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The importance of talent to a regional economy cannot be overstated. Industries from advanced manufacturing and construction to IT and biotech have identified the lack of skilled workers as a major barrier to economic growth. This is also reflected in economic journals as the availability of skilled labor now ranks above both infrastructure development and investment incentives as the most critical factor in economic development.
That is the reason why the Labor Department is so deeply engaged in regional economic strategy discussions all across the nation and why we have developed Workforce Innovation in Regional Economic Development – our WIRED Initiative.
WIRED is based on the three truths of regionalism, partnerships, and talent development and seeks to demonstrate that by developing strategies to address these issues, a region can transform its economy and be successful in the global economic competition.
WIRED began almost a year ago when we selected 13 regions to be a part of the First Generation of WIRED. Your neighbors just to the north of here were one of those regions, receiving a sizable investment from the Labor Department acting as seed capital to bring economic development and job growth to the North Central Indiana region.
We quickly realized that there was a strong desire around the country to integrate workforce and economic development and follow the concepts of WIRED, so last April, we decided to add a second tier of WIRED called the virtual regions. You and the other Virtual Regions received the tools, participated in the Academies, and followed the progress of WIRED, but did so without an investment from DOL. That has now changed.
This past February, Secretary Chao announced that we are investing $5 million over the next three years in each of these regions, supporting your economic and talent development strategies and hopefully catalyzing investments from other partners in the state and the region. We took our Virtual Regions and made them the 2nd Generation of WIRED.
The first thing you should be aware of is that WIRED is not your typical ETA grant. We actually don’t like to call it a grant at all. Instead, it is a force; a force for economic and systemic transformation in a region.
Each of our 1st and now 2nd Generation WIRED regions are participating in a 5-step process that we call the WIRED conceptual framework. Those steps are:
- Defining the regional economy by identifying the surrounding communities that share common characteristics;
- Creating a leadership group that represents the major assets in the region;
- Conducting a regional assessment to fully map the area’s assets and identify the strengths, weaknesses, opportunities, and risks;
- Developing an economic strategy and corresponding implementation plan that focuses on talent development and identifies specific goals and tasks; and
- Identifying resources from a wide range of public and private sources to execute and support the plan.
This is not a linear process, but a cycle where different industries require different regional definitions and different assets.
The second important point about WIRED is that you’re going to hit the ground running. Of the $5 million investment, $500,000 is available to the region right now. To access the remainder of the funds, we are asking each of the 2nd Generation regions to develop a comprehensive implementation plan. This plan should show not only how you’ll use our investment, but also how other existing and new funds will support the overall economic strategy for the region.
For example, ETA sends $98 million a year to Indiana just for WIA programs. How are those funds and the activities of the Workforce Boards and One Stop Centers going to be aligned with the region’s plan? This is, in fact, a major goal of the entire WIRED Initiative, to ensure that the public workforce system, which ETA oversees, becomes an integral part of every region’s economic and talent development strategy.
And what about all the other federal agencies? From Rural Development at the Dept. of Agriculture, to the Small Business Innovation Research programs at the National Science Foundation and the Pentagon, to the Economic Development Administration and the Manufacturing Extension Partnership at the Dept. of Commerce, ETA has developed an extensive partnership network across these agencies that we hope you will utilize and incorporate into your plan.
I mentioned foundations earlier. The Mott and Kauffman foundations are heavily involved in some of our WIRED regions already, and other like Gates and Casey have missions that directly align with the priorities of WIRED. How can these resources be identified and leveraged in support of your economic vision.
As you can see, WIRED really isn’t just another grant. It is a force and a framework for economic and talent development.
It is our belief that talent development is the lifeblood for innovation, and the hallmark of an innovation economy is the ability to freely move ideas to market. This ability is one of the major goals of the WIRED Initiative and the overarching goal of all of the regions. This process is known as the innovation lifecycle and it is a key to creating perpetual economic growth.
This cycle begins with knowledge creation. Through investments in research and development and protection of intellectual property, universities, research institutions, and companies are enabled to create the break-throughs that lead to new products, product features and services, and new markets.
These break-throughs must then be moved out of the university or spun-out of large companies through technology transfer policies. This includes small business incubators and research parks, and it also includes access to risk-capital, which is the support entrepreneurs need to get their business off the ground.
From there, the growth of products and new industries takes place through commercialization. And finally, ideas reach maturity as new clusters and business networks form around industries. This then allows successful clusters to reinvest in research and development and start the innovation lifecycle again.
Some of today’s most innovative economies are seeing the fruits of their labor on a regular basis in places previously unheard of prior to globalization. By embracing the practices involved in the innovation lifecycle, regions such as Boston and Silicon Valley have emerged as major centers for innovation and subsequently, the breeding grounds for some of the best talent our world has to offer. All they needed was a spark to ignite their rapid growth, which has attracted companies rooted in innovation to tap into their pool of talent. So with one of the main ingredients already in place – talent – why not Southwestern Indiana?
It is my hope that WIRED will be the spark your region and other regions will need to keep America competitive in today’s economy. Hopefully, the legacy of WIRED will be a lasting leadership group, incorporating a full array of regional partners and supported by on-going programs from public, private, and non-profit sources.
I know that the goals of WIRED are ambitious, but they can and must be achieved if the citizens of this region, this state, and our nation are going to compete and succeed in the global economy.
Thank you very much for the opportunity to visit your region and I look forward to working with you in the months and years ahead.
