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ETROIT — It wasn’t that long ago that pundits and pols alike were lamenting the demise of the Motor City and the state to which it belongs.
There is little such talk now. Winning Site Selection magazine’s coveted Governor’s Cup for a record fourth year in a row (see the March 2001 Cover Story), Michigan is firmly entrenched as the crown jewel of economic development. Anchored by a robust economy in Detroit, which produced a total of 1,163 new and expanded corporate facilities that met the criteria of the Governor’s Cup competition, Michigan can proudly claim the mantle of national leader.
It wasn’t easy. Faced with the layoffs of the Rust Belt plant closings of the 1980s and early 1990s, Michigan needed to adopt a new approach to economic development — and that’s exactly what it did. Under the leadership of Gov. John Engler, Michigan cut taxes, invested more money into business recruitment and retention, and adopted a decidedly pro-business stance in most of its legislation.
The governor continued that agenda in 2000 by signing bills granting tax credits for job creation in the high-tech sector and authorizing the creation of up to 10 High Technology Smart Parks throughout Michigan.
The results speak for themselves: Michigan leads all states not only in the total number of new and expanded facilities (2,358) for 2000, but also in the total number of new manufacturing facilities (282) for the year. Detroit also won the statistical battle among large metropolitan areas for the title of biggest new plant producer, generating more than double runner-up Chicago’s 407. Moreover, third place went to another Michigan location — Grand Rapids-Muskegon-Holland — with 387 new facilities.
Webster’s Dictionary defines “dynasty” as “a powerful group or family that maintains its position for a considerable time.” Using that definition, Detroit and Michigan aren’t the only locations that can qualify as an economic development dynasty.
Ohio, Michigan’s next-door neighbor to the south, must also qualify. With 3,425 new and expanded plants over the last three years, the Buckeye State ranks third nationally — ahead of such traditional powerhouses and much larger states as New York, Texas and Florida.
Furthermore, the strength of Ohio is contained not just in its Big Three metros of Cleveland, Columbus and Cincinnati, but also in its robust small towns. Of the Top 100 Small Towns in America (see story), Ohio accounted for 22, more than any other state.
Places like Findlay, Union Township, Fremont, Wooster, Marion, Sidney and Zanesville may not exactly be household names to most Americans, but all of these Ohio cities are ranked in the top 20 small towns for new and expanded corporate facilities from 1989 through 2000.
This, of course, is no accident. The public and private leadership of Ohio determined years ago, under the direction of then-Gov. George Voinovich, that the state would aggressively pursue diversification so that its economy would not be so dependent upon the fortunes of the automotive industry. This concerted, statewide effort helped land Ohio its own Governor’s Cup “threepeat” from 1993 to 1995.
Today, Ohio is embarking on an even more ambitious venture as it pursues Internet telecom hotels in Cleveland and dot-com retail giants in Cincinnati (see our Ohio Spotlight story).
As Steven Kelley of the Ohio Department of Development says, “technology has become pervasive throughout our economy, and now all of our industries are adopting new processes and new product lines.”
There is much that the rest of the nation can learn from Michigan and Ohio, two modern-day dynasties that prove there is economic life after a recession.
