its economy by tapping into global markets, by fostering new working relationships with foreign companies that desire entrance to the U.S. market
This means jumping from 1.34% to 3.85% average annual growth rate (AAGR)
SI should use the ten flatteners as an opportunity to leverage its geographic location and inter-modal transportation and logistics assets to become a global logistics service center for In-Sourcing and Out-Sourcing
SI should leverage its significant research and development knowledge base as well as workforce education and training assets to develop a significant regional collaborative KBE and innovation growth strategy
SI has the opportunity to demonstrate to the rest of Illinois how to use the Ten Flatteners to develop a collaborative regional approach to economic development, 24x7 government services and industry cluster strategies that cross traditional political, industry and jurisdictional boundaries — building prosperity for all
1.01 Globalization: The World is Flat
©2007 ViTAL Economy, Inc.— 16 —
Chapter 1:State, National & Global Trends
1.02 Broadband Connectivity & eCommerce
Southern Illinois — "Garden of the Gods"
While the Ten Flatteners have opened up access to global markets for all, broadband connectivity is the key to getting there — market access has expanded exponentially. To take
full advantage of this growing enabler, SI must learn how to maximize its usage.
©2007 ViTAL Economy, Inc.— 17 —
Broadband Connectivity & eCommerce: Overview
Broadband connectivity is bringing the undeveloped and developing countries on even par with the industrialized nations — remoteness is now becoming an asset
Rural broadband parity with global best practice economies is as important as Rural Free Delivery was in the 19th century, electrification in the 1930’s, the Interstate in the 1960’s
Key trends to watch: Global connectivity has now put small & medium sized enterprises (SMEs) on an
equal footing with corporate giants competitively In 2006, the U.S. fell to 19th globally in household broadband penetration As of Dec 2005, 87.5% of U.S. at-work connected users had high speed internet
connections Broadband access is now one of the top ten considerations in deciding business
location Annual eCommerce growth is six-times faster than the overall U.S. economy Connectivity & eCommerce have made knowledge & human capital more
important than physical-infrastructure and financial capital
“Broadband has the power to make geographic isolation irrelevant” — Tom Friedman“Broadband has the power to make geographic isolation irrelevant” — Tom Friedman
1.02 Broadband Connectivity & eCommerce
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 18 —
ICT Makes a Disproportionate Contribution to National Productivity Growth
Country
1995-2000
Overall Economic
Growth Rate
% Contribution
of ICT
ICT Contribution to Economic
Growth
United States 4.3% 0.8 19%
Canada 4.75% 0.5 11%
Japan 1.5% 0.5 33%
Germany 2.5% 0.5 20%
France 2.2% 0.3 14%
UK 3.1% 0.6 19%
Australia 4.9% 1.3 27%
Belgium 2.8% 0.5 18%
Korea 5.0% 1.2 24%
Source: Enabling Canada’s Economic Potential: ICT and National Economic Performance, InterVISTAS, 2005
• ICT = Information, Communications & Technology
• Productivity growth is a key driver of economic growth
• Studies indicate ICT is responsible for somewhere in the region of 1/2 to 2/3 of overall productivity growth
• Evidence is showing that ICT’s contribution to economic growth is continuing to increase
•1950’s – 2%
•1990’s – 17%
1.02 Broadband Connectivity & eCommerce
©2007 ViTAL Economy, Inc.— 19 —
Growing SI Broadband Penetration is Critical
Source: Organization for Economic Cooperation and Development (OECD) Broadband Statistics Dec 2005 (Survey of 14 Countries); Pew Internet and American Life Project — Rural Broadband Internet Use Feb 2006
% P
enet
rati
on
of
Po
pu
lati
on
0.010.020.030.040.050.060.0
2005
Southern Illinois USA-Rural France
United Kingdom USA-Average Japan
Belgium Sweden Canada
Norway Finland Switzerland
Denmark Netherlands Korea
Iceland (Best)
USAS
I
I C E L A N D
1.02 Broadband Connectivity & eCommerce
Since 2005, the U.S. has been slipping even further behind in Broadband penetrationSince 2005, the U.S. has been slipping even further behind in Broadband penetration
Technology Deployed in the U.S.
• DSL 39%• Cable 54%• Other 7%
Note: SI 12% penetration (Jan ‘06) has already increased by 1/3 to 16% due to the collaborative efforts of Network Providers COI & Connect SI
12% 24% 54%
©2007 ViTAL Economy, Inc.— 20 —Source: PEW/ Internet, “Home Broadband Adoption” 2007
Rural vs. Urban Broadband:
The Divide is Shrinking1.02 Broadband Connectivity & eCommerce
47% of all adults have a broadband connection at home (2007)
Among individuals who use the Internet at home, 70% have broadband and 23% have dialup
55% of Rural Internet users have a broadband connection at their home vs. 73% of Urban and Suburban
Rural broadband adoption at 31% continues to lag behind Urban 51% & Suburban 52%
55% of Urban and Suburban workers have hi-speed internet at their work vs. 38% of Rural workers
47% of all adults have a broadband connection at home (2007)
Among individuals who use the Internet at home, 70% have broadband and 23% have dialup
55% of Rural Internet users have a broadband connection at their home vs. 73% of Urban and Suburban
Rural broadband adoption at 31% continues to lag behind Urban 51% & Suburban 52%
55% of Urban and Suburban workers have hi-speed internet at their work vs. 38% of Rural workers
*SI
SI as of Jan ‘06 —Only 12% Penetration, less than 1/2 National
Rural Average!
SI as of Jan ‘06 —Only 12% Penetration, less than 1/2 National
Rural Average!
Quote from SI Citizen: “Connect SI has achieved morebroadband growth in one year than the previous decade!”
*SI
SI as of Nov ‘07 —Up 1/3 to 16% Penetration
SI as of Nov ‘07 —Up 1/3 to 16% Penetration
©2007 ViTAL Economy, Inc.— 21 —
73% of American Adults Now Use the Internet
eCommerce Activity U.S. Adults Who Have Ever Engaged in Activity (%)
Researched a product or service prior to purchase 78
Obtained travel information 73
Purchased a product 71
Purchased or made a reservation for travel 63
Look for “how-to”, “DIY” or repair information 55
Online banking 43
Obtain financial information (i.e. stock quotes, mortgage interest rates)
41
Pay bills 38
Rate/ review a product, service or person 32
Use online classified ads or sites 30
Sell something 15
Buy/sell stocks, bonds, mutual funds 13
Source: PEW Internet & American Life Project Home Broadband Adoption March 2006
1.02 Broadband Connectivity & eCommerce
©2007 ViTAL Economy, Inc.— 22 —
U.S. Online Retail Sales: More than Doubled in 3 Years*
*Excludes Travel, Prescription, and Auto*AAGR = Average Annual Growth Rate
Source: Jupiter Internet Shopping Model, 2006
0
20
40
60
80
100
120
140
1999 2000 2001 2002 2003 2004 2005 2006
U.S. Online Retail Sales
$Bil
lio
ns
$12.3
$63.9
$130.3
Since the 3rd Quarter of 2003 U.S. Economic Growth has Averaged 4.6%vs. 26.8% AAGR in Online Retail Sales — nearly 6x’s faster!
Since the 3rd Quarter of 2003 U.S. Economic Growth has Averaged 4.6%vs. 26.8% AAGR in Online Retail Sales — nearly 6x’s faster!
1.02 Broadband Connectivity & eCommerce
©2007 ViTAL Economy, Inc.— 23 —
eCommerce Enables U.S. SMEs to Go Global
Strong U.S. growth in flexible and dynamic SMEs (small/medium enterprises) — driven by eCommerce
In 2005, SMEs employed 57 million Americans, over half of U.S. employment
65% of European Gross Domestic Product (GDP) comes from SMEs, vs. 45% in the U.S..
SMEs dominate development of new eCommerce sites: Accounted for 90% of new commercial sites in 2007 (vs. 80%
in 2006 and 75% in 2003) SMEs focus on eCommerce because it provides access to
international markets in a cost-effective manner
Small businesses turn to the Internet because: Impact – communicates a strong organizational identity Partnerships – allows companies to partner with distant
companies for product development, marketing, etc. Export Opportunities – opens up markets at lower cost of
entry Growth – replaces power in employee count with power of
technology
Strong U.S. growth in flexible and dynamic SMEs (small/medium enterprises) — driven by eCommerce
In 2005, SMEs employed 57 million Americans, over half of U.S. employment
65% of European Gross Domestic Product (GDP) comes from SMEs, vs. 45% in the U.S..
SMEs dominate development of new eCommerce sites: Accounted for 90% of new commercial sites in 2007 (vs. 80%
in 2006 and 75% in 2003) SMEs focus on eCommerce because it provides access to
international markets in a cost-effective manner
Small businesses turn to the Internet because: Impact – communicates a strong organizational identity Partnerships – allows companies to partner with distant
companies for product development, marketing, etc. Export Opportunities – opens up markets at lower cost of
entry Growth – replaces power in employee count with power of
technology
Source: SMEs rule the world. Peter Cochrane. July 2006
Export Power with eCommerce
1.02 Broadband Connectivity & eCommerce
©2007 ViTAL Economy, Inc.— 24 —
Broadband Connectivity & eCommerce: Implications
Extreme growth in Online Retail Sales has a direct impact on Rural main-street retail as
well as entrepreneurial-generated goods and services
Broadband: key distribution channel for existing digital content & applications, driven by: Rapid diffusion of read/write storage within consumer access devices (MP3 players, PVRs)
Benefits of interactive online purchasing tools, such as search, find and compare tools
Efficiency gained in bypassing off-line old distribution channels, getting closer to “C” (Ref: P=>C)
Broadband content & applications: packaged or bundled with other services, driven by: Convenience of a single relationship for order entry, billing, & customer service,
Content & applications production stimulate significant cross-sector linkages, driven by: Sharing production costs for content across a range of broadband platforms
Broadband will stimulate new content and applications for the consumer and business
markets, driven by: Latent consumer demand for interactivity greater choices, e.g., anywhere, anytime, anything type access
Advanced user-devices, with technical capabilities approaching that of a PC, and the ability to perform multiple
functions
1.02 Broadband Connectivity & eCommerce
Broadband & eCommerce enables SI to take advantage of the Ten Flatteners to transform its economy — not be the victim of these
Broadband & eCommerce enables SI to take advantage of the Ten Flatteners to transform its economy — not be the victim of these
©2007 ViTAL Economy, Inc.— 25 —
Broadband Connectivity & eCommerce: Opportunities
Southern Illinois Opportunity Sectors Sector Niche Applications
TourismDevelopment of a SI wide online tourism portal for one stop reservations and purchases (11 million people within 4-hrs drive)
Healthcare Utilization of a SI wide healthcare Intranet for EMR, telemedicine, etc.
International IncubationOnline access and interaction with global best practice R&D and companies desiring to enter U.S. markets
Telecommunications Creation of virtual organizations linking multiple sites using Intranets
Homeland SecurityRemote locations enable better distribution of knowledge assets that avoid “single-points-of-failure”, reducing 9/11-type impact & risk
Customer Service Development of virtual call centers for customer support
Product Design Online global collaborations for product design and maintenance
Education and Training Remote worker training for the national 10 million worker shortfall
Product ProcurementCreation of virtual buying groups, especially government for large common orders
Retail Services Online retail and service franchises for small business; mobile-IT desks
Southern Illinois Points of Light include:Illinois Virtual High School Audio-Image Marketing Shawnee Hills Wine Trail
Illinois Eastern Community College On-line Nursing
Southern Illinois Points of Light include:Illinois Virtual High School Audio-Image Marketing Shawnee Hills Wine Trail
Illinois Eastern Community College On-line Nursing
1.02 Broadband Connectivity & eCommerce
©2007 ViTAL Economy, Inc.— 26 —
Chapter 1:State, National & Global Trends
1.03 KBE and Innovation
Southern Illinois — "Garden of the Gods"
While connectivity is a great enabler, it requires knowledge, innovative thinking and entrepreneurial spirit to take full advantage of this conduit to global markets — growth,
prosperity, & economic advantage (past and future), come from innovation.
©2007 ViTAL Economy, Inc.— 27 —
KBE and Innovation: Perspective
Every person, company or organization has IDEAS, INVENTIONS, PRODUCTS, & KNOWLEDGE with potential KBE market value
A KBE Economy is driven by the production, distribution and use of knowledge for growth, wealth creation, productivity and employment increases
KBE competition is based in innovation rather than price as in classical economies
Countries and regions that show more evidence of innovation are richer and grow faster
Companies that show more evidence of innovation post better financial performance
Source: ViTAL Economy
1.03 KBE and Innovation
TIME
RE
VE
NU
E G
RO
WT
H
Traditional Economy
Innovation Economy
©2007 ViTAL Economy, Inc.— 28 —
KBE and Innovation: Overview
KBE (Knowledge-Based Enterprise) Economies that grow as a result of innovation are transforming their regulatory and community resources to support just-in-time partnerships, lifelong learning and 24/7 global access
Trends to watch include: Small and medium-businesses (SMEs) & innovation have been key to U.S. job
growth in recent decades — many relying on unique knowledge or skills In the last ten years, 90% of all U.S. job growth has been in KBE firms of
50 employees or less Innovation is shortening the life-span of new/existing businesses — at ever
increasing speed KBE work and workers are more mobile and are choosing active lifestyle in Urban
or Rural settings … suburban living is no longer in vogue ALL Product and services have the potential to exchange ever quicker and
cheaper via the internet around the world Most SI businesses have not leveraged this opportunity Many new businesses have yet to be created to accomplish this
1.03 KBE and Innovation
In a KBE Economy, the best strategy for profits isto invest in the connecting power of the internet
In a KBE Economy, the best strategy for profits isto invest in the connecting power of the internet
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 29 —
Knowledge versus Industrial Enterprise
Industrial Enterprise Knowledge-Based Enterprise
Economies of scale Smaller business units
Standardization of work Customization of work
Standardization of workforce Flexible, multi-skilled workforce
Financial capital as scarce resource Human capital as scarce resource
Corporate HQ as operational controller Corporate HQ as advisor & core competency guardian
Hierarchical pyramid structure Flat or networked structure
Employees seen as expense Employees seen as investment
Internally focused top-down governance Both internal and external distributed governance
Individualistic functional orientation Team orientation, emphasis on cross-functional teams
Information based on “need to know” Open & distributed information system
Vertical decision making Distributed decision making
Emphasis on stability Emphasis on change
Emphasis on vertical leadership Emphasis on empowered self-leadership
1.03 KBE and Innovation
Business has shifted from where you compete to how you competeBusiness has shifted from where you compete to how you compete
Source: ViTAL Economy; 1000ventures.com
©2007 ViTAL Economy, Inc.— 30 —
Must Haves of a KBE Economy1.03 KBE and Innovation
Education Level Percentage of college graduates is
primary indicator of higher per capita income
Science and Technology Activity 75% of personal income growth
during the 90’s tied to technology output
Export-Oriented Industries Industries oriented to
national/global markets produce higher value products and pay more
Entrepreneurial Initiative 90% of the new jobs created in the
new economy will be generated by companies of 50 or less employees
Innovation Across Industries and Sectors
Productivity gains do not depend on what region an industry competes, but rather how it competes
Talent Strategy Regions that promote talent across
industries are most likely to become economic winners
Reduction of Poverty and Inequality
Broad-based well-being of residents and decreased poverty are important for sustained increases in economic growth
Source: ViTAL Economy
©2007 ViTAL Economy, Inc.— 31 —
Microprenuers are the Stars of KBE Economy
Micropreneurship is a business trend for individuals that falls between the traditional entrepreneur and the garage salesman
With eBay, Amazon, PayPal, low cost manufacturing in Asia, and logistical support from companies like UPS, an micropreneur can start a business even without a bank loan
These businesses run lean with very little out-of-pocket cost
New business creation is at record high levels: Over the past two years there have been between 2.3 and 3.5 million new businesses, 0.5
million per year in the 1970s — Source: NFIB Most will remain small mom-and-pop operations A small share of start-ups will grow into titans — exceptionally important: 4% of all U.S.
companies, yet create 60% of all new jobs
Technology progress stems from: New radical innovations (50%) Incremental or sustaining improvements (50%) 95% of radical innovations come from new companies, not big, established firms
R&D spending in largest companies declined from 65% to 43%, while R&D has grown in smaller companies
1.03 KBE and Innovation
Source: National Federation of Independent Business
©2007 ViTAL Economy, Inc.— 32 —
KBE Economy: Emergence of the Creative Class1.03 KBE and Innovation
The Creative Class — composed of workers whose job is to create meaningful new forms
Composed of scientists and engineers, university professors, poets and architects, to name a few
38.3 million Americans and 30% of the workforce in America identify themselves with the creative class
Grow more than 10% in the past twenty years Shaping a new culture for the America of the 21st century
The Creative Class and the Global economy Will bring any country who has them to great economic power and growth Driven by the shift towards technology, research and development, and the internet Creates new ideas, high-tech industry and regional growth Europe is now almost equal with America's numbers for this class Regions & cities compete to attract the Creative Class
Jobs follow the Creative Class!Jobs follow the Creative Class!
*Source: “Work of Nations” by Robert Reich;Advancing Vermont's Creative Economy, Sept. 2004: Arts & Economic Prosperity III, Americans for the Arts 2005; concepts by Richard Florida
©2007 ViTAL Economy, Inc.— 33 —
The Creative Class Fuels a KBE Economy
Business Trends Business, engineering and design schools are revamping curriculum within traditional
programs to meet companies demand for innovation, globalization, knowledge management and product design skills as competitive advantage
Companies are addressing customer and organizational demands for consumer power and online cultures by recruiting professionals who understand and can manage in a world where global consumers co-create goods and services in peer relationships
Businesses now recognize that a vibrant cultural arts community is critical to the development of livable communities which encourage creativity and innovation in their workforce.
Creative Worker Trends Creative workers play an increasing role in forming new jobs and companies, and helping
mature industries retool The U.S. non-profit arts and culture community grew by 24% from 2000-2005 generating
$166.2 billion in annual economic activity and supporting 5.7 million full-time jobs Creative workers thrive in an environment where there is an authentic sense of place, a
recognition of diversity and opportunities for an energetic exchange of ideas Creative workers are mobile and are attracted to areas where creativity is welcomed
*Source: “Work of Nations” by Robert Reich;Advancing Vermont's Creative Economy, Sept. 2004: Arts & Economic Prosperity III, Americans for the Arts 2005; concepts by Richard Florida
1.03 KBE and Innovation
©2007 ViTAL Economy, Inc.— 34 —
SI’s Opportunity to Attract the Creative Class1.03 KBE and Innovation
Creative Class populations are converging in areas that provide them special amenities; the key is offering “the three 'T's”:
Talent — have a highly talented/educated/skilled population Tolerance — have a diverse community, which has a 'live and let live'
ethos Technology — have the technological infrastructure necessary to fuel an
entrepreneurial culture
The Creative Class is looking for regions that better accommodate their cultural, creative, and technological needs
SI can provide these qualities attractive to the Creative Class SIUC, the Community Colleges and R&D Parks are great attractors and
could be promoted to these creative people
*Source: “Work of Nations” by Robert Reich;Advancing Vermont's Creative Economy, Sept. 2004: Arts & Economic Prosperity III, Americans for the Arts 2005; concepts by Richard Florida
©2007 ViTAL Economy, Inc.— 35 —
High Performing Rural Communities
Rural communities that attract Creative Class professions have strong job growth and tend to generate more patents and adopt technology faster
Richard Florida Research defines the Creative Class as “jobs that are generated by KBE workers”
Counties with Creative Class attributes are among the top 25% highest performing in the U.S.
More than twice as many metro counties (593) have Creative Class attributes as non-metro counties (205)
Rural communities with a high percentage of Creative Class jobs had stronger job growth than Urban regions
Key to growth of rural communities, which support Creative Class professions, is the strategic role of a locally based research university
U.S.D.A. ranks Jackson and Williamson Counties as non-metro Creative Class counties;by comparison, IN had none; IL had only two others
U.S.D.A. ranks Jackson and Williamson Counties as non-metro Creative Class counties;by comparison, IN had none; IL had only two others
1.03 KBE and Innovation
*Source: “Work of Nations” by Robert Reich;Advancing Vermont's Creative Economy, Sept. 2004: Arts & Economic Prosperity III, Americans for the Arts 2005; concepts by Richard Florida; http://www.ers.usda.gov/data/creativeclasscodes/
©2007 ViTAL Economy, Inc.— 36 —
Role of Universities in a KBE EconomyT
each
ing
Res
earc
h
Ser
vice
Ivory Tower3 Pillars
Teaching to Learning
Classrooms Classrooms without walls
Teaching inputs Educational outcomes
One-way content delivery Two-way exchange
Preparation of next generation Continuous prep of all generations
Research to Innovation
Idea generation Idea application
Individual inventions Collaborative inventions
Single discipline focus Interdisciplinary focus
University-centered work Regional collaborations
Service to Shared Leadership
Episodic, short-term involvement Sustained, long-term involvement
Tactical, individual contributions Strategic, institutional commitment
Issue/cause focus Community/region well-being focus
Accountability for services rendered
Shared responsibility for results
FROM: TO:
Stewards of Place3 Pillars
Source: Collaborative Economics; 2006; Alliance for Regional Stewardship, AASCU, & NCHEMS
1.03 KBE and Innovation
©2007 ViTAL Economy, Inc.— 37 —
KBE and Innovation: Implications
No high-growth economy can maintain high wages and living standards, and hold its own in global markets, by producing standard products using standard methods
We live in an age of increasing pace of change and information innovation — healthy communities are both knowledge-centric & creative
Communities need to create a climate that encourages the development, incubation and growth of UNIQUE ideas/opportunities
Universities, colleges and incubators are critical to developing a prosperous KBE (Knowledge-Based Enterprises) economy
Effective technology transfer is key to ensuring that innovation is commercialized Productivity and prosperity cannot increase without innovation “In an age where economies are driven by ideas, universities must do more than creating &
disseminating ideas — it requires a redefinition of the university-model that fosters permanent engagement as a full partner in the viability & vitality of the region to which each university is connected, …”*
There are prerequisite elements/qualities to attract & retain KBEs in a rural community (see Section 1.05 Livable Communities)
1.03 KBE and Innovation
* ©2006 Alliance for Regional Stewardship, AASCU, & NCHEMS “Tools & Insights for Universities Called to Regional Stewardship”
©2007 ViTAL Economy, Inc.— 38 —
KBE and Innovation: Opportunities
Encourage the development of innovation-fostering incubators, knowledge transfer and commercialization systems, that lead to more local start-ups
Continually improve your ability to identify and commercialize new products, services and processes
Transform to a KBE Economy — SI has existing assets supporting innovation: SIU
research, Community College’s, Incubators, Research Parks, etc. The best opportunities will link R&D innovations with entrepreneurs and specialty finance bringing economic
benefit to the region
Over 7,000 new KBE jobs can be created by SI innovators with knowledge that can
address global trends such as: Green technologies Homeland security response and services Mining & safety-related technologies Bio-sciences, plant and animal
Existing success stories in SI are proof that this can be done: Dinger Bats — driven by individual passion to produce in SI and compete globally Dippin’ & Dots — new application for CO2 technology
Precision Mining (see Chapter 4) — innovative application of mine infrastructure Crownline Boats – innovators in recreational boating Green Locomotives – National railway CommunityLink – a service of Craig Williams Creative
1.03 KBE and Innovation
©2007 ViTAL Economy, Inc.— 39 —
Chapter 1:State, National & Global Trends
1.04 Transformation of U.S. Economy
Southern Illinois — "Garden of the Gods"
The U.S. is experiencing a profound economic transformation driven by globalization and our transition to an economy based on knowledge. Tried and
true industries of the past are shrinking and whole new ones are emerging.
©2007 ViTAL Economy, Inc.— 40 —
Transformation of U.S. Economy: Introduction
America’s Great Lakes region, once the core of the nation’s industrial production and wealth creation, is struggling to maintain its ground
This 12-state region reaches from Buffalo and Pittsburgh in the east, to Minneapolis-St. Paul and St. Louis in the west
Some parts of the region, such as Chicago and the Twin Cities, are thriving in the KBE Economy, while other communities, like Buffalo, Detroit, Cleveland, and Milwaukee, are losing jobs, talent, and economic vitality
Great Lakes states — lots to offer, yet have suffered more than others: More than a third of U.S. manufacturing job losses from 2000 to 2005 occurred in
seven Great Lakes states Yet, colleges and universities in these states annually produce 38% of all U.S.
bachelor degrees, 36% of all science and engineering degrees, and 37% of all advanced science and engineering degrees
The Great Lakes watershed includes one-fifth of the world’s fresh water and almost 11,000 miles of coastline
Source: The Vital Center: A Federal-State Compact to Renew the Great Lakes Region: The Brookings Institution, October 2006
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 41 —
Transformation of U.S. Economy: Overview
KBE and innovation are fundamental driving forces changing the very basis of our economy — the rules, structure, systems have all changed
The old way: “For 25 years have only paid for my hands, when you could have had my brain for nothing” — GE hourly worker to Jack Welch, CEO
Trends to watch for: Over the last four decades there has been a monumental shift in the structure of
the U.S. Economy — from Manufacturing to Services 1997-2003 Manufacturing employment shrunk as a result of productivity improvements
due to more efficient use of labor, automation and new IT Service industries created more high-skilled occupations than manufacturing — 30%+ of
the these jobs were in the highest skill category of professional, technical, managerial and administration, versus only 12% in the manufacturing sector
Traditional commodities and services have also been transforming as new opportunities for value-added niches have emerged — e.g., in bio-agriculture creating new pharmaceuticals from tobacco
Agriculture is also declining as a % of the national economy
1.04 Transformation of U.S. Economy
In ten years only one in seven businesses existing today will still be in business in the USA. Change is happening quickly, open your eyes or be left behind” - Peter Drucker
In ten years only one in seven businesses existing today will still be in business in the USA. Change is happening quickly, open your eyes or be left behind” - Peter Drucker
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 42 —
U.S. Economy Restructured Since the 1960s
0
5
10
15
20
25
30
Government
RetailWholesaleAgriculture
Manufacturing
ServicesF.I.R.E. Other
1960 2006
Share of U.S. Economy GDP by Economic Sector
Source: Bureau of Economic Analysis
From 1960 to 2006: Manufacturing’s share of GDP fell by more than 50%, while Service’s share almost doubled
From 1960 to 2006: Manufacturing’s share of GDP fell by more than 50%, while Service’s share almost doubled
*F.I.R.E. = Finance, Insurance & Real Estate
1.04 Transformation of U.S. Economy
Biggest % Declines: Agriculture Manufacturing
Biggest % Growth: Services F.I.R.E.
Biggest % Declines: Agriculture Manufacturing
Biggest % Growth: Services F.I.R.E.
©2007 ViTAL Economy, Inc.— 43 —
Globalization hits Manufacturing in Illinois
30%
17%
12%
0%
5%
10%
15%
20%
25%
30%
1970 1990 2006
Manufacturing sector in Illinois declined — from 30% of jobs in 1970 to 12% (2006), due to:
Increased automation requires less human labor
Difficulty finding skilled young workers
Source: sciencejobs.com, Insider Article
Manufacturing represents only 10% of jobs in the Southern Illinois region now
Net Result: traditional manufacturing is no longer a target area for growth and jobs
Manufacturing Employment as a % of IL Economy:
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 44 —
Manufacturing Job Loss in IL Was Worse1.04 Transformation of U.S. Economy
Illinois: Underachiever in Job Growth Illinois: Overachiever in Job Loss
IL lost 1.86 manufacturing jobs for every job lost by RMW (Rest of the Mid-West) between 1990-2006
IL lost 1.86 manufacturing jobs for every job lost by RMW (Rest of the Mid-West) between 1990-2006
©2007 ViTAL Economy, Inc.— 45 —
U.S. Holds a Globalization Productivity Advantage
The U.S. leads all countries in the absolute level of labor productivity, both per hour and per employee
The increased productivity performance in the manufacturing sector causes optimism for the sectors ability to adjust to rising levels of competition
KBE innovations create advanced manufacturing leaders offering higher wage U.S based jobs
A 31% productivity advantage of the U.S. economy over OECD* members accounts for 3/4’s of the per capita income difference
A 31% productivity advantage of the U.S. economy over OECD* members accounts for 3/4’s of the per capita income difference
Source: Manufacturing in America: A Comprehensive Strategy to Address the Challenges to U.S. Manufacturers, 2004
1.04 Transformation of U.S. Economy
*OECD = Organization of Economic Co-operation and Development
©2007 ViTAL Economy, Inc.— 46 —
Yet Advanced Manufacturing Remains a U.S. Cornerstone
The manufacturing sector continues to account for 14% of the U.S. GDP and 11% of the total U.S. employment.
BEA analysis: “Every $1 of final demand spent for a manufactured good generates $0.55 of GDP in the manufacturing sector and $0.45 of GDP in the non-manufacturing sector”
From 1977 to 2002 productivity in the overall economy increased 53%; while manufacturing sector productivity rose by 109%
The manufacturing sector continues to account for 14% of the U.S. GDP and 11% of the total U.S. employment.
BEA analysis: “Every $1 of final demand spent for a manufactured good generates $0.55 of GDP in the manufacturing sector and $0.45 of GDP in the non-manufacturing sector”
From 1977 to 2002 productivity in the overall economy increased 53%; while manufacturing sector productivity rose by 109%
How does the U.S. compete?How does the U.S. compete?Manufacturing Industry FactsManufacturing Industry Facts
Rising productivity is the key to maintaining U.S. competitiveness in manufacturing
Innovation holds the key to productivity
Rising productivity is the key to maintaining U.S. competitiveness in manufacturing
Innovation holds the key to productivity
“A nation’s standard of living in the long term depends on its ability to
attain a high and rising level of productivity in the industries in
which its firms compete.”**
**Source: Manufacturing in America: A Comprehensive Strategy to Address the Challenges to U.S. Manufacturers, 2004
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 47 —
Declining Impact of Agriculture Jobs
Productivity led to resource and agricultural job losses throughout the 1900s
Farm jobs were reduced to less than 1% of all U.S. jobs in the 1980s
Reasons include: Productivity gains (doing more with
fewer workers) Consolidation of farms
Net result: traditional, commodity-based agriculture will not lead job growth or recovery
The future lies in value-added agriculture
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
1948 1977 1997
U.S. Resource Jobs Declined Steadilyas % of all jobs
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
1977 1987 1997
U.S. Farm Jobs Declined to less than1% of all jobs in the 1980s
Source: BEA Note: Resource Jobs includes farming, forestry, hunting and fishing
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 48 —
1.04 Transformation of U.S. Economy
New Forms of Ag = Value-Added Opportunities
Biotech-science refers to lab-based techniques developing biological research, that will supply goods and services for use by humans, such as:
Recombinant DNA
Tissue cultures-based processes
Biotech combines disciplines like genetics, molecular biology, biochemistry, embryology, cell biology, & seed hybridization
Linked to practical disciplines like chemical engineering, information technology, nano bio-technology and robotics
The U.S. biotechnology industry includes approximately 1,000 companies with combined annual revenue close to $50 billion
Typical bio-agriculture companies are small, averaging 30 employees
Bio-agriculture attracts venture-capital funding
SIU is a leader in these sciences and is actively transferring this research to new business start ups
Source: ViTAL Economy
©2007 ViTAL Economy, Inc.— 49 —
U.S. Economy Growing in Value-Added Services
1800 2000
90% of the workforce was in Agriculture
90% of the workforce was in Agriculture
37% the workforce was in Agriculture
37% the workforce was in Agriculture
1.5% of the workforce was in Agriculture
1.5% of the workforce was in Agriculture
1900
4% of the workforce was in Services
4% of the workforce was in Services
26% of the workforce was in Services
26% of the workforce was in Services
82% of the workforce was in Services
82% of the workforce was in Services
Source: Richard W. Fisher, President, Federal Reserve Bank of Dallas, May, 2007
“Our per capita wealth has grown as we've moved up the value-added ladder. Most high paying jobs are in services — engineers, scientists, computer systems analysts, stockbrokers, professors, doctors,
lawyers, dentists, CPAs, entertainers and other service providers, to say nothing of the mega-compensation paid to hedge fund managers and financial engineers.…”
“Our per capita wealth has grown as we've moved up the value-added ladder. Most high paying jobs are in services — engineers, scientists, computer systems analysts, stockbrokers, professors, doctors,
lawyers, dentists, CPAs, entertainers and other service providers, to say nothing of the mega-compensation paid to hedge fund managers and financial engineers.…”
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 50 —
Service Exports: a Continuing Success Story
While the U.S. runs a trade-deficit on Goods, Services continue to be an export success story
U.S. service exports are growing rapidly. Between 2005 and 2006, U.S. service exports increased 12%
Service exports include: Travel Transportation (cargo) Royalties and fees Consulting
The majority of service exports are to Europe (40%), Asia-Pacific (27%), Latin America (17%), and Canada (10%)
0
50
100
150
200
250
300
350
400
450
500
$U.S. Billions
Exports Imports
Service Exports 2006U.S. Has Strong Service Surplus
Source: BEA
1.04 Transformation of U.S. Economy
©2007 ViTAL Economy, Inc.— 51 —
Shift from Industrial to Service Economies
1970 ($ Billions current dollars)
2006 ($ Billions current dollars)
Representation of Total GDP (%) 1970 – 2006
Trend
Gross Domestic Product (GDP)
$62,931 $589,598
Natural Resources $1,818 $3,761 2.9% - 0.6%
Construction $3,111 $28,041 4.9% - 4.8%
Manufacturing $18,176 $77,641 28.9% - 13.2%
Wholesale Trade $4,992 $42,284 7.9% - 7.2%
Retail trade $6,148 $33,874 9.8% - 5.7%
F.I.R.E.** $9,247 $132,963 14.7% - 22.6%
Services** $13,210 $214,214 21.0% - 36.3%
Government $6,230 $56,823 9.9% - 9.6%
Source: Bureau of Economic Analysis
Notes: Services sector includes health and educationF.I.R.E. = Finance, Insurance, and Real Estate
Illinois GDP by Industry
1.04 Transformation of U.S. Economy
**F.I.R.E. and Services represent the sectors for high wage KBE jobs
**F.I.R.E. and Services represent the sectors for high wage KBE jobs
©2007 ViTAL Economy, Inc.— 52 —
Breaking News Headlines
21st Century Economies Create Jobs DifferentlyJob growth in an economy is directly related to the percentage of your
economy that’s globally based
Economic Growth Is Global4.8% - 2008 growth forecast for the Global economy1.9% - 2008 growth forecast for the U.S. economy
-Business Week October 29th, 2007
U.S. Mega Companies Are Leading GlobalizationMega-U.S. companies are chasing global opportunities because the most growth is there
U.S. is leading globalization, not following itOff-shoring has been driven by U.S. companies not by foreign competitors
100% of Budweiser's profit gains in the third quarter came from sales in other countries -International Monetary Fund, World Economic Outlook, Oct. 2007
1.04 Transformation of U.S. Economy
Connectivity enables companies of any size to access these growth marketsConnectivity enables companies of any size to access these growth markets
©2007 ViTAL Economy, Inc.— 53 —
“This will be the 20th consecutive quarter in which foreign earnings of U.S. groups have grown at a double-digit clip; in fact, among the S&P 500, overseas profits are growing twice the rate of domestic operations profits”
- Bank of America
“This will be the 20th consecutive quarter in which foreign earnings of U.S. groups have grown at a double-digit clip; in fact, among the S&P 500, overseas profits are growing twice the rate of domestic operations profits”
- Bank of America
1999-2002 U.S. Company Profits
$149B in 18 countries; up 68% in 3 years
1999-2002 U.S. Company Profits
$149B in 18 countries; up 68% in 3 years
Successful SME’s are doing the same thingSuccessful SME’s are doing the same thing
1.04 Transformation of U.S. Economy
Source: National Federation of Independent Business, Sept ‘07 Article; and Small Business Administration
Note: SBA defines Small Business as companies with up to 50 employees
Fortune 500: Chasing Growing Global Markets
• Small business** exporters account for nearly 30% of total U.S. exports, which will approach $1 trillion in 2007
• From 2000 to 2006, the number of small businesses doing exports jumped by 228%
©2007 ViTAL Economy, Inc.— 54 —
Transformation of U.S. Economy: Implications
SI manufacturing employment has declined for 20+ years. Agriculture employment is also decreasing due to:
Increasing average farm size Productivity gains Loss of Agricultural land High rail rates for agricultural goods has reduced competitiveness
Regional and state policies as well as ED strategies need to more realistically reflect the growth of KBE firms and creative class employment in the economic growth sectors of F.I.R.E. and Services
Manufacturing and agriculture strategies need to be focused on value-added rather than commodity-based
SI has substantial and unrealized opportunity in the global economy
1.04 Transformation of U.S. Economy
The Transformation of U.S. Economy continues — Southern Illinois as a whole has, in effect, been impacted by, but has not actively participated in these profound shifts!
The Transformation of U.S. Economy continues — Southern Illinois as a whole has, in effect, been impacted by, but has not actively participated in these profound shifts!
©2007 ViTAL Economy, Inc.— 55 —
Transformation of U.S. Economy: Opportunities
Leverage the significant workforce development resources of SI to develop the Region into a global KBE workforce hub from the Heartland of America to the World
Leverage SI’s long growing season into value-added agriculture, bio-ag, etc. — applying Dixon Springs and SIU’s research & technology and its plant stress zone reputation
Develop KBE opportunities in existing SI industries — mining, bio-agriculture, waste water management, safety, advanced manufacturing, energy, etc.
Connect the healthcare sector into a comprehensive regional economic development strategy to achieve significant KBE job growth
Harvest & leverage asset mapping info to create sustainable new SI growth sectors
Examples of successes in Southern Illinois: Crownline Boats, Inc. — 150 dealers in US, Canada, Europe, South America, Russia and
Australia DBT America in Carrier Mills — Major Manufacturer and Re-builder of Mining Equipment Dippin’ Dots — Asia, Middle, East, Europe, Latin America, South America, Oceania
1.04 Transformation of U.S. Economy
"There is no magic formula to get the Illinois economy moving again. The key lies in thousands of decisions made by individual firms and workers that can make the state more competitive.” *
"In the modern, highly competitive world economy, few advantages last forever. The only way to succeed in the modern economy is to constantly change to respond to competitive forces.” *
"There is no magic formula to get the Illinois economy moving again. The key lies in thousands of decisions made by individual firms and workers that can make the state more competitive.” *
"In the modern, highly competitive world economy, few advantages last forever. The only way to succeed in the modern economy is to constantly change to respond to competitive forces.” *
*Source: The Illinois Report, 2007
©2007 ViTAL Economy, Inc.— 56 —
Chapter 1:State, National & Global Trends
1.05 Livable Communities &
Age of Choice
As our economy continues to transform and businesses shift toward capitalizing on their knowledge-components, workers are also changing their loyalties and
the basis for their lifestyle decisions. These are folks who practice: “live where you want, work where you live”
©2007 ViTAL Economy, Inc.— 57 —
Livable Communities & The Age of Choice: Overview
High skilled workers are choosing active Urban or recreational Rural lifestyle — fleeing the blighted suburbs and cities in search of cleaner, greener, smaller, safer and more neighborly communities
Trends to watch include: High skilled workers are choosing active Urban or recreational Rural lifestyle. Over
the last 10 years many rural counties have reversed decades of population decline More and more companies are embracing virtual teams collaborating across the
globe — fostered by connectivity and other supporting technologies —Employees are telling employers where they will live and work in the age of choice
Emerging KBE firms are prioritizing location decisions based on quality of life characteristics that are attractive and welcoming of the creative class workforce
As the baby boom generation begins to retire (2007-2025), a significant influx of urban retirees moving to rural communities is expected
1.05 Livable Communities & Age of Choice
“I have seen the critical role that the arts play in stimulating creativity and developing vital livable communities” — Paul G. Allen, Co-founder of Microsoft
“I have seen the critical role that the arts play in stimulating creativity and developing vital livable communities” — Paul G. Allen, Co-founder of Microsoft
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 58 —
Rural America is Coming Back
From 1990 to 2000, the population of non-metro counties in the U.S. increased by 10% — why?
The lower cost of living, the proximity to natural resources such as lakes and mountains and a less stressful quality of life
A significant attraction to many Americans and recent immigrants While some of these recent arrivals to rural America are retired, most of
them are still of working age — many bring wealth and a desire to remain intellectually engaged
Increased geographic flexibility for many workers, largely as a result of improved technology, has also allowed many people to move or build second homes in rural areas that are close to desirable recreation areas
1.05 Livable Communities & Age of Choice
Source USDA Briefing Room Report, Economic Research Service
©2007 ViTAL Economy, Inc.— 59 —
Livable Communities: Portals to Most Cherished Places
Livable Communities offer an attractive package that makes them a community-of-choice:
Pristine environment, community appearance & proximity to natural beauty & cultural amenities
High quality, relevant education and high quality healthcare Safe & uncongested streets, building code & zoning that enhance property value Networks of like-minded thinkers which support a climate of innovation
Rural counties that had high levels of natural amenities – a mild climate, varied topography or access to surface water – averaged a 120% increase in population from 1970 to 1996
Whereas rural areas that offered few natural amenities averaged only a 1% increase in population during the same period
Rural regions that lost population in the 1990s were mostly regions dependent on agriculture or mining (and have not leveraged their natural assets)
1.05 Livable Communities & Age of Choice
“States with strong environmental policies have enjoyed more economic growth than those with weak ones” — Bank of America study
“States that do the most to protect their natural resources also wind up with the strongest economies and the best jobs” — Institute for Southern Studies Report
“States with strong environmental policies have enjoyed more economic growth than those with weak ones” — Bank of America study
“States that do the most to protect their natural resources also wind up with the strongest economies and the best jobs” — Institute for Southern Studies Report
©2007 ViTAL Economy, Inc.— 60 —— 60 —
Curb Appeal is Critical
Choosing a community is like buying a house; if you don’t like what you see from your car, you won’t get out
Curb appeal refers to the desirability of a community and a region when seen from the curb, from the outside
You cannot get the spouses of desired KBE workers to move to communities that do not have curb appeal
Just think about what it feels like when you drive into towns leading the way, including — Elizabethtown, Steeleville, Albion, Vienna, Metropolis, Red Bud, Fairfield — they act as gateways to SI’s Garden of The Gods
20% or less of SI counties, municipalities and townships have any form of planning, zoning or building codes or permits. Some national firms are now telling their employees not to buy homes in these communities to avoid resale problems
What do visitors see whenthey visit Southern Illinois?
1.05 Livable Communities & Age of Choice
©2007 ViTAL Economy, Inc.— 61 —
Arts & Culture: Strong Attraction Potential for KBE Workers
Case StudyCase Study Key Elements of SuccessKey Elements of Success
Design – Identify what makes the community unique and appealing both to its residents and potential visitors
Adaptation rather than Replication – Success does not come from a cookie cutter approach, but rather identifying uniqueness, assessing existing programs and looking to the communities strengths and weaknesses
Involve Artists and Other Professionals – most successful revitalization programs are were developed by artists, art entrepreneurs, business owners and creative professionals
Establish Partnerships – the arts have the ability to create unique and new partnerships in the community with greater impact
Use Available Resources – under utilized or abandoned buildings, factories and historic structures become creatively woven into a revitalized area
Community Involvement – revitalization projects with the greatest chance for success are ones that target the local community and tourists
Design – Identify what makes the community unique and appealing both to its residents and potential visitors
Adaptation rather than Replication – Success does not come from a cookie cutter approach, but rather identifying uniqueness, assessing existing programs and looking to the communities strengths and weaknesses
Involve Artists and Other Professionals – most successful revitalization programs are were developed by artists, art entrepreneurs, business owners and creative professionals
Establish Partnerships – the arts have the ability to create unique and new partnerships in the community with greater impact
Use Available Resources – under utilized or abandoned buildings, factories and historic structures become creatively woven into a revitalized area
Community Involvement – revitalization projects with the greatest chance for success are ones that target the local community and tourists
1.05 Livable Communities & Age of Choice
Rock Island, Ill. pop. 38,714 Began with a small startup grant to construct 4x8
displays for juried Phantom Art Gallery in the windows of empty storefronts in downtown
The Phantom Art Gallery increased traffic in the downtown area, valuation of the downtown and utilized the arts as a tool for revitalization
The first festival produced by The District was “Ya Maka My Weekend”, held in the summer of 1992 with only six weeks of planning
Vacant store fronts have been filled, long dormant upper floors have been transformed into loft apartments, and more than 60 new businesses have opened
The District has propelled Downtown Rock Island from worst to first. In 1990, Rock Island was perceived as having the worst downtown in the Quad Cities and in 2000, 2002, and 2005 it was perceived as having the most active
Rock Island, Ill. pop. 38,714 Began with a small startup grant to construct 4x8
displays for juried Phantom Art Gallery in the windows of empty storefronts in downtown
The Phantom Art Gallery increased traffic in the downtown area, valuation of the downtown and utilized the arts as a tool for revitalization
The first festival produced by The District was “Ya Maka My Weekend”, held in the summer of 1992 with only six weeks of planning
Vacant store fronts have been filled, long dormant upper floors have been transformed into loft apartments, and more than 60 new businesses have opened
The District has propelled Downtown Rock Island from worst to first. In 1990, Rock Island was perceived as having the worst downtown in the Quad Cities and in 2000, 2002, and 2005 it was perceived as having the most active
This example is a “proof of concept” to the VE principles underlying Connect SI This example is a “proof of concept” to the VE principles underlying Connect SI
©2007 ViTAL Economy, Inc.— 62 —
Leveraging Arts & Culture in Livable Communities
Local Non-Local
61% 39%
$19.53 $40.19
Source: Arts and Economic Prosperity III, 2005
1.05 Livable Communities & Age of Choice
Arts and Culture Audience Spending
Avg: $27.79 per person, per
event
+28%
U.S. Non-Profit Arts and Culture Industry
$53.2
$80.8
$63.1
$103.1
$0$20$40$60$80
$100$120$140$160$180
2000 2005
Audiences
Organizations
©2007 ViTAL Economy, Inc.— 63 —
Most counties have less than 1% of their employment tied to the arts Most counties have less than 1% of their employment tied to the arts
Source: Amber Waves, 2007
Rural Counties Are Arts Magnets
• Rural communities as arts magnets demonstrates their ability to attract and retain creative talent — related to the initiatives promoting rural cultural tourism
• A primary component to creating rural arts magnets is the region’s ability to retain college educated workers
1.05 Livable Communities & Age of Choice
©2007 ViTAL Economy, Inc.— 64 —Source: William H. Frey analysis of 2000 U.S. Census
Livable Communities Practice Green Economics
Purchase products that have been produced using recycled materials
Apply sustainable building designs to help reduce the consumption of non-renewable resources, minimizing waste and creating healthy environments
Utilize environmentally friendly service contractors for activities such as hazardous material handling and waste management
Development and implementation of cost effective waste prevention and recycling programs including waste collection, reuse strategies and disposal of excess and depreciated inventories
Promote markets for locally grown food…will be $7 billion market by 2011
Develop innovation strategies that grow new green KBE businesses
Buy and lease environmentally friendly vehicles that use renewable fuel sources and have a lower overall consumption
Business Week 2007: “Green equals Profits; Green equals Economic Growth”Business Week 2007: “Green equals Profits; Green equals Economic Growth”
1.05 Livable Communities & Age of Choice
©2007 ViTAL Economy, Inc.— 65 —
Livable Communities & Age of Choice: Implications
KBE and other high wage earners have a CHOICE were to: #1-live and #2-work
Communities that proactively seek to become prime locations for these folks will benefit the most
Standards and improvements to one community or neighborhood is not enough to be considered a Livable Community
Joining forces across a region is essential to muster the necessary resources & critical mass needed to become a true Livable Community
SI has thus far missed the ‘rural revival’ Rural areas with natural amenities, recreational opportunities and/or quality of life
advantages are seeing significant population growth (2000 Census Analysis) An active arts and culture character is a primary part of a Livable Community
with benefits including the attraction of visitors and new investment Community events and festivals highlighting unique local artisans and culture are
‘hot’ and relatively a simple way to differentiate a community
Unless Southern Illinois has ‘CURB APPEAL’ it will decay as the U.S. transient population looks for a better life for both work and active retirement
Unless Southern Illinois has ‘CURB APPEAL’ it will decay as the U.S. transient population looks for a better life for both work and active retirement
1.05 Livable Communities & Age of Choice
©2007 ViTAL Economy, Inc.— 66 —
Livable Communities & Age of Choice: Opportunities
Southern Illinois has all of the attributes & assets to become a premier Livable Community — to do so, it will require:
Creating the linkage between quality of life and economic growth by adopting strategies that build upon its natural and cultural resources
Relying increasingly upon the attractiveness of your natural setting rather than only on extraction of raw materials for commodity markets
Adopting polices and initiatives that preserve the scenic, ecological and historical assets of a region
Pursuing an economic development strategy that is broader than the traditional tourism base to include high skilled – KBE workers
A Livable Community strategy is paramount to retaining the 19-40 age group In the interim, SI must capitalize on existing indigenous resources to become a major
tourist and retirement destination: Shawnee National Forest, many parks, lakes, rivers, wine-trails, bike-trails, golf-trails,
historic/cultural assets, arts centers & museums, artifacts, civil war history Outdoor — hunting, boating, fishing, birding, biking, state & local fairs/festivals, wine & golf
trails University & Community Colleges, speakers forum, significant performing arts resources Major college sports, minor league baseball Attractive climate
Successful towns that are already applying Livable principles on a local scale include, but are not limited to: Elizabethtown, Steeleville, Vienna, Fairfield, Albion, Red Bud, ….
1.05 Livable Communities & Age of Choice
©2007 ViTAL Economy, Inc.— 67 —
Chapter 1:State, National & Global Trends
1.06 Manpower & Immigration
Southern Illinois — "Garden of the Gods"
As the global, national and local economies shift, there is a significant and rapidly growing gap between workforce supply & demand — skill sets as well as sheer number. This is both
an enormous challenge and an opportunity for Southern Illinois!
©2007 ViTAL Economy, Inc.— 68 —
Manpower & Immigration Overview
Growth of regional economies will be more negatively impacted by long-term manpower and immigration trends than the Ten Flatteners — regional economy strategies must deal with these trends or economic growth will slow further
Workforce Trends to watch: By 2010 there will be 150 million (M) jobs in the U.S. with only 140M people to fill
them — hence the 10M worker shortage U.S. workforce grew at rate of 30% in 1970’s, at 12% in 1990’s, now slowing to 3%
and leveling off by 2010 Ever increasing need for skilled workers — U.S. businesses are requiring higher
levels of education, but workforce is projected to have declining skills 34% of adult workers in U.S. now have a bachelor’s degree or better, up from 29%
ten years ago — however, percentage of 25-29 year olds with a bachelors degree or better has actually fallen in the last ten years
Since 1970, 90% of the growth in the U.S. workforce has been filled by non-U.S.-born workers
Human Capital is replacing Physical and Financial Capital as the most important “capital resource”
1.06 Manpower & Immigration
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 69 —
Talent Supply/Demand Disconnect
Source: Global Manpower Report, 2005
Number of people of available/required by skill level
$/hour & skills
Supply of workers
Demand for workers
Men Women
Pronounced over-supply of low-skilled
labor
Lack of resources creates tension on the
high-skills market
Over-supply of low-skills resources creates
unemployment
Developed Economies Labor Market
1.06 Manpower & Immigration
There is an oversupply of low-skill workers and shortage of higher skilled workers There is an oversupply of low-skill workers and shortage of higher skilled workers
©2007 ViTAL Economy, Inc.— 70 —
Aging Workforce Effect on U.S.
Since June of 2006 an average of 15,600 workers retire everyday Versus 300 per day in 1972 Number has grown 6-fold since 1991 (2,600/day)
Aging Baby Boomers — 77 million workers due to retire by 2010 Boomers make up about 33% of U.S. workforce today Through 2021 there will be no increase in native-born workers in the
prime age category of 25-54 year olds — any growth in the labor force will come from older workers and immigrants
By 2010, 35-44 age cohort in workforce declines by 19%…those typically moving into upper management
50% of the federal civilian workforce is eligible to retire by 2011 As the U.S. workforce grows older and ultimately retires, the loss of
institutional knowledge will be immeasurable
Source: Conference Board and Forbes, Aspen Institute, National Governor’s Association, BLS; AFT
1.06 Manpower & Immigration
©2007 ViTAL Economy, Inc.— 71 —
U.S. Losing Competition for Skilled Immigrants
The new international labor market: OECD countries compete for the world’s most skilled immigrants, people with a university degree or more education or training
In 2000, the U.S. had 12.5 million immigrants with a high school education or higher, the highest total in the OECD
But measured by net “brain gain, ” skilled immigrants versus skilled expatriates compared to working age population, Australia and Canada out compete the U.S.
For example, a high proportion of Australian doctors are now foreign born
And the U.S. is increasingly restricting young graduate student entries
0
2
4
6
8
10
12
14
Percentage
Australia Canada U.S.
1.06 Manpower & Immigration
Net Brain Gain, 2000U.S. = Half of Australia and Canada
Note: Net Brain Gain is foreign skilled workers minus skilled expatriates as a % of working age populationSource: Docquier & Marfouk from David Bartlett, “U.S.
Immigration Policy in Global Perspective”
©2007 ViTAL Economy, Inc.— 72 —
Manpower & Immigration: Implications
U.S. not producing or retaining workforce necessary for growth Regional economies who welcome non-U.S.-born workers will be better positioned to benefit
from these trends U.S. not effectively leveraging its strong workforce development assets to positively respond
to trends Educational attainment not keeping pace with job trend requirements U.S. supplying workers with qualifications that address declining demand for low skill jobs
rather than serving the expanding demand for higher skill workers Any region that can successfully produce a globally competitive workforce, will secure
the ultimate competitive advantage for the next three decades Training and education are a key workforce priority Skills gap range from basic (literacy, numeracy) to complex (computer sciences & application
knowledge) The U.S. economy will require an influx of immigrants to meet industry demands or the
economy will atrophy as a consequence Many of these workforce immigrants will require training due to lower levels of education and
skills This will require a multi-cultural understanding and management skills Regional economies who welcome non-U.S.-born workers will be better positioned to benefit
from these trends
1.06 Manpower & Immigration
©2007 ViTAL Economy, Inc.— 73 —
Manpower & Immigration: Opportunities
Position SI as a national workforce development center for addressing the ten million skilled worker shortfall by 2010
Leverage 60+ years of experience at SIU with over 100 cultures to create an attractive environment for retaining and growing immigrant workforce
Improve workforce development value chain alignment and strategies (K-12, Higher Education, Workforce Development Centers, and industry etc.)
Establish measurable strategic goals for raising educational attainment levels of SI and SWI within next 10 years and link this with economic development initiatives to gain traction & funding
Embrace workers in their 50’s and 60’s now through creative approaches that move them from a mindset of wanting “freedom from work” to a desire for the “freedom to work”
Promote inclusiveness by tapping into underemployed and unemployed non-traditional labor sources
Reverse the brain drain of 20-29 year olds in SI and tap into the thousands of SIU International students who would like to stay in SI, but see no opportunity
Emphasize KBE skill focus of current and future workforce
1.06 Manpower & Immigration
In the next two years CHINA will graduate more MBAs than the U.S. currently has enrolled students in all our colleges today - USA Today
In the next two years CHINA will graduate more MBAs than the U.S. currently has enrolled students in all our colleges today - USA Today
©2007 ViTAL Economy, Inc.— 74 —
Chapter 1:State, National & Global Trends
1.07 Aging Population
Southern Illinois — "Garden of the Gods"
There is a coming tidal wave of retirees as Baby Boomers turn 65. Those communities that position themselves as an attractive retirement setting with all the
commensurate amenities will capture a big share of this future reality.
©2007 ViTAL Economy, Inc.— 75 —
Aging Population: Overview
In addition to the significant impact that aging has on the U.S. workforce shown in the previous Sub-Chapter 1.06, these same shifts will create enormous challenges as well as opportunities for communities across the country
Trends to watch include: As noted in Section 1.06:
Since June of 2006 an average of 15,600 workers retire everyday Versus 300 per day in 1972 Number has grown 6-fold since 1991 (2,600/day)
Aging Baby Boomers — 77 million workers due to retire between 2010 and 2030
Retirees are attracted to warmer climates with active-lifestyle amenities and lower cost-of-living
Retirees are also more attracted to graduated-care facilities, ranging from independent- to assisted-living with a variety of supportive healthcare and other services all under one roof
An increasing number of retirement-age folks are electing to stay employed (full-time or part-time), in part to continue receiving healthcare benefits and supplemental income
Over the next ten years, for the first time in U.S. history, population growth will be driven not by increase in birth rate, but by a decrease in mortality rate
Baby Boomers spend more than any other age group on travel, recreation and personal care products
1.07 Aging Population
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 76 —
From Birth to Retirement1.07 Aging Population
©2007 ViTAL Economy, Inc.— 77 —
Some Midwest Counties are Retirement Destinations
Retiree-age newcomers to non-metro areas trend to be better educated, wealthier, and more likely to be married
They tend to relocate in non-metro areas adjacent to large cities with services
Rural Counties are Losing or Gaining 65+ populationCounties with over 18% 65+ years old population, 2000
Some Midwest countiesare retirement destinations
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 78 —Source: William H. Frey analysis of 2000 U.S. Census
Other States Vying for Seniors
Nevada's elderly population grew by more than 70% during the 1990s Senior growth in Alaska, Arizona, New Mexico, Hawaii, Utah and
Colorado all exceeded 25% Florida, South Carolina, Texas, North Carolina and Georgia all
experienced senior growth rates during the ‘90s of 19% or greater These states are attractive to people of retirement age because of
their wide array of amenities, such as warmer climates and lower living costs
Many states in the South have made concerted efforts to lure seniors who, at least in their immediate post-retirement years, tend to contribute much more to the local economies and tax bases than they cost
Many well-off ‘yuppie elderly’ 65-74 years old have considerable disposable income, good health and remain in married-couple households
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 79 —
2007: Baby Boomers Turning 65 in IL & SI
2010 is the year Baby Boomers start turning 65 — representing the end of the Great Depression
The population 65+ has declined since 1990, but will now begin to quickly increase
SI’s 65+ population is about 6% higher than IL as a whole
SI may see an out-migration of the 65+ population due to a lack of services available that this segment demands
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
1990 2000 2006 2010 2020
SI IL
Proportion of Population
Represented by 65+ Age Segment
Source: U.S. Census Bureau
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 80 —
How Retirees Impact the Economy (1 of 2)
77 million Americans were 50 or older (28% of the U.S. population) — June 2006
Source: mynextphase.com: Retirement Facts & Trends”
1.07 Aging Population
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
80% of all Luxury Travel Purchases
47% of all Auto Sales
61% of all Over-the-Counter Drugs
77% of all Perscription Drug Purchases
54% of all Financial Assets
77% of all Consumer Demand
Seniors Population %
Seniors represent a disproportionately high % of purchases:
Taking advantage of this economic windfall requires a regionto craft specific senior-living economic strategies
Taking advantage of this economic windfall requires a regionto craft specific senior-living economic strategies
©2007 ViTAL Economy, Inc.— 81 —
How Retirees Impact the Economy (1 of 2)
Starting in 2010: Boomers have 70% of the nation's net-worth and control 50% of all household
discretionary spending They will spend $2 trillion annually on consumer goods and services Adults ages 45+ will out spend younger adults by $1 trillion annually
Boomers have much more education than prior generations equals much higher earning power
Will have a continued attachment to the workforce during their retirement years
Boomers have been more mobile all of their life, 60+ population migration may increase from 4.5% to 20%
Boomers have a strong preference for small rural communities offering intergenerational social and recreational activities
Rural areas with retirement communities grew 16% in 1980's versus 4% for all other rural areas
Rural retirement destinations versus all rural areas between 1980-1990 increased median household income 4.2% vs 0.6%
Source: "How the Retirement of the Baby Boomers Will Affect You, Part II, BBRED Georgia Southern University
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 82 —
Senior Trends
Growing trend of seniors moving to retirement communities affiliated with colleges
For many people, living on or near a campus is better than a condo on the fifth green
Senior housing communities of the future will have majority of residents with higher education degrees
They will seek communities with college or universities offering life-long learning programs
Affluent seniors, the Baby Boomer Generation, will soon inherit the largest transfer of Generational Wealth
The Silent Generation, aged 74-84, will soon pass on their wealth (est. $71 trillion) to the Boomers
Visionary communities are already crafting senior living strategies to attract affluent seniors
1.07 Aging Population
Source: Threshold Development, Retirement Living Information Center and The Great American Wealth Transfer...Fact or Fiction? The Sharpe Group 2007
©2007 ViTAL Economy, Inc.— 83 —
Future Housing for Retirees
Results from the 2004 Del Webb Baby Boomer Survey: “Fast Facts About Housing”
36% will move or plan to move when they become empty nesters; one-third of whom will move more than 3 hrs away
When they retire, 55% say they will move; 51% of whom more than 3 hrs away
26% will consider purchasing a home in an age-qualified Active Adult Community (versus 51% unsure and 24% who said no)
Of those purchasing a home, 30% prefer an Urban location, 29% want a community that maximizes local natural benefits; 22% like an active adult community located within a multi-generational development
Boomers are more than twice as likely as those aged 59-70 to prefer an Active Adult Community that is part of a multi-generational neighborhood
Source: mynextphase.com: Retirement Facts & Trends”
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 84 —
Big Shifts in Senior Living Preferences
Mar-Aug ‘07 Survey sponsored by ERA Research; conducted by Opinion Research
75% of 50+ men & women: want to be near family when considering their next move 20% are thinking about moving in next 5 years; 65% prefer a single family home 70% of those considering an active adult lifestyle community: being near friends &
family was a priority 6% (versus 2% last year) would consider moving to an active adult community
National Investment Center for Seniors Housing & Care Industry “2007 Edition of the National Housing Survey of Adults Age 55+”
12% (versus 7% in 1998) indicated they lived in housing** planned for 55+ age group 19% of 75+ years of age households lived in age qualified communities in 2007 37% of 60+households (versus 18% in 1998) were willing to consider age qualified
housing 9% of 60+ households (versus 4% in 1998) had decided to move to an age qualified
property in the future
**Age-qualified housing refers to active adult communities, independent living, assisted living, continuing care retirement communities (CCRCs), 55+ apartments and rent-subsidized housing
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 85 —
Aging Population: Implications
The aging population will create new needs and pressures for nutrition, healthcare, and housing on a vast scale
Communities must prepare for the onslaught Those communities that proactively position themselves and offer a combined
package of life-style, reasonable cost-of-living, attractive facilities and other amenities will benefit from an influx of wealth and community revitalization
Communities with growing % of elderly population need to have a proactive strategy with this population to provide these services & related infrastructure:
Arts & Culture Wealth management services Retail services Recreation — amenities for active seniors Tourism Independent living through graduated care Lifelong education Catering to families with children & grandchildren (visiting & living)
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 86 —
Aging Population: Opportunities
SI amenity & location assets are of keen interest to 30% of 77 million Baby Boomers SI land costs and underdeveloped land areas offer opportunities for senior living communities Emerging opportunities for high-end RV developments and active mature tourists Active lifestyle amenities of golf, fishing, hiking, birding across SI will receive more support
The purchasing power of future seniors is an opportunity for many SI business sectors Wealth management services and real estate development will expand Lifelong learning, performing and creative arts sectors will be in demand Boutique shopping villages and unique restaurant venues will be desired
Aging, financially-independent retirees will have major implications for healthcare Large increase in demand for specialty medical services for aging populations Opportunities to incubate and test new services, medicines and devices for aging population Expanded and changed critical skills requirements for professionals and para-professionals
Communities with pro-active senior living strategies benefit financially Communities that end up reacting to senior living trends suffer financially Now is the time for SI to get in front of and benefit from this on coming economic
tsunami
Every day, for the next 12 years: 18,000 USA workers will retire - U.S. News & World ReportEvery day, for the next 12 years: 18,000 USA workers will retire - U.S. News & World Report
1.07 Aging Population
©2007 ViTAL Economy, Inc.— 87 —
The southern 16 counties are only getting 1.5% of Illinois tourism revenue, yet have 2.9% of the population (SI has 3.3%) and most of the Tourism assets! With over 11 million people within a
4-hour drive of SI, there is a huge opportunity to capture 2-to-3 times more tourism dollars.
Chapter 1:State, National & Global Trends
1.08 Tourism
Southern Illinois — “Garden of the Gods”
©2007 ViTAL Economy, Inc.— 88 —
Tourism — Overview An aging & more mobile population travels more for experience-based
pleasure Trends to watch for include:
Adventure: Half of U.S. adults have taken an adventure tourism trip in the last five years — 31 million adults engaged in hard adventure activities: whitewater rafting & mountain biking
Educational Travel: The learning aspect of travel is important to U.S. travelers, with 20% (30.2 million adults) having taken an educational trip to learn or improve a skill, sport or hobby in the past three years
The Internet & online services are very popular with travelers, who tend to be quite computer savvy — 65% of the 98.3 million travelers used the Internet to make travel plans in 2004
National/State Park Travel: American travelers love the great outdoors — 40 % of U.S. adults in 2003 have visited a national park at least once while on a trip of 50 miles or more away from home in the past five years
Historical Places/Museums are popular attractions for travelers within the U.S. 58% of U.S. adult travelers included an historic activity or event on a trip during the past year:
84.7 million U.S. adults Their households generated 143.5 million person-trips including a visit to historical places or museums
in 2002 41% of past-year travelers say they visited a designated historic site, such as a building, landmark,
home, or monument during their trip; 28% visited a designated historic community or town
1.08 Tourism
Sources: Varied (see the rest of this Section)
©2007 ViTAL Economy, Inc.— 89 —
Tourism Trends & Impact1.08 Tourism
Trends:• More local car trips two-days from home• 58% of adult travelers trips will include historical and educational site visit• 65% will book trips on line• 23% of Boomers seek adventure trips• 55% of group travelers are going to family reunions or functions • Tourism spending will increase 15% from 2006 to 2010 to $821 billion• 89% of travelers will be under 55 years old
Impact:• 7.5 million Jobs in travel industry in the U.S.• $700B will be spent in 2008• Great Lakes region overnight stays to increase 3.5 to 4.3% annually• Non profit Arts and cultural activities generate $166.2 billion/year in revenue• Arts employs 5.7 million in full-time jobs• Arts events often return 299-387% on investment costs to local cities
Source: Tourism Industry Association; Arts & Prosperity II
©2007 ViTAL Economy, Inc.— 90 —
New Kinds of Group Travel
Median spending for group gatherings is $1,800 (not including corporate meetings)
On average, 19 individuals attend a gathering and that event typically lasts 3.5 days
55% of group travelers are traveling for a family reunion or function
Younger respondents (21-34) are more likely to plan friend reunions, school group/class reunions, bachelor/bachelorette parties, and concerts or other entertainment/spectator sport events
Travelers making up the groups and meetings segment include family reunions, sports outings (ski, golf, tennis, etc.), friends' reunions (mancations, girlfriend getaways, fraternity/sorority, etc.), weddings, association/community groups, religious events and corporate meetings
Source: PhoCusWright, Inc. Dec. 2006
1.08 Tourism
©2007 ViTAL Economy, Inc.— 91 —
The Tourism Market is Global1.08 Tourism
Source: World Tourism Organization
020406080
100
Spending (billions of $s)
U.S.SpainFranceItalyChina
U.S. #1 Destination for Spending, 2006(by Country of Origin)
Leisure,Recreation& Holidays
51%VisitingFamily and Relatives(VFR)
27%
Business
16%
Other 6%
Leisure and Business Travel Increasing;VFR Declining in Share
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
1995 2010 2020
World Tourism to Double by 2020:Annual international tourism arrivals (000’s)
6.5% AAGRAverage Annual Growth Rate
©2007 ViTAL Economy, Inc.— 92 —
QuickTime™ and aTIFF (Uncompressed) decompressor
are needed to see this picture.
International Visitors = High Spend Rates: Tourism Revenue Opportunity
European Visitors:• 45% visit historical sites• 27% visit small towns• 27% see art galleries &
museums• 24% tour countryside
European Visitors:• 45% visit historical sites• 27% visit small towns• 27% see art galleries &
museums• 24% tour countryside
The U.S. receives almost 50 million international tourist visits per year: The U.S. receives almost 50 million international tourist visits per year: projected to increase 20% in five years
The U.S. receives almost 50 million international tourist visits per year: The U.S. receives almost 50 million international tourist visits per year: projected to increase 20% in five years
Average Canadian visitor spends $695 / tripTotal visits to U.S. = 15 million
Average German visitor spends $2,200/ tripTotal visits = 1.4 million
Average Japanese visitor spends $2,900/ tripTotal visits = 3.9 million
Average U.K. visitor spends $2,500/ tripTotal visits = 4.3 million
1.08 Tourism
04/10/23 ©2007 ViTAL Economy, Inc.
$585.8$555.7 $560.1
$606.9
$653.8
$699.9$733.9
$762.9$791.2
$821.0
$544.9$546.7
$300
$400
$500
$600
$700
$800
$900
1999 2000 2001 2002 2003 2004 2005 2006 2007f 2008f 2009f 2010f
f = forecast
Billions
Source: Travel Industry Association; U.S. Department of Commerce, Office of Travel & Tourism Industries; Global Insight
All Tourism Spending in U.S. to Increase 51% Over 10 Years1.08 Tourism
©2007 ViTAL Economy, Inc.— 94 —
The demographics of adults booking online show high disposable income and an
active age range
Demographic Profile of Adults Who Book Travel on the Internet(24.7 million U.S. Adults)
GENDER
Male 60%
Female 40%
HOUSEHOLD INCOME
Under $50,000 32%
$50,000 - $74,999 27%
$75,000 - $99,999 17%
$100,000+ 24%
Average Income $89,100
AGE
18-34 41%
35-54 48%
55+ 11%
Source: Travelers’ Use of the Internet, 2000 EditionTravel Industry Association of America
U.S. median household income was $46,326 in 2005
U.S. median household income was $46,326 in 2005
89% of the travelers are under 55 years old
89% of the travelers are under 55 years old
The Tourism Customer1.08 Tourism
©2007 ViTAL Economy, Inc.— 95 —
Tourism Impacts: SI Growth Potential
Tourism is big business in the U.S. 7.5M jobs are generated by travel Travelers spend $700B annually Travel generated a $7.2B trade
surplus in 2006 The SI tourism industry has far less
impact than its U.S. and IL impacts Annual spending per employee
U.S.: $93,000 IL: $87,000 SI: $73,000
The U.S. to SI spending gap is $20,000, or 27%
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
US
IL
SI
Annual Spending by Tourists Per Tourism Job, 2006
— SI behind U.S. and IL —
Source: TIA
U.S. Economic Impact, 2006
Expenditures $70B
Employment 7.5 Million jobs
Payroll $17B
Trade Surplus $7.B
Increased Spending per employeesignificant tourism growth opportunity
Increased Spending per employeesignificant tourism growth opportunity
1.08 Tourism
©2007 ViTAL Economy, Inc.— 96 —
Location, Location, Location….
What does it mean? Most vacations are now
short— proximity and ease of access is key
Nearby centers include: Indianapolis, IN St. Louis, MO Memphis, TN Louisville, KY Nashville, TN
Grey Area Shows 4-hour driving time from Harrisburg
Population within 4-hour drive: 11,303,789
Grey Area Shows 4-hour driving time from Harrisburg
Population within 4-hour drive: 11,303,789
Potential GatewayTo region
Source: Map Point and Federal Aviation Administration
1.08 Tourism
©2007 ViTAL Economy, Inc.— 97 —
Online Bookings Surpasses Off-Line Bookings in 2007
54% of all U.S booking will be done on the Internet in 2007
U.S represented 33% of total online and offline bookings (North America, Western Europe, Asia Pacific), but 60% of all online bookings
Hotels are the fasting growing online segment, surpassing airline, which had been the fastest prior to 2006
Be aware of Travel 2.0 — the industry’s use of Web 2.0 practices will empower the online consumer; tools will include:
Tagging Social content Social networking Blogging Virtual communities people point to as examples of Web 2.0
Source: PhoCusWright, Inc. Dec. 2006
1.08 Tourism
©2007 ViTAL Economy, Inc.— 98 —
Arts & Culture Economic Impact
Full-Time Equivalent Jobs 5.7 million
Household Income $104.2 billion
Local Government Tax Revenues $7.9 billion
State Government Tax Revenues $9.1 billion
Federal Income Tax Revenues $12.6 billion
Source: Arts & Economic Prosperity III: The Economic Impact of Nonprofit Arts and Culture Organizations and Their Audiences
$166.2 billion in total economic activity has a significant national impact
1.08 Tourism
Focusing on Arts & Culture gives SI a double win — tourism revenues and Focusing on Arts & Culture gives SI a double win — tourism revenues and helping build a more attractive Climate of Innovationhelping build a more attractive Climate of Innovation
Focusing on Arts & Culture gives SI a double win — tourism revenues and Focusing on Arts & Culture gives SI a double win — tourism revenues and helping build a more attractive Climate of Innovationhelping build a more attractive Climate of Innovation
©2007 ViTAL Economy, Inc.— 99 —
Recent results of San Jose CA festivals in 2006
Arts & Culture Economic Impact1.08 Tourism
©2007 ViTAL Economy, Inc.— 100 —
Trails = Recreational Tourism
Heritage Rail Trail County ParkHeritage Rail Trail County Park
• 21 miles in length running from the Mason Dixon Line to the York, Pennsylvania Historic District
• 64% of the users were from York County, with a third of the users travel more that 20mi to use the trail
• Biking is the predominate form of recreation on the trail, 80%
• 72% stated that “hard goods”, mostly biking related, were purchased in the area in the past year ($367 average spending)
• 2/3 state that they purchased “soft goods” during each use ($8.33)
• 2001 annual usage 247,000 with a population of York County, 381,000
• Expenditures related to trail activities = $90 million
• 21 miles in length running from the Mason Dixon Line to the York, Pennsylvania Historic District
• 64% of the users were from York County, with a third of the users travel more that 20mi to use the trail
• Biking is the predominate form of recreation on the trail, 80%
• 72% stated that “hard goods”, mostly biking related, were purchased in the area in the past year ($367 average spending)
• 2/3 state that they purchased “soft goods” during each use ($8.33)
• 2001 annual usage 247,000 with a population of York County, 381,000
• Expenditures related to trail activities = $90 million
Virginia Creeper TrailVirginia Creeper Trail
• 34-mile trail near Damascus, Virginia. Damascus is know as “Trail Town, USA” with the convergence of five major trails touching the Jefferson National Forest and Mount Rogers National Recreation Area
• Winter visitation projections = 24,000 and Summer visitations projections = 106,500
• 112,400 person trips per year
• 85% of all visits are by day users, 45% of the users are non-local
• The average distance traveled to utilize the trail was 154mi.
• Non-local day users expenditures per trip = $103
• Non-local overnight users expenditures = $120
• Total economic impact: Day users = $23,600/per 1000 trips. Overnight users $114,400/per 1000 trips
• 34-mile trail near Damascus, Virginia. Damascus is know as “Trail Town, USA” with the convergence of five major trails touching the Jefferson National Forest and Mount Rogers National Recreation Area
• Winter visitation projections = 24,000 and Summer visitations projections = 106,500
• 112,400 person trips per year
• 85% of all visits are by day users, 45% of the users are non-local
• The average distance traveled to utilize the trail was 154mi.
• Non-local day users expenditures per trip = $103
• Non-local overnight users expenditures = $120
• Total economic impact: Day users = $23,600/per 1000 trips. Overnight users $114,400/per 1000 tripsSource: National
Trails Partnership
Nature trails and biking paths can
be major attractions to
areas resulting in economic
benefits
1.08 Tourism
©2007 ViTAL Economy, Inc.— 101 —
Growth Sectors Rating Assessment Rationale
Heritage Tourism SI is a historic region but lacks a name (e.g. Gettysburg) which attracts national attention
Festival TourismThe State Fair and festivals in the region are developed but are individual community focused
Hard Outdoor AdventureAttractive to Generation-Xers; mountain biking the only hard adventure opportunity.
Soft Outdoor Adventure SI offers a wide range of soft outdoor adventures now – hiking, camping, birding
Wine & CulinarySI has a growing wine and culinary sector, but lacks national recognition
Hunting and FishingRegion offers a wide variety of hunting and fishing experiences, including Sparta Shooting Complex and Rend Lake
SI Tourism Growth Sectors: Assessment
Source: InterVISTAS
1.08 Tourism
= Weak to None = Improving = Average = Good = Strong
©2007 ViTAL Economy, Inc.— 102 —
Infrastructure Rating Assessment Rationale
Regional Internet Portal No easily discovered, one-stop portal for regional tourism information and bookings exists
AccommodationsLimited number of rooms, beds and campsites with infrastructure in SI, predominant in North-South
Attractions Few attractions with recognition outside the region
Transportation Lack of scheduled air travel into region inhibits national/international tourism potential
WorkforceSmall tourism workforce with relatively low pay. Relatively little 4-season business
Food ServicesLocal wineries, a few award winning BBQ & specialty restaurants offer culinary destinations
SI Tourism Infrastructure: Assessment
Source: InterVISTAS
1.08 Tourism
©2007 ViTAL Economy, Inc.— 103 —
SI Tourism Opportunity
Projections:
1. Overall SI tourism industry increases by $300-$400M/year
2. SI tourism employment reaches Illinois state levels of 4.4% of total employment = 9,121 employment with an increase of over 3,500
3. SI tourism expenditures per job reach Illinois state levels of $87,000 per job
Projections:
1. Overall SI tourism industry increases by $300-$400M/year
2. SI tourism employment reaches Illinois state levels of 4.4% of total employment = 9,121 employment with an increase of over 3,500
3. SI tourism expenditures per job reach Illinois state levels of $87,000 per job
Expenditure Categories New Facilities and Business Opportunities
Transportation 50+ transportation companies, major increase in air-traffic, 100’s of charters
Lodging Estimate thirteen 80-room hotels
Food Service 25+ restaurants and specialty food service outlets
Entertainment 35+ venues
General Retail 25+ retail outlets, especially specialty goods
Other Business 100’s of businesses will experience growth and expansion opportunities
Specific SI Tourism Opportunities
SI Tourism Expenditures
1.08 Tourism
©2007 ViTAL Economy, Inc.— 104 —
Tourism: Implications
Visitors are seeking new and adventurous/educational experiences largely within the U.S.; foreign travel to the U.S. is also growing
Niche markets like birding, culinary travelers, mountain bikers, and other “theme-based” packages are high growth markets
Communities/regions with user-friendly and integrated online presence have a competitive advantage over those that do not
Numerous tourism regions are branding themselves in a unique fashion — only the ones that deliver authentic experiences that lives up to the brand, will achieve long-term benefits
Major investment needed in tourism infrastructure and customer service resources, such as regional airports, new hotels, restaurants, etc., to support increased overnight-tourists
Rural economies successful at growing their tourism business move to a “four-season” industry with packages lifestyle offerings
1.08 Tourism
©2007 ViTAL Economy, Inc.— 105 —
Tourism: Opportunities
Catering to international visitors — seeking quality experiences, accommodations and meals
Integrated “theme packages” across the 20 counties that leverages the history, culture, mild-climate, and natural beauty
Access greater overnight stays Southern Illinois already has
several notable successes: Wine Trail B&B Association in Southeast Encampment at Ft. Massac Bocce ball in Herrin World Shooting Complex Gold Trails
1.08 Tourism
TIA projected new tourism business areas
Generation-Xers & Millennials Travelers with disabilities Girlfriend getaways Mancations Destination weddings Procreation vacations Babymoons Medical/life-enhancement travel Voluntourism Pet travel Space tourism Culinary travel Higher-education travel
©2007 ViTAL Economy, Inc.— 106 —
Chapter 1:State, National & Global Trends
1.09 Logistics, Transportation & Distribution
Southern Illinois — "Garden of the Gods"
As more and more global opportunities open up, logistics, transportation and distribution increase in importance — Southern Illinois is truly at the
crossroads of virtually all modalities.
©2007 ViTAL Economy, Inc.— 107 —
Logistics, Transportation & Distribution: Overview
Globalization and the Ten Flatteners open substantial doorways Trends to watch for include:
Logistics and transportation is an exploding global market opportunity due to shifts in supply-chain management
Work has begun on doubling the capacity of the Panama Canal — this $5.5B project will provide access to wider ships to the East Coast and Texas/Louisiana harbors to feed the Trans-Mexican-Canadian superhighway with Chinese goods
Due to capacity constraints, security risks and weather vulnerability at North American coastal ports, trans-loading/intermodal facilities enable the effective use of smaller ships via inland waterways
The NAFTA Super-highway is a venture unlike any previous highway construction project — it is actually a daisy chain of dozens of corridors and coordinated projects that are expected to stretch out for several decades, cost $100’s billions and end up radically reconfiguring not only the physical landscape of these U.S., but our political and economic landscapes as well — Kelly Taylor, 8/06 “New American”
1.09 Logistics, Transportation & Distribution
Sources: Varied (see the rest of this Section); US Department of Commerce, Menlo Worldwide, Plunkett Research, Ltd.
©2007 ViTAL Economy, Inc.— 108 —
Key Transportation Trends
Transportation is one of the world's largest industries — sectors range from taxis to trucks to airplanes, trains, ships, barges, pipelines, warehouses and logistics services
In 2006, the U.S. Transportation Industry was about $1.6 trillion Includes for-hire and not for-hire sectors, support & repair Transportation directly employs about 4.5 million Americans — >10% of
U.S. economy In the U.S. alone, total freight shipment volumes are expected to
increase by 70% between 1998 and 2020 Texas A&M University, analyzed traffic patterns and delays in 85 U.S.
major metropolitan areas Total annual cost of traffic congestion in these cities was $63 billion 3.7 billion hours of traffic delay and 2.3 billion gallons of fuel consumed by
delays
Well-positioned rural regions have a strategic advantage in becoming a “traffic-free” hub
Well-positioned rural regions have a strategic advantage in becoming a “traffic-free” hub
1.09 Logistics, Transportation & Distribution
Source: U.S. Department of Transportation
©2007 ViTAL Economy, Inc.— 109 —
QuickTime™ and aTIFF (Uncompressed) decompressor
are needed to see this picture.
The World and Southern Illinois: Rail
From a regional network …
… to a North American one
SI is now the center of a rail network stretching to the Pacific, Atlantic and Gulf of Mexico SI is now the center of a rail network stretching to the Pacific, Atlantic and Gulf of Mexico
1.09 Logistics, Transportation & Distribution
• When originally built in 1850’s, it’s goal was to connect Chicago with the Mississippi
• Modern rail is truly trans-continental, triangulating major seaports
©2007 ViTAL Economy, Inc.— 110 —
U.S. Sea Container Traffic:Base of Globalization
Six-fold increase in U.S. container traffic since 1980 By 2010, containerization will be 50% greater than 2005 rates and by 2020, they will
more than double This indicates strong growth in international trade Container traffic already exceeds port and rail carrier capacity
Source: Cambridge Systematics
1.09 Logistics, Transportation & Distribution
Over 10 million TEUs (20 foot-equivalent-units), are annually shipped back to Asia empty — a significant opportunity for SI to fill
Over 10 million TEUs (20 foot-equivalent-units), are annually shipped back to Asia empty — a significant opportunity for SI to fill
QuickTime™ and aTIFF (Uncompressed) decompressor
are needed to see this picture.
©2007 ViTAL Economy, Inc.— 111 —
Container-On-Barge via Inland Waterways
Increasing sea container numbers, lack of U.S. truckers, cost of fuel among the factors driving containers to barges
This creates SI Mississippi and Ohio River terminal opportunities
Container on barge is developing on the Mississippi (Houston-Memphis) and will expand
Barges are less expensive because a barge can move 45 full-sized sea containers
These rivers have been key transportation systems for over 300 years
A ton of cargo can be moved 514 miles by barge on a gallon of fuel as compared to moving that same ton only 60 miles by truck or 202 miles by train
A ton of cargo can be moved 514 miles by barge on a gallon of fuel as compared to moving that same ton only 60 miles by truck or 202 miles by train
Source: Transportation for Illinois Coalition Press Release, Investment needed in Upper Mississippi-Illinois waterway for economic growth and jobs. September 15, 2006
1.09 Logistics, Transportation & Distribution
SI centrally located on
the Mississippi & OhioRiver Systems
©2007 ViTAL Economy, Inc.— 112 —
The Rhine as a Comparison
Rhine River container traffic increased from 10,000 units in 1975 to 2.3 million units in 2003
Container barges travel as far as Switzerland
Cost-of-labor favors barge over truck; albeit somewhat slower
Like the Mississippi, the Rhinestretches from ocean ports to the
Continent’s interior
The Swiss Rhine Container Terminal
1.09 Logistics, Transportation & Distribution
©2007 ViTAL Economy, Inc.— 113 —
SI Airports have capacity to accept large, jet aircraft & air-taxi service
Two major SI airports located near interstate highway and rail junctions, create the possibility of intermodal freight
Two major SI airports located near interstate highway and rail junctions, create the possibility of intermodal freight
Source: airnav.com
SI Has Significant Aviation Infrastructure
Southern Illinois aviation infrastructure includes: Three airports with instrument landing systems and runways over 6,000 ft Nationally acknowledged SIU School of Transportation
Including Aviation Management and Technology
Planned new Transportation Education Centre (TEC) at Southern Illinois Airport U.S. Transportation Command logistics specialist pool at Scott Air Force Base, an
SI neighbor — major “information exhaust” opportunity
AirportLargest
Runway
ILS
(Instrument Landing System)
Airframe/
Power Plant
Services
Scheduled
Passenger
Services
Mt. Vernon 6500 x 150 ft YES YES Not now
Southern Illinois 6500 x 100 ft YES YES Not now
Williamson County 8000 x 150 ft YES YES YES
1.09 Logistics, Transportation & Distribution
©2007 ViTAL Economy, Inc.— 114 —
Warehousing & Distribution: Trade Growth Area
Transportation and warehousing continues to grow, supporting international trade
Between 2004 and 2014, the U.S. economy will add half a million transportation jobs
The number of distribution centers is increasing
A typical center has over 200,000 square feet, part of an international chain, focused on key market sectors, and offers value-added services
Distribution Centre services include: Pick & pack Consolidation Customer system order processing Returns processing Quality inspection Assembly Damaged returns management Exporting packing & order processing Bar code processing Labeling EDI services Kit assembly Sub-assembly Build to order Facility management Transportation management
SI is situated in the population centre of the U.S., near where FedEx and UPS both decided to establish their national hubs — Distribution is an investment opportunity
SI is situated in the population centre of the U.S., near where FedEx and UPS both decided to establish their national hubs — Distribution is an investment opportunity
1.09 Logistics, Transportation & Distribution
Source: U.S. Department of Transportation
©2007 ViTAL Economy, Inc.— 115 —
Logistics: Unmet Opportunity
Growth of U.S. population for 2006 = 0.9%
California, Texas, Florida contained most of the fastest growing centers in the U.S.
Several centers within a day’s drive of SI included in 50 fastest-growing centers for 2000-2006 at growth rates of 12% to 98% (e.g., Red Stars)
Source: U.S. Census Bureau and Map Point
Note: Map shows calculated 8 hour driving time from SI
Illinois in Relationship to Nearby 50 Fastest Growing U.S. Cities
1.09 Logistics, Transportation & Distribution
©2007 ViTAL Economy, Inc.— 116 —
Logistics, Transportation & Distribution: Implications
Dramatic reductions in shipping costs via containerization has enabled globalization of manufacturing
Distribution is conducted close to end markets — Southern Illinois is near the population center of the U.S.
124 milion people reachable within 12-hour drive Distribution requires good rail and truck connections
Trade and distribution is projected to grow rapidly Will grow rapidly in the Midwest because of its central location
Southern Illinois sits on the ultimate U.S. logistics sweet-spot, the intersection of major North-South and East-West trade routes:
Will these bypass SI or will the Region be a substantial player? Through CN (was Canadian Northern RR), SI can potentially
interact with three U.S. and two Canadian coasts SI aviation assets have the potential of serving as a niche market
player within a mid-America Intermodal Logistics strategy
1.09 Logistics, Transportation & Distribution
©2007 ViTAL Economy, Inc.— 117 —
Logistics, Transportation & Distribution: Opportunities
Globalization has increased importance of transportation and logistics
SI is currently below national and state averages
CN has transformed the Illinois Central from a North-South operation to a strong East-West orientation serving three North American coasts via one railroad
SI global reach potential has significantly increased
SI has strategic geographic location especially to Eastern and Central U.S. Distribution centers favor center-of-population location Multimodal transport: Interstate/Rail/Barge
Opportunities: For multimodal/transload facilities — address 10 million TEU/year East-West deficit To attract distribution centers Range in complexity from simple distribution, to assembly and customization Explore niche-market opportunities for aviation assets
With the dramatic increase in the cost of fuel: Waterborne traffic becoming increasingly more attractive Key to keeping Illinois grains competitive in the world market Inland waterways re-opening as a major logics solution for East-West port congestion
1.09 Logistics, Transportation & Distribution
SI infrastructure contains HUB facilities for ALL forms of transportation and distributionSI infrastructure contains HUB facilities for ALL forms of transportation and distribution
©2007 ViTAL Economy, Inc.— 118 —
Chapter 1:State, National & Global Trends
1.10 Energy
With global demand for energy ever on the rise, and renewable/alternative energy sources playing an increasing but still minor role, U.S. coal —
especially clean-coal — becomes increasingly important.
Southern Illinois — "Garden of the Gods"
©2007 ViTAL Economy, Inc.— 119 —
Energy — Overview
The World’s and U.S. appetites for energy continues to grow in all forms, and without a major technological breakthrough, carbon based sources will continue to supply the vast majority of raw material
Trends to watch include: 70% of world energy demand is specifically tied to economic growth in
developing countries If the price of crude oil stabilizes at $75 or greater, new technologies and
alternative sources of energy will emerge and impact markets U.S pubic policy decisions have the ability to influence markets quickly
and direct R&D investments Regions that can balance their consumption of resources with economic
growth will have a competitive advantage in the 21st century economy U.S. coal demand production grew only 5.4% between 2000 & 2005;
while prices went up 32.5%
1.10 Energy
Source: EIA (Energy Information Administration)
©2007 ViTAL Economy, Inc.— 120 —
0100200300400500600700800
2004 2010 2020 2030
Developed Developing
0100200300400500600700800
2004 2010 2020 2030
Developed Developing
Projected World Energy Consumption in Quadrillion BTUs Global energy demand is projected
to increase over 50% by 2030, an average annual growth rate of 1.6%
70% of the increase coming from developing countries with China alone accounting for 30%
Fossil fuels will remain the dominate fuel source by 2030, 83% of the increase by 2030
The world’s growing hunger for energy will require massive capital investment; $20 trillion by 2030 (2005 dollars)
Power sector will require 56% of the capital investment cost Over one half of the energy investment will be in developing countries
Source: World Energy Outlook 2006
One quadrillion BTUs is equivalent to two million barrels oil per day
1.10 Energy Global Energy Demand Ever Increasing
Coal will see the largest increase in demand primarily for electricity
production — China and India will account for 80% of the demand
Coal will see the largest increase in demand primarily for electricity
production — China and India will account for 80% of the demand
©2007 ViTAL Economy, Inc.— 121 —Source: Global Energy Network Institute & Exxon/Mobil
1.10 Energy
How Global Energy Demand is Being Met
Although use of alternative energy sources are growing dramatically, coal and other fossil fuels continue to dominate
©2007 ViTAL Economy, Inc.— 122 —
Liquid Energy Fuels Growth: 950% in 30 years
Source: Business Week, October 29, 2007; Energy Information Administration
0
2
4
6
8
10
12
1980 1990 2000 2004 2010 2015 2020 2025 2030
Canadian Oil Sands Ultra-Heavy Crudes Biofuels
Coal-to-Liquids Gas-to-Liquids Other
Unconventional liquid fuels will help compensate for an expected shortfall in ordinary oil
Mill
ion
s o
f B
arre
ls O
il E
qu
ival
ent/
Day
History Projected
1.10 Energy
SI has the opportunity to play a key role in coal-to-liquid and biofuels
2000-2030 Growth
Coal-to-Liquid
+138%
BioFuels +66%
Heavy Crude +65%
Canadian Oil Sands
+260%
©2007 ViTAL Economy, Inc.— 123 —
U.S. = 51% increase in consumption = 17% of world totalU.S. = 51% increase in consumption = 17% of world total
China = 131% increase in consumption = 47% of world total India = 88% increase in consumption = 8% of world total Rest of the World = 38% increase in consumption = 37% of world total
Projected Coal Consumption: Next 25 Years1.10 Energy
0.0
50.0
100.0
150.0
200.0
250.0
2004 2010 2015 2020 2025 2030
Year
Quadrillion Btu
China
United States
India
Rest of World
Total
0.0
50.0
100.0
150.0
200.0
250.0
2004 2010 2015 2020 2025 2030
Year
Quadrillion Btu
China
United States
India
Rest of World
Total
74% Increase
World-Wide
Source: National Mining Association
©2007 ViTAL Economy, Inc.— 124 —
Source: Energy Information Administration, Annual Energy Outlook 2007
1.10 Energy
U.S. Demand for Electricity Keeps Growing
2005 - 2030 Sector Demand Growth2005 - 2030 Sector Demand Growth
39% increase in the Residential Sector39% increase in the Residential Sector
17% increase in the Industrial Sector17% increase in the Industrial Sector
63% increase in the Commercial Sector63% increase in the Commercial Sector
©2007 ViTAL Economy, Inc.— 125 —
Coal Nuclear Natural Gas Renewables Petroleum
2005 50% 19% 19% 9% 3%
2030 57% 15% 16% 9% 3%
Coal-fired power plants (including utilities, independent power producers, and end-use combined heat & power) continue to supply most U.S. electricity through 2030
Source: Energy Information Administration, Annual Energy Outlook 2007
1.10 Energy
Coal’s Role in Electricity Generation Increasing
©2007 ViTAL Economy, Inc.— 126 —
Alternative Energy is Creating Ag Opportunities
Product / Ingredient
Product / Ingredient
Ethanol/CornEthanol/Corn
Bio-diesel/Soybean
Bio-diesel/Soybean
WindWind
U.S. Plants Owned
By Farmers
U.S. Plants Owned
By Farmers
70%In rural areas
70%In rural areas
40%40%
35%35%
Projected New Jobsby 2015
Projected New Jobsby 2015
203,879203,879
39,10039,100
12,50012,500
Projected GDP Increase
Projected GDP Increase
n/an/a
$46 billion$46 billion
$24 billion$24 billion
Even though renewable energy will be playing a relatively minor role over the next several decades, the opportunity for SI is still significant — agriculture, fuel production, distribution
Source: Business Week, Renewable Fuels Assoc., LECG, American Wind Energy Assn
1.10 Energy
©2007 ViTAL Economy, Inc.— 127 —
The Real Price of CornThe Real Price of Corn
• Current price of U.S. corn is not even close in real dollars to the price in the 1970’s
• Recent price increase is still not close to the returns needed to provide farmers with an adequate income without government subsidies
• June 1, 2007 the U.S. ethanol industry had 120 active plants
• Capacity of 6mm gallons/year
• 6.4mm gallons of capacity under construction
• 2009 prediction – 1.3% of U.S. corn crop will be used for ethanol
Impressive Ethanol Production
Impressive Ethanol Production
Corn: Expanding as a Consumer Products Staple & Transportation Fuel
Corn Production to Meet New Demands
Corn Production to Meet New Demands
• Corn has become a staple in a variety of products:
• Soda sweetener
• Additive in animal feed
• Dextrose in jams & jellies
• High fructose corn syrup
• New technology has raised yield to meet rising demands
1.10 Energy
©2007 ViTAL Economy, Inc.— 128 —
CleanTech is Attracting Venture Capital (VC) Investment
United Nations Environment Program Headline:
Investors Flock to Renewable Energy and Efficiency Technologies; Transactions Leap to Record $100 Billion in 2006 with $71 Billion into companies and new sector
opportunities
1.10 Energy
26.0%
10.0%
16.0%
38.0%
4.0% 6.0%
Biofuels Biomass & Waste
Solar Wind
Other Renewables Other Low Carbon
Global Investment in Renewable Energy
by Technology, 2006
Source: SEFI, New Energy Finance
27.5
49.6
70.9
0
10
20
30
40
50
60
70
80
2004 2005 2006
Global Investment in Renewable Energy 2004-2006
+80% +43%
$ B
illi
on
s
©2007 ViTAL Economy, Inc.— 129 —
1.10 Energy
Energy: Implications (1 of 2)
Demand for sustainable and non sustainable energy is increasing in the U.S.
For strategic reasons, the U.S. would prefer to source more energy within the U.S.
Coal represents continued economic opportunity New coal opportunities are related to new technology
and knowledge based enterprises (KBEs) The new industry is knowledge intensive and require
workers with knowledge skills Alternative Energy offers Agriculture opportunity and jobs
New technology in bio-fuels could increase yield per bushel
©2007 ViTAL Economy, Inc.— 130 —
1.10 Energy
Energy: Implications (2 of 2)
Breaking News: Clean-Coal has a long way to go to overcome it’s past ‘dirty image’
Maine still battling acid-rain Number of states have continued to reject coal-energy generation projects Potentially offsetting the above:
Clean-Coal technology is receiving major investment Bolstered by continued high cost per barrel for oil Breakthroughs could open the doors wide for existing Southern Illinois coal extraction,
transportation & labor
Breaking News: Ethanol in Illinois not keeping up with demand: Ethanol plant construction has stalled in Illinois; 38 permits issued since 2006 with
only five plants under construction Primary challenge facing new ethanol plants is the increasing cost of construction,
raising concerns about investor return on investment
“SI’s energy strategy should include processing of the raw material in the region, not competing in the commodity markets specifically in the area of transportation fuels” - RA interview
“SI’s energy strategy should include processing of the raw material in the region, not competing in the commodity markets specifically in the area of transportation fuels” - RA interview
©2007 ViTAL Economy, Inc.— 131 —
1.10 Energy
Energy: Opportunities
Given the demand and cost of energy, opportunities exist for oil, methane, coal, ethanol, as well as coal gasification & CO2 sequestering
SI has the potential to develop coal, oil & gas, and agriculture product related energy Opportunities relate to mining, agriculture and manufacturing
Coal opportunities are related to new technology and knowledge based enterprises (KBEs) — e.g., export coal processing & safety “knowledge” to China & India
Even coal demand is projected to grow At SIU, the region has educational resources which specialize in alternative energy
development Rail and marine access can support large energy developments
SI has had a long history of contribution & knowledge-base from the Electric Coops Collaborating with other extractors & generators will help implement a Regional Energy
Strategy
“SI has coal reserves totaling an estimated 181 billion short tons — enough to electrify the eastern half of U.S. for 80 years” - U.S. Dept of Interior
“SI has coal reserves totaling an estimated 181 billion short tons — enough to electrify the eastern half of U.S. for 80 years” - U.S. Dept of Interior
©2007 ViTAL Economy, Inc.— 132 —
1.10 Energy
Energy: Opportunities
The future will not focus on traditional energy, but rather alternatives uses and sources SI has a variety of assets that support a diversified energy strategy, opportunities exist for
oil, methane, coal, ethanol, as well as coal gasification & CO2 sequestering A diversified energy strategy will allow SI to have greater control over their future to better
temper energy cost cycles SI has the potential to link its energy assets with its transportation and logistics assets to
develop transportation fuels and technologies Processing proximity to raw materials such as coal and corn or cellulosic materials supports
feasibility Leverage the energy knowledge infrastructure and asset base
Coal opportunities related to new technology and knowledge based enterprises (KBEs) — e.g., export coal processing & safety “knowledge” to China & India
At SIU, the region has educational resources which specialize in alternative energy development; Clean Coal Research Center, National Ethanol Research Center
Create a Southern Illinois University Energy Technology Center of Excellence SI has had a long history of contribution & knowledge-base from the Electric Coops
Collaborating with other extractors & generators will help implement a Regional Energy Strategy Major energy projects such as FutureGen and Prairie State will have significant economic
impact and will expand the regions energy knowledge base
©2007 ViTAL Economy, Inc.— 133 —— 133 —
Chapter 1:State, National & Global Trends
1.11 Conclusions
Southern Illinois — "Garden of the Gods"
©2007 ViTAL Economy, Inc.— 134 —
Chapter 1: Conclusions
SI has assets to connect with economic trends and their related implications and opportunities Include the region’s natural setting and recreational
opportunities, existing universities and colleges, and geographic location
Challenges for the region: lack of clear Pan-regional leadership Skilled human resources Financing Internet infrastructure (improving)
1.11 Conclusions
©2007 ViTAL Economy, Inc.— 135 —
Trends, Implications & Opportunities (1 of 4)
Trends Implications Opportunities
Globalization: The World is Flat
• SI is competing with savvy country economic strategies
• Business competition is much more intimate
• Increase flow of business capital to international growing markets
The world economic growth rate is 4 times the rate of SI – “go get it”
SI can leverage its central location and inter-model transportation assets to become a logistics service center
Utilize the “ten flatteners” to create a collaborative regional economic development strategy
Broadband Connectivity & eCommerce
Broadband capacity and connectivity is a “must have” infrastructure to compete
On-line retail sales have a direct impact on rural Main Street America
Broadband allows SI to take advantage of the “ten flatteners”
Internet sales and distribution A region wide broadband infrastructure
strategy Apply best practice connectivity
applications to improve efficiencies Global R&D collaborations
KBE: Innovation and Knowledge Drive Jobs and Wealth Creation
90% of all new jobs will be created by companies of 50 employees or less
Innovation and commercialization of knowledge is key
KBEs: “work where they live rather than living where they work”
Link SIU research to business incubator, expertise and capital
Green technologies Homeland security response and
services Mining & safety-related technologies Life sciences, plant and animal
1.11 Conclusions
©2007 ViTAL Economy, Inc.— 136 —
Trends, Implications & Opportunities (2 of 4)
Trends Implications Opportunities
Transformation of the U.S. Economy
SI manufacturing job base has declined for 20+years
Commodity production will be replaced with knowledge based enterprises
U.S. companies will need to be nimble and adjust to the global economy and pursue growing markets
KBE potential in mining technologies, bio-agriculture, waste water management, safety, advanced manufacturing, energy, etc.
Leverage the workforce development resources to create a world class KBE workforce
Livable Communities Jobs migrating to attractive smaller communities
Boomers retiring moving to rural small communities,
Recreation and natural environment is a priority
Recreational services and products, tourism, attractive communities
Senior living strategies KBE creation and attraction Visual and creative arts
Global Workforce Shortage and Immigration
2010 there will be a 10 million worker shortage in the U.S.
Need for “smarter” workers Since 1970, 90% of the growth in the U.S.
workforce has been filled by immigrant workers
Regions competitiveness will be at risk due to lack of workforce
Transform SI into the “corporate casting agent for the 21st century
Leverage over 60 years of SIU with students from over 100 cultures
Embrace workers in their 50’s and 60’s create a climate of “freedom to work.
1.11 Conclusions
©2007 ViTAL Economy, Inc.— 137 —
Trends Implications Opportunities
Aging Population 15,600 workers retire everyday, 77 million workers due to retire by 2010
Increased demands for nutrition, healthcare and housing requirements
Consumer markets will follow the baby boomers generation
Healthcare Products and Services Senior Living Nutraceuticals ¾’s of the countries wealth is residing
with active adults desiring many of the attributes of SI
Active Tourism Visitors to the U.S. seek unique, historic, cultural visits
Resources needed to support language, customs and dietary requirements of international travelers
Shorter trips within 4 hours of home
Niche markets: Eco, culture and adventure tourism
SIU international student population linked with tourism
Recreational tourism focusing on SI unique qualities
Growing Logistics and Transportation
• Movement of goods and services is far easier than moving people
Logistics and distribution will continue to grow with imports from China and India
Mfg jobs will continue to shrink Distribution is close to end markets
SI is in a prime geographic location to seize the logistics and distribution markets
With in ever increasing cost of fuel waterborne transportation is attractive; marine transportation services
Trends, Implications & Opportunities (3 of 4)1.11 Conclusions
©2007 ViTAL Economy, Inc.— 138 —
Trends Implications Opportunities
Energy Demand Energy costs will rise with increased demand especially in the U.S.
Alternative energy will receive policy support and increasingly in demand
Coal as a fuel source and clean coal technologies will have strong demand
Coal will have to fight the a “dirty image”
Coal mining Clean coal technologies Regional energy strategies Alternative energy innovations Transportation fuels sources
Sustainable Communities Attention on global warning and pollution, Concern about healthy foods and the growth
of locally produced products Access to water is a strategic advantage
Carbon offsetting (growing trees) in rural regions,
Locally grown organic foods Nutraceuticals, Alternative green energy Regional recycling businesses
Trends, Implications & Opportunities (4 of 4)1.11 Conclusions
©2007 ViTAL Economy, Inc.— 139 —
Potential SI Jobs by Sector (1 of 2)
• Global growth opens up opportunities to expand SI economy beyond its traditional growth rate
• 10 million U.S. worker shortage is an opportunity for SI workforce development resources
• Growth in services exports enable SI to move away from uncompetitive legacy economic activities
• Global growth opens up opportunities to expand SI economy beyond its traditional growth rate
• 10 million U.S. worker shortage is an opportunity for SI workforce development resources
• Growth in services exports enable SI to move away from uncompetitive legacy economic activities
ICT* investments contribute 33% to U.S. productivity
growth…this validates importance of NP-COI
SI’s 64% increase in broadband access can better
leverage six-fold increase in e-commerce activity
4 of 5** factors in rural KBE growth are SI strengths
— need to be leveraged for SI economic growth Livable community assets present in SI are an
attraction asset for KBE, Senior Living and Tourism Alternative energy, global warming and “greening”
of society is creating innovation opportunities
ICT* investments contribute 33% to U.S. productivity
growth…this validates importance of NP-COI
SI’s 64% increase in broadband access can better
leverage six-fold increase in e-commerce activity
4 of 5** factors in rural KBE growth are SI strengths
— need to be leveraged for SI economic growth Livable community assets present in SI are an
attraction asset for KBE, Senior Living and Tourism Alternative energy, global warming and “greening”
of society is creating innovation opportunities
See: RA Chapter 1 ICT = Information & Communication Technology
**Five Factors are: • High Quality Workforce• College or Universities• Local Amenities• Transportation Infrastructure• Size
KBE
8,023New Jobs
KBE
8,023New Jobs
Global Workforce
Opportunities
18,750New Jobs
Global Workforce
Opportunities
18,750New Jobs
1.11 Conclusions
©2007 ViTAL Economy, Inc.— 140 —
Potential SI Jobs by Sector (2 of 2)
Climate of Economic Opportunity = an additional 10,210 new jobsNEW GRAND TOTAL = 50,789 Jobs (vs. 27,298 Jobs Feb ‘07)
Climate of Economic Opportunity = an additional 10,210 new jobsNEW GRAND TOTAL = 50,789 Jobs (vs. 27,298 Jobs Feb ‘07)
See: RA Chapter 1
• 77 million retiring baby boomers present an affluent
senior living growth opportunity for SI
• 77 million retiring baby boomers present an affluent
senior living growth opportunity for SI
• Preferred tourism growth sectors indicate SI is
positioned for accelerated tourism growth
• Preferred tourism growth sectors indicate SI is
positioned for accelerated tourism growth
SI energy assets and knowledge are in the sweet spot of energy priorities for growth
SI energy assets and knowledge are in the sweet spot of energy priorities for growth
Significant transportation labor shortages are moving transportation and distribution centers from the coast to the center of North America. SI location and logistics assets position it for growth
Significant transportation labor shortages are moving transportation and distribution centers from the coast to the center of North America. SI location and logistics assets position it for growth
Senior Living
3,676New Jobs
Senior Living
3,676New Jobs
Energy & Mining5,680
New Jobs
Energy & Mining5,680
New Jobs
Tourism4,450
New Jobs
Tourism4,450
New Jobs
Log/Trans//Dist1,675
New Jobs
Log/Trans//Dist1,675
New Jobs
1.11 Conclusions
©2007 ViTAL Economy, Inc.— 141 —
Carpe Diem — Seize the Day!
Opportunity is just opportunity, unless you cease it, then it becomes reward
1.11 Conclusions
A changing economy impacts the way we live, work, learn, govern and connect
We can’t run a 21st century business, community or government on 20th Century rules
A changing economy impacts the way we live, work, learn, govern and connect
We can’t run a 21st century business, community or government on 20th Century rules
The Reason for Action