New York State’s “Industrial Policy”–Take One

With the federal government essentially paralyzed when it comes to economic growth strategies, I and others have long concentrated on the roles that states, cities and regions are playing in creating jobs. I’ve recently had contact with several officials involved in New York State’s economic development efforts and, when added up, their stories are quite impressive. New York State and City are finding new means of spurring growth. Governor Andrew Cuomo, a Democrat, gets some of the credit, but so does former New York Mayor Michael Bloomberg, a Republican. These economic growth strategies don’t have to be politicized–there is surprisingly common ideological and political ground to be plowed.

First, at the NERETA Job Creation Summit in Scranton, Pa, on June 14-15, which I helped organize, I interviewed Laurence P. Gottlieb, president and CEO of the Hudson Valley Economic Development Corporation. He has identified several clusters and helped s establish another. His role has been a blend of branding what already exists and encouraging new cluster development. The first cluster is called NY BioHud Valley, a concentration of biotechnology companies that are physically located near Route 9, not far from where I live. Regeneron has been there the longest and you might call it the anchor tenant. But many others have taken root as well. Royal Philips has located its genomics team in a BioHud incubator and Sapience Therapeutics, moved there in July 2016. Meanwhile, Fareri Associates is spending up to $1.2 billion to build the Westchester Bioscience & Technology Park.

A second cluster is food and beverages. This is not a high-tech cluster of the sort that I have written about, but it shows how concentrations of activity can be leveraged. By working with the Culinary Institute of America, Gottlieb’s corporation has encouraged the development of specialty foods and craft breweries. At his count, there are 139 breweries, wineries and distilleries in the six-county region. The existence of these highly desirable foods and beverages has, in turn, helped attract companies and individuals to the BioHud cluster. The type of people who work in high tech like to have access to great lifestyles. Again, Gottlieb did not create this cluster. He helped spur its growth in part by giving it a name and promoting it.

The most surprising initiative Gottlieb has pulled off involves three-dimension (3D), or additive, manufacturing, a brand new technology that is just now beginning to take off. He met the head of MakerBot, one of the leading small firms in 3D which was purchased by Stratasys. It is the largest company in 3D printing. Gottlieb was able to persuade Stratasys/MakerBot to locate a research and teaching lab on the campus of SUNY New Paltz. It turns out that the university’s strong concentration on the arts meant that there were many students interested in learning how to use 3D printing to make props for staging plays and such. The state kicked in $10 million for the project and the school has created an 18-credit minor in digital design and fabrication. Suddenly, SUNY New Paltz has gone from being a second-rate party school to the center of a hot new industry. Gottlieb was able to pull together the key players in this effort–the private sector, a university and the state.

I also learned that elsewhere in upstate New York, long a region that has lagged behind the rest of the country because its industrial base was essentially wiped out, a concentration of nanotechnology and semiconductor activity has been established in and around Albany. This was a conscious Cuomo strategy, but it depended in part on a collaboration among 20 regional chambers of commerce, 111 school districts and 345 schools. They created classes that trained young people in the skills sets that would be necessary to attract major manufacturers. And it worked–Global Foundries, one of the world’s biggest semiconductor companies, located a factor in Malta, near Saratoga Springs, in 2012. The region is now calling itself Tech Valley. Here is a story about it all.

More to come.

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