- John Polk said “I knew Charles when he was EVP of The Atlanta Chamber and I worked for ...” on Memories of Oklahoma City circa 1993
- John Polk said “Back in the mid-80's and early 90's, Cleveland was actually recognized as one of the ...” on Economic development in NEO: A view from the street-level
- John Polk said “Is there any way to substantiate Dimora's claim re: GCP and the PD, other than ...” on Cleveland’s new development dynamic?
- George Nemeth said “Like all glimmers of newness in CLE+ I expect this one to be crushed too” on Cleveland’s new development dynamic?
- Cleveland’s new development dynamic? | Brewed Fresh Daily said “[...] by Ohio voters, as gambling interests convert the Ohio constitution into a zoning ordinance. ...” on Ohio’s casino deal gets a bit more messy
- About BDP Comments
It’s a mantra among politicians and CEOs across the Midwest and the country: we need to graduate more engineers in order to stay competitive in the world economy. It’s pitched as a way to create jobs and innovation. But all that might be wrong.
Joseph Bersuder, Marcus Grimm, and Cameron Close are days away from starting their engineering careers. The three are graduating from the University of Akron and hearing them talk, it’s almost like: “what economic crisis?”
Bersuder is going to work at a company constructing wastewater treatment plants. Grimm took a position with BP in Houston. And, Close accepted a job at a local green energy startup.
The money’s not bad either. From salaries in the $50,000 range to Grimm’s “Upper 70s, with five-figure signing bonus.”
To many politicians and CEOs, these guys are just what America needs.
President Obama has made it a major policy.
“We’re announcing an all hands on deck strategy to train 10,000 new American engineers each year,” he said last year at an advanced lighting company.
The conventional wisdom is that more engineers will lead to more innovation and help create the so-called jobs of tomorrow. But when Hal Salzman heard that from the President, he had a very different reaction: disbelief.
Salzman is a sociologist at Rutgers University in New Jersey. He’s been looking at the job market for engineers for years now, and he says despite all the fears out there of a shortage, and falling behind other countries, the US graduates plenty of engineers each year—more than are hired. And, of course, not all of them want to work directly in the field. So, why work so hard to create more?
“What are these engineers going to do?” he said. “If you produce more engineers, and we’re only hiring now maybe 50-60% of the engineers who graduate each year, where are they going to go? What kind of jobs? Are they supposed to sit around and wait until the economy improves?”
Salzman says hoping more engineers would help the economy is kind of like saying building more cars would help the auto industry. Instead, he says, the market does a pretty good job in this field. For instance, an oil boom in recent years has increased demand for petroleum engineers.
“The response is just what you’d expect out of Econ 101, which is: salaries went up and almost immediately the number of graduates increased,” Salzman said.
Salzman doesn’t disagree that engineering can be a good job, and he says graduates landing lots of jobs is exactly what we want. In recent years, the unemployment rate among engineers is about half the national average. But adding 10,000 more to the pool, he says, could make it harder to find work, and drive down wages. Already, many of the best and brightest students are attracted to higher-paid Wall Street or consulting careers.
What about the idea that America needs more engineers to compete globally? Salzman doesn’t buy that either. He says only a small percentage of engineers are involved in anything that could be as classified innovation. Most are building things like bridges or roads.
“Last I looked, those were not sectors that are booming,” he said.
At the same time, much of the engineering we do need is being outsourced. Even large portions of San Francisco’s Bay Bridge were designed and built in China and shipped to the US.
But Charles Vest thinks this this view is short sighted. For years, he was President of MIT. Today, he heads the National Academy of Engineering. He says we can’t predict the inventions that will create demand for engineers down the line, like the computer revolution did a generation ago.
“I don’t know that increasing the production of engineers tomorrow is going to immediately help turn the economy around,” Vest said. “But I do think it will orient our talent base to the kinds of jobs that are going to be there in the future and the people who will create those jobs.”
And, back in Akron, Joseph Bersuder, Marcus Grimm, and Cameron Close, the three engineering students, say they and their peers found plenty of offers in engineering.
“At the end of my job search, I probably turned away six or seven interviews,” Close said.
The question is, if we had more engineers, like the President and so many advocate, would that still be the case?
April 19th, 2012
Stumping President Obama was in the Midwest yesterday. He talked about job training in Ohio, according to partner station WCPN Ideastream. At a stop in Dearborn, Mich., the president emphasized the importance of “making things,” according to Michigan Radio.
Delayed, not defeated Chicago Mayor Rahm Emanuel has agreed to a six day delay on a vote for his $7.2 billion infrastructure plan, after getting more pushback than expected from City Council. The Chicago Tribune says the Mayor will probably still get approval, and “the brief nature of the pause suggested the maneuver was primarily tactical and designed to project the appearance of compromise.”
Fewer teachers The number of school teachers in Wisconsin dropped 2.3 percent last year, according to the AP. Despite the cuts, Gov. Scotte Walker’s spokesperson says his education reforms are working.
Internet instruction The University of Michigan is one of only three universities in the country that will try out a new, more interactive online learning program, according to Michigan Radio. The program was developed at Stanford.
Paying for pensions Chicago teachers are pushing to get support from the state to fund their pension plan. Partner station WBEZ reports that many public employee pension accounts in Illinois are underfunded.
Dustin Dwyer · Midwest Memo: Detroit In Legal Limbo, Ohio Becomes Dumping Ground And Etch-A-Sketch Gets A Bump From Gaffe
March 23rd, 2012
It’s a mess, basically Efforts to avoid a financial meltdown in the city of Detroit are turning into a confusing legal situation. Partner station Michigan Radio reports a judge says the state can’t enter into its proposed consent agreement with the city until he decides whether the state’s review team broke open meetings laws. And there’s some disagreement over when the actual deadline is to reach a deal.
Wasteland BusinessWeek reports on how Ohio has become a dumping ground for the chemical-laced wastewater brine that’s a byproduct of new natural gas drilling in the U.S. BusinessWeek says Ohio has 176 storage wells for the “fracking” fluids. In comparison, Pennsylvania has just six such wells.
Romney is helping business The Toledo Blade reports on how an Ohio company has benefited from a political gaffe. Ohio Art Co., the maker of Etch-A-Sketch, has seen its stock more than double since a Mitt Romney aide referenced the toy in an interview on CNN. The statement has turned into one of the biggest gaffes of the GOP primary, but Ohio Art Co. isn’t complaining. Sales of Etch-A-Sketch toys are on the rise, and company executives are trying to manage requests for media interviews.
O-H-I Am Pandering President Obama visited Ohio State University yesterday. He promised to increase drilling in the United States, but he says he draws the line at drilling in Ohio Stadium. The President also made some hand signs that won’t play well in Ann Arbor.
Hogan out Partner station WBEZ reports on the resignation of University of Illinois president Michael Hogan.
Chicago secession? A landfill operator is trying to secede his 86 acres of property from the city of Chicago, and join the suburb of Dolton. The move is an attempt to get around the city’s ban on landfills.
Dustin Dwyer · Midwest Memo: Fracking Taxes, Manufacturing Grants And Head Start Problems In Detroit
March 9th, 2012
Taxing the fracking Bloomberg reports that Ohio Gov. John Kasich has a new proposal to tax oil and gas drilling in his state. Taxes on the new kinds of drilling, known as “fracking,” could raise $1.02 billion for the state by 2016, according to the report.
$1 billion for manufacturing President Obama plans to be in Virginia today to promote a new $1 billion grant program to fund innovation in manufacturing. The plan requires approval from Congress.
Turning it around Wisconsin added jobs last month. But previous months’ figures were revised, creating a more mixed jobs picture.
Head Stop The federal government will stop sending $50 million a year to the city of Detroit to administer Head Start programs. The Detroit Free Press says the decision follows reports that city officials mishandled the money. Now, the government will try to find other organizations to run Head Start in the city.
Lower funds for higher ed Michigan is losing about $4 million in federal higher education funds. The loss is because the state cut its own budget for higher education, according to the Gannett news service.
January 27th, 2012
Party like it’s 1998 Ford is reporting its highest annual earnings in over a decade. The Wall Street Journal says the auto industry’s profits are part of its new math: sell fewer cars, make more money (subscription required).
Curiouser and curiouser Keeping track of Wisconsin politics gets more complicated by the day. While the Wisconsin Government Accountability Board is still busy counting recall petitions against Gov. Scott Walker, the Milwaukee Journal Sentinel reports that two of the governor’s former aids have been charged with illegal campaigning. The charges are part of an ongoing “John Doe” investigation of Walker’s staff during his time in county government. Despite the investigation and the recall threat, Walker’s poll numbers are rising.
Meanwhile, in actual economic news, the Wisconsin Assembly voted to ease the way for a proposed Iron ore mine in the state’s northern region. Republicans say it will create jobs. Democrats say the changes could lead to environmental harm.
190 Acres of transformation In Cuyahoga County, Ohio, a 190-acre industrial site represents, in microcosm, the changes facing the Midwest. Officials in the town of Beachwood are hoping to rezone the property as the industrial sector declines and other sectors grow. Officials say they want to see the property used for health care, retail and residential investment.
Obama talks higher ed President Obama will be in Ann Arbor, Mich. today to talk about his ideas for higher education funding.
You might have heard something about a speech last night. From his claim that GM is back on top (rated “half-true” by PolitiFact.com), to his mention of a battery plant worker from Holland, Mich. (which, by the way, we’ve covered before), the Midwest got plenty of attention from the President during his State of the Union address.
And he’s not done with us. This afternoon, the President is in Cedar Rapids, Iowa to talk manufacturing jobs. He’ll also be traveling to Arizona and Nevada. This Friday, the President returns to the Midwest for a stop in Ann Arbor, Mich. This time, he’ll be talking about higher education.
During the State of the Union speech, President Obama said higher education shouldn’t be a luxury, and he’s committed to funding it. That was the carrot for colleges and universities. This was the stick:
“Let me put colleges and universities on notice: If you can’t stop tuition from going up, the funding you get from taxpayers will go down,”
The idea is similar to a law passed in Michigan last year for the state’s public universities. They raised tuition anyway.
Dustin Dwyer · Midwest Memo: Downtown Development In Indy, Wind Farming In Ohio And A Wrigley Icon Survives Bankruptcy
January 25th, 2012
But enough about speeches. Developers are planning an $85 million residential complex for downtown Indianapolis.
A state law in Michigan will force the city of Detroit to lower its income tax rate. That could cause an $8.5 million hole for a city already struggling to fix its budget.
In Champaign County, Ohio, which is northeast of Dayton, a $20 million wind farm project is inching forward, but residents still aren’t completely sold on the idea.
Finally, Wrigley Field is one of the most iconic venues in all of sports. One of its many charms is the nearby rooftop seating that overlooks the field. One of those buildings with that rooftop seating recently went into bankruptcy. It sold at auction for $4.8 million.
January 24th, 2012
The 2009 bankruptcies at General Motors and Chrysler were a historic moment for the Midwest economy. But a new memo published this week by The New Yorker shows that they were in danger of happening even sooner.
The insight can be found starting on page 36 of a 57-page memo by Lawrence Summers, written to President-elect Barack Obama on Dec. 15, 2008. The memo provides an in-depth look at the thinking that went into drafting Obama’s economic recovery plan.
At the time of the memo, Congress was considering emergency financing for car companies, who had been unable to borrow money from the nation’s banks. The Bush administration also was considering whether to use money from the Troubled Asset Relief Program, originally intended to rescue struggling banks.
Summers wrote, “Given GM and Chrysler’s current cash positions, it is overwhelmingly likely that one or both would be forced to file before or immediately after the New Year.” The Treasury Department, under President Bush, estimated the two companies would need $100 billion in bankruptcy financing.
“We believe that number to be wildly inflated,” Summers wrote.
In the end, the Obama administration provided $82 billion to finance the bankruptcies at GM and Chrysler, and pay for other assistance to dealers, suppliers and communities affected by the auto industry crisis.
Summers’ memo makes for interesting reading for anyone who’s followed the car companies’ bankruptcy and restructuring.
November 16th, 2011
On Wednesday, the White House formally issued a proposal to nearly double automotive fuel efficiency standards by 2025. The proposal to boost the standards to 54.5 miles per gallon – a jump from the 27.3 mpg required today – comes on the heels of an agreement President Obama reached this summer with automakers.
Here’s a glance at five responses to the news:
Dan Becker, Safe Climate Campaign
“It is not every decade that a president does something to simultaneously help the environment, consumers and the auto industry. President Obama has done just that. These standards are the biggest single step any nation has taken to fight global warming. They will slash our oil addiction.”
John Dingell, U.S. Representative from Michigan’s 15th Congressional District
“The national program allows American manufacturers to continue building the cars consumers want to buy. It gives industry the certainty they need to invest in the future and promotes American manufacturing of advanced technology vehicles. This program is critically important so our manufacturers do not have to meet a patchwork of different standards.”
Mitch Bainwol, CEO of the Alliance of Automobile Manufacturers
“The proposed regulations present aggressive targets, and the administration must consider that technology breakthroughs will be required and consumers will need to buy our most energy-efficient technologies in very large numbers to meet the goals.”
Jonathan Tobias, owner of Michigan Green Cabs in Ann Arbor, Mich.
“Higher fuel standards would allow me to expand my business immediately, and they would boost my employees’ spending power as consumers. In my industry, employees pay for the fuel that powers the vehicles I supply. If I could give drivers more fuel-efficient cars, they’d be lining up to work for me.”
Dennis McGinn, retired Vice Admiral, member of the CNA Military Advistory Board
“Gas-guzzling is not an American value. Cutting our oil use, increasing efficiency and diversifying our energy resources will protect our economy and our ability to move around the country freely. Programs like the new 54.5 mpg federal fuel economy standard … put us on the right path.”
Pete Bigelow · Midwest Memo: Obama Chides China, New Detroit Dock Boosts Michigan Tourism, New Owners For Gary Casinos
November 14th, 2011
Three stories making news across the Midwest today:
1. Obama chides China. Using uncharacteristic blunt language, President Obama said America had enough of China’s currency manipulation and encouraged the global power to abide by “the same rules as everybody else.” At the closing news conference of the Asia-Pacific Economic Cooperation summit, Obama told reporters, “Enough’s enough,” and that “we don’t want them taking advantage of the United States.” The comments came one day after Obama held face-to-face talks with President Hu Jintao, according to Reuters. Obama and other U.S. leaders have grown weary of China keeping its currency value artificially low, thus hurting American companies and jobs.
2. Detroit dock brings tourist upswing. When a $21.5 million dock opened in Detroit earlier this summer, critics doubted the facility would see much use. Although only two cruise ships visited the port this past summer, according to the Detroit Free Press, cruise-ship operators have scheduled 23 visits in 2012. The uptick is expected to bring 2,500 new visitors and an increase in Michigan tourism dollars. Calling it a “significant win” for the region, W. Steven Olinek, deputy director of the Wayne County Port Authority, told the newspaper, “in future years we hope to play an even greater role in the re-emerging Great Lakes cruise industry.”
3. Gary casinos have new owner. New Mayor-elect Karen Freeman-Wilson says new ownership for two bankrupt casinos in Gary, Ind. is good for both the casinos and the city. “Investment in their structure will attract more gamers,” she said. Freeman-Wilson tells our partner station WBEZ that money is needed for infrastructure improvements, especially fixing city streets. Attendance has dropped at Northwest Indiana casinos, according to recent numbers, a falloff that comes even before a proposed Chicago casino heightens competition. Wayzata Investment Partners in Minnesota has taken over at the Majestic Star Casinos, which owe the city up to $15 million.