< Previous98 NOVEMBER 2024 SITE SELECTION more deeply ingrained business networks, greater availability of fi nancing and a concentration of talent, which provide a boost to MSMEs that struggle to access these competencies.” Of course, those same attributes provide a boost to big fi rms too. “Businesses large and small should reconsider whether they have an adversarial approach to one another,” the report states. “Policies that attempt to create incentives, quotas, or protections that tilt the balance toward either small enterprises or larger ones aren’t necessarily the solution. e truth — broadly — is that both MSMEs and large companies can benefi t when they are operating within the right economic conditions. Large companies could help smaller companies acquire competencies — but it’s not a one-way street. Small companies help large companies as customers, suppliers, and sources of new ideas. In fact, the productivity of large and small companies tends to move hand in hand in most sectors. Boosting interactions between them could raise overall productivity for everyone.” I asked Olivia White, a co-author of the report who is senior partner at McKinsey & Company and a director of the McKinsey Global Institute, about the balance of big and small enterprise success and how it relates to location. “In terms of economic contribution of micro, small, and medium enterprises, as economies evolve, there is a natural progression of employment shifting to larger enterprises,” she says. “ is progression can play out in diff erent ways — some MSMEs scale into larger companies, others may be acquired by larger enterprises, and some may even cease operations and make room for new businesses. But even in the most advanced economies we studied (Italy, Portugal, Israel, Japan, Spain, Poland, Australia, Germany, UK, U.S.), MSMEs PLACES TO GROW FAST TOP TEXAS CITIES BY NUMBER OF 2024 INC. 5000 FIRMS CITY NO. OF INC. 5000 FIRMS Austin 108 Dallas 82 Houston 69 Irving 22 Plano 17 Fort Worth 16 San Antonio 15 Richardson 10 Frisco 9 Addison 9 Grapevine 5 The Woodlands 4 McKinney 4 Flower Mound 4 Carrollton 4 Austin Dallas Fort Worth Irving Richardson Addison Grapevine Plano Frisco Carrollton Flower Mound McKinney Houston The Woodlands San Antonio Three metro areas rank in the top 15 nationally: No. 7 Dallas-Fort Worth-Arlington (206 fi rms); No. 11 Austin- Round Rock-San Marcos (124); and No. 14 Houston-The Woodlands-Sugar Land (99).100 NOVEMBER 2024 SITE SELECTION continue to contribute two-thirds percent of all business employment on average, and more than half of value added.” In the study, she says, there was no correlation found between the stage of development/ income level of the states and the presence of small businesses. “But there is a good place to be when you look at the performance of large and small businesses,” White notes, referencing a graph of the study’s results showing MSAs and states where both small the large businesses perform above average. They include Texas and other top states in Site Selection’s rankings, as well as metro areas such as Houston, Chicago, Indianapolis and Charlotte. “Across geographies,” White says, “we observe that the performance of large and small businesses goes hand-in-hand, as local variations — policies, economic conditions, infrastructure and networks — tend to influence the productivity of businesses of all sizes.” The report cites a few examples of clusters where all sizes can thrive: “Today, Napa wineries, Dalton carpet companies [in Georgia], and High Point furniture factories [in North Carolina] are a mix of big and small businesses, and in many cases still include family-run operations,” the report says. “They succeeded not only because of their product but also because of their ability to efficiently produce it at scale. The regions’ success illustrates how, under the right conditions, micro-, small, and medium-size enterprises (MSMEs) in any industry can expand their global reach.” All Grow Where Tech Grows As Dr. Koduru suggests, fast growth and tech growth can be mutually complementary. Statistics from the annual CyberStates tech jobs report from CompTIA comprise two of our 14 metrics. “States that experienced notable tech employment gains include Texas, Florida, New York, North Carolina and Washington,” the organization said at the release of the report in April 2024. Notably, while states with smaller, more spread-out populations led in tech job growth on a percent change basis, Texas was right there in the top five too. Among other CyberStates highlights relevant to our top-ranked states: • Virginia is No. 3 (just behind its nation’s capital neighbor District of Columbia) in net tech employment concentration at 8.9%. • “On a numeric basis, Florida had the largest year-over-year increase of net new tech business establishments (+2,474). Rounding out the top five for net new tech business establishments were Virginia, Texas, New York, and North Carolina,” i.e. four out of the top five were among this year’s top five business climate states. • Texas and Florida are among the top six states in terms of the tech sector’s direct economic impact. • While California leads most tech employment categories, Texas, Virginia and Florida were among the top five states for employer hiring activity via tech job postings in 2023. And Texas (46,530), Virginia (31,089) were No. 2 and No. 3, respectively, by number of emerging tech job postings. Employment and talent, after all, are where the rubber meets the road. Dr. Koduru and his team know that’s true in more ways than one if his company is to continue prospering in Prosper. “One reason we even entered the nursing space in 2020 was seeing how much of a crisis nursing was facing,” Koduru says. “We thought, ‘Hey, increase the pass rate by 10 percentage points, you’re adding 30,000 nurses a year to the workforce.’ People complain about shortages, but there’s not enough emphasis on Digital brokerage platform company Altruist just moved into this new office space in Dallas. Photo by Wade Griffith Photography courtesy of Tangram Interiors Olivia White, Senior Partner, McKinsey & Company and Director, McKinsey Global Institute102 NOVEMBER 2024 SITE SELECTION improving the pass rate. Why is that person who went through the entire nursing school failing this final exam? That would help solve the shortage.” It Takes Talent to Cultivate Talent It’s a shortage that continues to increase. Even as the company has served around 200,000 nurses in the past year, the next step is collaborations with hospitals, he says, in order to help retain and upskill that workforce. “We know how they perform on their test screen levels. Is there a way to intervene, get more feedback from them and help them with their careers in the future? If we step in the hospital and make sure they are retained, we listen to their problems and help them upskill. I think that will really help the shortage.” Koduru says one challenge to be confronted in Texas and everywhere else is the fact that immigrant talent comprises so much of the nursing workforce, but is met with visa and citizenship roadblocks. He himself was so impatient as a practicing oncologist who had paid taxes and contributed to society for 12 years that he went the EB-5 route instead. “The U.S. is dependent on international nurses,” he says. “Thirty percent of those 200,000 are international and 30,000 to 40,000 take our course every year. But they have put nursing in the same bucket as other immigration. Nothing is being done about it. International nurses are passing this exam but aren’t able to come on time. There are signed contracts, but hospitals are still waiting.” Meanwhile, domestic workforce development continues. Asked how he’s interacted with the widely praised community college and higher education system in Texas, Koduru says, “It’s funny you bring that up. We just had a call with the Dallas Regional Chamber yesterday asking us how we’d like to get involved as a strategy partner.” Providing tools for community college students before and after they take their boards is one potential avenue as professionals continue to upskill. “That’s our focus,” he says. “An entry-level nurse and then see their journey through school. After graduation, upskill them so you create value for these hospitals, if they are willing to invest in their employees. Increasingly hospitals are realizing, ‘Why don’t we just upskill our nurses so we can retain them?’ Be interested in their growth and higher pay scale. The retention will automatically come. Turnover is great for staffing agencies, but not so great for hospitals and budgets. If an RN wants to become a nurse practitioner, we have courses for them, and also hold their hands in that journey … It has such a big impact on their entire family. Nurses come from various socio-economic backgrounds, and it’s important to be accessible and affordable.” The company attracts between 1,000 and 1,500 students every day to its live webinar courses. It’s all about employee retention, with health care education serving also as a tool to solve the staffing crisis, Koduru says, training nurses to fill gaps that include serving in remote areas. “I brought this up with the Regional Chamber, and they said there are a lot of opportunities. We still have to explore that area.” The company is exploring following the nursing school model for medical schools too. As it does so, retaining talent at Archer becomes more of a priority too. “Our employees are spread out, but we’re trying to get the Texas team together and have them all here,” Koduru says, as the roster builds up with nurse practitioners, physician’s assistants, illustrators and other roles. Regardless of location, most company discussions occur in Slack, he says. At the same time, “once we find a contractor who delivers good work and fits into the cultural vibe of the company, we try to absorb them,” he says. “People are pretty comfortable doing teaching from different places. But I do believe we need to have at least part of the team physically present in the office at least two days a week. There is more WHAT MATTERS MOST SITE SELECTORS’ MOST IMPORTANT LOCATION CRITERIA 1. Utilities (availability, cost, reliability) 2. Workforce skills 3. Land/building prices and supply 4. Ease of permitting and regulatory procedures 5. Transportation infrastructure 6. Workforce development 7. Quality of life 8. State and local tax scheme 9. Economic development strategy 10. Higher education resources SITE SELECTION NOVEMBER 2024 103 brainstorming and dialogue.” And location matters for fostering such dynamics. “A lot of restaurants are full in the evenings, with people basically discussing business,” he says. “It’s a different thing: You’re having fun, but discussing ideas. There’s a vibe of startup culture San Francisco has always had, but it’s being seen in Dallas these days.” Other states can compete, he says, but “it’s hard to beat Texas because of the infrastructure being developed. Entrepreneurs want to see construction and building. You see building happening all over here.” Data entry and analysis for this report conducted by Karen Medernach, McKenzie Wright, Brian Espinoza and Daniel Boyer. BUSINESS CLIMATE RANKING METHODOLOGY ; Executive Survey ; 2023 Governor’s Cup ranking (published March 2024) ; 2023 Per-Capita Governor’s Cup Ranking ; 2024 Conway Projects Database Rank YTD ; 2024 Conway Projects Database Rank Per Capita YTD ; 2024 Tax Foundation State Business Tax Climate Index Ranks: Corporate Tax Rate Ranking and the Property Tax Ranking ; 2024 Inc. 5000 Companies Per State ; 2024 Inc. 5000 Companies Per Capita Per State ; Overall Ranking from 2024 Rankings that Matter (January 2024 issue) ; CNBC 2024 Top States for Business ; CompTIA State of the Tech Workforce 2024 Tech Job Statistics (CyberStates report, April 2024): ; CompTIA State of the Tech Workforce 2024 Tech Job Statistics Per Capita ; Bipartisan Infrastructure Law (BIL) project dashboard ; BIL Investment (Funding)104 NOVEMBER 2024 SITE SELECTION W earables, robotics and AI are just three technologies driving the evolution of the medical devices industry. Locations with access to expertise in those and other IT fi elds will likely have an edge in attracting capital investment in this critical sector. But labor supply in general remains a key location consideration as device manufacturing requires many other skillsets, technical and otherwise. Analysis from Statista lists in vitro diagnostics, cardiology, diagnostic imaging and orthopedics as the leading segments in the medical technology industry, so project numbers for companies in those areas will likely grow. One region seeing increasing investment from medical device by MARK AREND mark.arend@siteselection.com MEDICAL DEVICES & EQUIPMENT A Japanese priestess performed the Ji Chin Sai ceremony, a time-honored practice to bless the land and pray for the safety and success of the construction. Japanese Project Help G w A North Carolina ClusterA Thriving Biotech Hub If you’re considering a location for your medical device company, look no further than Vacaville, California. This vibrant city is not only a growing hub for the medical device industry but also offers the perfect blend of resources and affordability that is increasingly hard to find. In the heart of Northern California, a remarkable transformation is underway. Vacaville is rapidly establishing itself as a premier destina- tion for medical device and instrumentation companies, fueled by a vibrant biotech ecosystem and a commitment to innovation. Companies like Mettler-Toledo RAININ thrive in this environment and it’s clear that Vacaville is not just a place to do business—it’s a community designed for growth. A Highly Qualified Workforce The city is home to a dedicated workforce of over 1,300 biotech professionals, ready to contribute their expertise to your organization. Vacaville’s proximity to leading academic institutions, such as UC Davis, UC Berkeley, and Stanford University, means a continuous influx of highly trained graduates equipped to meet the demands of the medical device industry. With access to these top-tier universities, Vacaville benefits from cutting-edge research and a pipeline of talent. These institutions not only provide education but also engage in research collaborations that can support your company’s growth. But that is not the limit to Vacaville’s employment pipeline. Solano College, located in Vacaville, is one of just a few community colleges that offers a four-year degree program with off-ramps along the education journey. What does this mean for your company? Vacaville’s access to talent spans the organizational hierarchy setting partner companies up for suc- cess from top to bottom. An Affordable and Vibrant Community Vacaville’s affordability is another key draw for medical device compa- nies. As one of the most cost-effective business communities, it also has attainable housing costs, which offers employees the unique opportunity to live where they work. This proximity enhances quality of life, reduces commute times, and fosters a strong sense of community. Vacaville offers an exceptional quality of life, with a range of amenities that enhance the living experience for employees and their families. From parks and recreational activities to cultural events, there’s something for everyone. Vacaville is more than a place for industry, it is a place to do life. A Supportive Business Environment Vacaville’s leadership is dedicated to fostering a thriving biotech industry. Mayor John Carli notes, “Working with our biotech industry and education partners, we developed a strategy that will bring more biotech companies to Vacaville.” This includes strengthening the Economic Development Department, establishing a Biotech Zone for specialized uses, and launching the Biotech Fast Track program, which guarantees expedited review and approval processes for new ventures. Vacaville boasts over 1 million square feet of available manufactur- ing facilities, making it easy for companies to find the right space for their operations. This robust infrastructure supports both research and manufacturing, enabling seamless transition from concept to production. The combination of space, affordability, and talent positions the city as an ideal locale for companies seeking to expand or relocate. Building a Robust Bio Ecosystem As the City of Vacaville continues to grow and develop its medical device industry, the opportunities for collaboration and innovation are endless. With a comprehensive plan and significant investments in place, Vacaville is positioning itself as the premier location for medical device manufacturing in Northern California’s dynamic life science market. This is your chance to be part of a thriving community committed to your success. Make The Smart Move Choose Vacaville, where access, affordability, and a qualified work- force converge to create a winning formula for growth. Discover why the City of Vacaville is the right choice for your medical device company. Embrace the future of biotech innovation in a community that’s dedicated to your success! Connect with the City of Vacaville https://www.facebook.com/cityofvacaville/ https://www.instagram.com/cityofvacaville/ https://x.com/cityofvacaville https://www.youtube.com/CityofVacaville https://www.linkedin.com/company/city-of-vacaville/ https://www.cityofvacaville.gov/EconomicDevelopment The City of Vacaville Has a Formula For Success ADVERTISEMENT Dia de Los Muertos Celebration Courtesy of Mettler-Toledo RANINNext >