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From Site Selection magazine, March 2016

Snapshots of Excellence

When schoolwork comes first, a qualified workforce follows.

Audible's global headquarters shares a building with the Rutgers School of Business. Audible, which continues to expand into neighboring buildings, started in Newark with 200 employees in 2007, and aims to reach 1,000 by the end of this year, in part fueled by a successful intern program.
Photo courtesy of Audible


When the Lumina Foundation last year ranked states and cities by their percentage of workforce population with at least an associate's degree, half of the top 10 states and the top 20 cities were in New England and the Northeast. This year, the newly released Quality Counts rankings from Education Week, which examine K-12 systems across the country, also cast favor on the performance of schools in the region — including in the all-important Chance-for-Success Index.

Pennsylvania, New Jersey and New York leaders are doing their best to increase those chances for their citizens, companies and communities.

One institution leading that charge is Penn State University, which can point to its own research for motivation.

A study of Inc. magazine's 5,000 high-growth firms led by a team of economists including Penn State Prof. Stephan Goetz, director of the Northeast Regional Center for Rural Development, found that not only did the growth companies pop up in industrially diversified regions, they also tended to like places with more highly educated people.

Rutgers Audible
Photo courtesy of Audible

"A higher number of bachelor's degrees in a community is associated with significantly more of these firms, both in terms of the probability that they are there and the number of those firms," said Goetz in a Penn State press release. "This suggests that university towns have a leg up in terms of spawning these types of businesses."

Tour the Northeast and you'll find a scrapbook's worth of examples.

Can You Hear Them?

Audible, Inc. is the ultimate education stakeholder, and it's not afraid to show it. The growing Newark, N.J., global headquarters of the world's spoken-audio leader (now an Amazon company) is also home to Rutgers Business School. The company, holder of 100 patents since 2008, is the lead sponsor of a new Choose New Jersey intern and apprenticeship program called Smart Students Choose New Jersey, which will reward the highest academically ranked graduating senior at each of the 44 public, private and charter high schools in the cities of Newark and Camden who choose to attend a New Jersey college or university with a one-time scholarship of $2,000 and a paid summer internship opportunity each year over three years.

Rutgers Audible
Photo courtesy of Audible

Newark now is one of 14 global centers for Audible. When Site Selection first interviewed founder Don Katz in 2011, the company occupied the top two floors.

"We now have part of 12, and all of 14 through 17," says Matt Thornton, Audible's vice president of communications. "We're on track to employ close to 1,000 people in Newark by the end of this year. We had about 120 employees when we moved here in 2007. It's pretty amazing."

Keeping the company amazing hinges on talent. Audible's first step eight years ago when it arrived ready to live out its mission to make a difference in a challenging city was to introduce itself to the neighbors.

"One of the first things we did after Audible moved our headquarters to Newark in 2007 was to focus our paid internship programs on Newark-born high school students," says Thornton. "The nationally recognized North Star Academy is right across Washington Park from our building. We've had a partnership with them since we moved here."

New Jersey has one of the highest high school graduation rates in the country – 88 percent vs. 81 percent nationally. Nearly 36 percent of New Jersey's workforce has a bachelor’s degree or higher, compared with 29 percent nationally — Northern New Jersey counties Morris (48 percent) and Bergen (46 percent) lead the way.

Audible currently has 24 interns in its building, says Thornton. "Their presence really makes Audible a better company," he says. "They really add to the environment in a way that has accrued positively to the way employees feel about working here. It's great."

Many have moved on to be Audible Scholars, a program designed to continue providing them mentoring and financial assistance when they go to college. Then they're ready to return to Audible. "We have hired several of them as full-time employees." Audible Founder Don Katz has voiced his concern that too many of the 40,000 college students in Newark — many of them the first in their families to go to college — won't want to come back after graduation because nothing is waiting for them there. Audible is making sure something is.

Rutgers Audible
Fields, forests, a compact area and a new building (pictured) for business students help define Livingston Campus or "Livi" in Piscataway, N.J., one of Rutgers University–New Brunswick’s five campuses.

"The idea is that top Newark and New Jersey high school graduates stay in New Jersey and go to college, and help drive this growth," says Thornton. "Since we've moved here, our commitment to being part of an urban turnaround has become a centerpiece of our company culture. We believe it can happen, but jobs need to be created at all levels."

Audible is prepping for that growth, as it renovates a neighboring historic church and two adjoining buildings to become a workspace for more engineers and technologists. Thornton says that project will take several years.

The company's university ties, meanwhile, couldn't be tighter: The HQ shares its building with Rutgers Business School. The company has partnered with Rutgers on an early-stage investment fund called Newark Venture Partners, which along with $50 million of capital (just closed) provides a companion 25,000-sq.-ft. accelerator workspace, with building services and 10 gigabits of ultra-high-bandwidth Internet access. The build-out is now complete, and the accelerator, led by angel investor Thomas Wisniewski, will welcome its first class of seedling startups this spring.

Other Newark businesses such as Prudential are working on similar programs, says Thornton, who points to a nice side benefit: "It's a value-add for Audible employees too. They will now be able to mentor startups, which is a big draw for tech recruits."

Bright, Very Bright

New Jersey's strong array of solar energy incentives and Buffalo's gigafactory from SolarCity aren't those two states' only assets when it comes to photovoltaics. They have bright minds too.

Stevens Institute Solar Leap

Stevens Institute of Technology, based in Hoboken, N.J., took top honors last fall in the US Department of Energy's Solar Decathlon 2015. But the school's energy extends well beyond alternative energy.
Photo by Thomas Kelsey/U.S. Department of Energy Solar Decathlon

Stevens Institute of Technology, based in Hoboken, N.J., took top honors last fall in the US Department of Energy's Solar Decathlon 2015, held at Orange County Great Park in Irvine, Calif. The University at Buffalo, The State University of New York, took second place, followed by California Polytechnic State University, San Luis Obispo in third.

Stevens won by designing, building and operating the most cost-effective, energy-efficient and attractive solar-powered house, dubbed the SURE HOUSE for its resilience attributes (a recurring theme in 2015).

The solar exposure for Stevens reveals an institution with a lot more going on than just solar power in terms of industry partnership and workforce development. Central to the team's success was the school's Product-Architecture Laboratory (PAL), a two-year Master's program focused on buildings that is housed in the School of Engineering and Science. That school, in the wake of Hurricane Sandy, is also becoming known for its expertise in resilience engineering.

Among the latest developments at Stevens is a second trading and finance lab — the school's undergraduate degree in quantitative finance is a popular major and a big part of Stevens' future. Concentrations in health sciences and cybersecurity are also part of a successful mix. And this spring, the School of Systems & Enterprises (SSE) at Stevens will welcome three technical leaders from BAE Systems, Lockheed Martin and TD Ameritrade as part of its new Executives-in-Residence Program.

Keystone Knowledge

Higher education institutions across Pennsylvania have impact that extends well beyond their lead campuses.

In February, Penn State University officials joined with leaders in Harrisburg, Pa., to launch the Center for Innovation and Entrepreneurship at Penn State Harrisburg. In May 2015, Penn State President Eric Barron awarded Penn State Harrisburg $50,000 as a part of his Invent Penn State initiative. Invent Penn State is focused on leveraging Penn State’s research, knowledge and entrepreneurial spirit to bring to market needed ideas, products and services. The seed funding helps to support the center and its activities.

Penn State Allison Beese
Materials Engineer Allison Beese studies how the microscopic structure of metals and alloys affects their strength and ability to bend in her University Park laboratory. Penn State’s research expenditures totaled $801 million for the 2014-15 fiscal year, marking the fifth consecutive year the university topped the $800-million mark.
Photo courtesy of Penn State

Penn State Harrisburg has aligned with the Dickinson School of Law in Carlisle and the College of Medicine in Hershey to create Invent Penn State in the capital region, which Barron called "a hub for talent and innovation, with ample resources in business, engineering, medicine, law, entrepreneurship and related fields." The Invent Penn State initiative also has provided seed grant funding for entrepreneurship center programs at five additional Commonwealth Campus communities, including Penn State Abington, Penn State Behrend, Penn State Lehigh Valley, Penn State New Kensington and Penn State Wilkes-Barre.

Last June, Penn State signed a memorandum of understanding with Alstom to establish a global center of excellence for microgrids at The Navy Yard in Philadelphia. The partnership strengthens the ongoing development and demonstration of microgrid technologies underway at The Navy Yard both as part of a $1.2-million grant awarded to Alstom by the U.S. Department of Energy in 2014, and the $129 million awarded to Penn State from the DOE in 2010. With the new center, Alstom expands its presence in the greater Philadelphia region, which is home to Alstom Grid’s North American headquarters and more than 100 employees.

Energy to Burn

Penn College is a special mission affiliate of Penn State, committed to applied technology education. Nearly 6,000 students are enrolled in the bachelor-degree, associate-degree, and certificate majors, relating to more than 100 different career fields. Companies from NuWeld to Halliburton have benefited from partnering with the school. But one of its shining lights is the ShaleNET Hub, headed by a former oil & gas land man and IBM systems enginee, John Strittmatter.

"Our specialty is applied technology — hands-on degrees," he says of Penn College. "I'm also a father of a student there, my 21-year-old daughter getting her four-year bachelor of science in welding engineering. She' s good at it, and likes it a lot."

The college manages the state's largest worker training program, with an existing workforce training program that has an average enrollment of 8,200 across all industries. Strittmatter says ShaleTEC has trained more than 14,000 employees since 2009, in short-term training for the region's booming shale gas activity. An Energy Technology Education Center opened in 2012, followed later that year by the awarding of nearly $15 million in federal grant money to ShaleNET by the US Dept. of Labor. Today Strittmatter is reinventing the program to a charge-based model as the organization rolls off that grant. He has plenty of evidence to support paying up, including a sometimes breakneck pace that means time-and-a-half pay by Wednesday a lot of weeks.

Severin Hacker
Duolingo Co-founder Severin Hacker
Photo courtesy of Duolingo

"We started in Pittsburgh because we were in Carnegie Mellon and were not clear it was going to take off like it did. We stayed because what we need to hire is engineers. The brightest engineers are coming out of CMU."
— Duolingo Co-founder Severin Hacker

"We had a student who was working offshore in Texas, got laid off, and wanted to get more certifications," he says. "He went thrugh the three-week training program, was picked up by a bridge-building company as a project manager, and is making $100,000 a year. It was underwritten by the DOL grant. It was $1,000 for the three weeks, a huge bargain."

Across the state in Pittsburgh, Uber and Carnegie Mellon University announced last September that Uber would give $5.5 million to support a new robotics faculty chair and three CMU fellowships, following on a larger partnership announced last February that includes the creation of the Uber Advanced Technologies Center in Pittsburgh, near the CMU campus.

"Faculty chairs and graduate fellowships are vital to CMU’s twin missions of research and education — and help the university continue to attract the world’s best roboticists," wrote Uber CEO Travis Kalanick in a blog post. "In addition, we’re pumped to be part of a growing innovation ecosystem in Pittsburgh that includes world leading research institutions and companies, as well as an increasing number of start-ups."

In 2014, CMU partnered with Google in a similar fashion (to explore the potential of MOOCs, or massively open online course offerings) and with Duolingo, the CMU spinoff that provides free online language education. And last year those two parties came together, as Duolingo closed a $45-million investment round backed by Google Capital.

Named the iPhone app of the year in 2013 by Apple, Duolingo in two years has grown to 100 million users. Its Pittsburgh HQ employs 47. "We started in Pittsburgh because we were in CMU and were not clear it was going to take off like it did," Duolingo Co-founder Severin Hacker says. "We stayed because what we need to hire is engineers. The brightest engineers are coming out of CMU."

Is START-UP NY the Answer?

In February, Gov. Andrew M. Cuomo announced $35.3 million in grants for capital projects at higher education institutions across the state from the Higher Education Capital Matching Grant Program. But the real capital is slated to come from the START-UP NY program, launched in 2014 and offering new and expanding businesses the opportunity to operate tax-free for 10 years on or near eligible university or college campuses in New York State. According to the most recent figures, 157 business have joined START-UP NY and committed to create 4,278 new jobs and invest over $225 million across the state.

Rutgers Audible
This rendering shows the new High Pharmacy Oncology Manufacturing Facility Athenex will construct in the Chautauqua County city of Dunkirk, N.Y., part of a 1,400-job pledge announced in February that includes a 500-job headquarters expansion at the Buffalo Niagara Medical Campus near the University at Buffalo.
PRNewsFoto courtesy of N.Y. State Executive Chamber

Among them is Empire Brewing Co., sponsored by SUNY Morrisville, which broke ground last spring on the Empire Farmstead Brewery – a new manufacturing and agri-tourism facility in Cazenovia, Madison County. Empire Brewing is the first START-UP NY company located in Central New York to break ground on an expansion project. When completed, the 28,000 square-foot Empire Farmstead will be the largest farm brewery of-its-kind in New York State, with a major agri-tourism component, including growing many of the raw ingredients for its beer production. The project will result in more than 50 new jobs in Madison County while nearly $6 million is invested in the local economy.

In December 2015, Cuomo announced that 16 more businesses plan to expand in or locate to New York State as a result of the program, pledging $43 million and promising to create nearly 470 jobs.

“SUNY is proud to be a critical component of Governor Cuomo’s START-UP NY program, truly the boldest economic development initiative in the nation," said SUNY Chancellor Nancy L. Zimpher. "There is no better way to grow jobs and opportunity than at the crossroads of business, government, and higher education."

Adam Bruns
Editor in Chief of Site Selection magazine

Adam Bruns

Adam Bruns is editor in chief and head of publications for Site Selection, and before that has served as managing editor beginning in February 2002. In the course of reporting hundreds of stories for Site Selection, Adam has visited companies and communities around the globe. A St. Louis native who grew up in the Kansas City suburbs, Adam is a 1986 alumnus of Knox College, and resided in Chicago; Midcoast Maine; Savannah, Georgia; and Lexington, Kentucky, before settling in the Greater Atlanta community of Peachtree Corners, where he lives with his wife and daughter.


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