Louisiana can drive future growth by hanging onto graduates and millennials, providing job and entrepreneurship pathways for all and embracing the digital economy, according to speakers at the annual Statewide Economic Development Summit.
"What's the difference between a community like Austin and a community like Columbus, Ohio? They're both college communities …. The difference is that in Austin, the millennials stay," said Gregory Burkhart, managing director of Duff & Phelps, site selection experts.
Burkhart was one of several speakers at the summit attended by about 400 community and economic development officials.
If Baton Rouge and New Orleans want to be like Austin, Texas, a location companies flock to, they must do the same.
Ninety-four percent of University of Texas graduates stay in Austin each year, Burkhart said. If Baton Rouge retained 75 percent of its college graduates, after one year the growth rate of millennials, those ages 15 to 34, would jump from 6.6 percent to 13.9 percent.
Nationally, the millennium population is growing at 7.5 percent.
The New Orleans area has a tougher task because its millennial population shrunk by 26 percent over the past 15 years, Burkhart said. Retaining 75 percent of college graduates would reduce the millennial losses to 22 percent in one year.
If both cities maintained the kind of retention rate Austin enjoys, the differences would be dramatic, Burkhart said. Each year, the gains compound. So after four years, Baton Rouge's millennial population would jump by 42 percent. New Orleans would still have fewer millennials than it did 15 years ago, but only by 7 percent.
"That's what you need to do," Burkhart said. "Some of the numbers don't look good, but there are fixes for it."
One is setting annual goals to improve the retention of college graduates. Another is making the kind of improvements taking place in downtown Baton Rouge, with apartments and other lifestyle offerings.
Burkhart also suggested that Louisiana use some of the numbers that do look good — lower than average wages for information technology and financial services — to recruit new businesses.
Louisiana's average pay for information technology workers is $50,000 a year, compared with $88,000 nationally. For financial services, Louisiana's average pay is $62,000, compared with $94,000 nationally.
However, Burkhart said the state may need to address one number: average pay for workers in manufacturing. Louisiana's manufacturing workers average $68,000 a year, well above the $55,000 national average.
Rodrick Miller, former president and CEO of Detroit Economic Growth Corp., said another demographic, the minority population, also offers opportunity for economic growth.
By 2042, minorities will make up the majority of the U.S. population. Changing demographics, along with global competition and disruptive technology, are the biggest forces affecting the country's economy.
"The economic well-being of people of color represents the future of our country," Miller said.
Right now there are segments of the population that don't have access to the economic on-ramps that provide access to job and entrepreneurship opportunities. The divide between the haves and the have-nots is larger than at any time since the Golden Age, a period that lasted from after the Civil War to the Great Depression.
Miller said one thing essential to creating a more inclusive economy is putting tools in the hands of people.
"You can have all the programs all day long, but if people don't know about them and they're not accessible to them, they're useless," he said.
In Detroit, Miller helped oversee programs that distributed close to $3 million in matching grants to 570 businesses and D2D, a business to business program that boosted a 17-company Buyers Council's purchases from Detroit companies to $925 million in 2014 from $550 million in 2012.
The programs leveraged philanthropic and government funding with small businesses, which are more likely to offer jobs to someone from the neighborhood, Miller said. Those sorts of efforts are part of creating an inclusive economy.
Roberto Gallardo, leader of the Intelligent Community Institute at Mississippi State University Extension, said the digital economy is disruptive but also offers opportunity, even for rural mom-and-pops who are able to get aboard with the right technology and know-how.
"The U.S economy is running at 18 percent of its digital potential. So there is plenty of room if urban and rural can hop aboard a train that's moving quickly, Gallardo said.
One of the challenges for rural communities is providing broadband.
Gallardo is frequently asked if a rural community needs faster internet service. That's like a person asking why use electricity since they already have candles, he said. Communities that want to retain their millennials need to be digital-ready. At the very least, communities need to offer Wi-Fi hotspots and engage digitally with their residents. Otherwise, their young people will leave for larger cities.
Gallardo touted the intelligent community model, which focuses on broadband, the knowledge workforce, innovation, sustainability, advocacy and digital equity. The digital divide is the biggest threat to the digital economy, he said. More than half the world's population is offline, and that gap is already being felt.