Rhode Island Innovates 2.0
Rhode Island has achieved one of the biggest drops in unemployment rates in the U.S.—from
11.2% in 2010 to 3.5% today. More than 20 new policies and programs aligned to support this growth, encompassing tax and regulatory reform, workforce development and talent attraction, quality of place, innovation and R&D, and supplier and industry cluster networks.
Despite substantial progress, a new round of policy and practice innovation is needed to
continue the trajectory—both doubling down on programs that are succeeding and responding to new threats and embracing new opportunities. Urban scholars Luise Noring and Bruce Katz recommend three main areas of focus, with 17 tangible and feasible suggestions for change.
By Luise Noring, assistant professor at Copenhagen Business School, and Bruce Katz, founding director of the Nowak Metro Finance Lab at Drexel University
Photo: Vincent BrancifortiUnsplash
After a decade adrift, Rhode Island’s faltering economy is on the mend and expanding anew. Following the Great Recession, Rhode Island’s economic recovery lagged behind the rest of New England, but recent progress indicates that the state’s economy has passed an inflection
point. The Rhode Island economy is growing, unemployment levels are at historical lows, average productivity has reversed its decline although it remains below the 2010 level, and advanced industry sectors are expanding with positive, reverberating effects for small businesses across the state.
Rhode Island’s nascent comeback is creating visible signs in the state—along the Providence River at the new Innovation & Design District, at Innovate Newport’s new co-working space, at Electric Boat’s new submarine production facility in the Quonset Industrial Park, in the Offshore Wind Farm near Block Island, and at the new Fascitelli Center for Advanced Engineering at the University of Rhode Island. As important, but less visible, are the thousands of Rhode Islanders who now hold quality jobs with decent wages due to customized training and the scores of companies that have expanded their businesses due to strategic investment and support. The turnaround of the Rhode Island economy is, however, still in its early stages. The creation of a solid platform for long-term prosperity is a decade-long project at a minimum, which needs sustained focus and integrated action across all sectors, including but not limited to the state government. The Rhode Islanders we have engaged with urged us to recommend maintaining (if not expanding) the programs
to continue building upon the progress that was initiated only a few years ago. Declaring victory and “turning the page” too quickly would only limit the potential future growth from the groundwork that has been laid.
Rhode Islanders also implored us to focus on challenges that have become more pressing and apparent since 2016: in particular, the economic restructuring that is forcing many Rhode Islanders to work for wages that are insufficient to make ends meet and the rapid pace
of technological innovation (e.g., automation, artificial intelligence), which already threatens the future of work in particular industries. At the same time, there are new opportunities to be seized, starting with the dramatic demographic transition that has put the state on
the trajectory to be a majority minority state along with the rest of the country. These challenges and opportunities cut across advanced and non-advanced sectors and companies, requiring either new or revised policy responses.
Rhode Islanders finally advised us not to ignore traditional, mostly self-inflicted, challenges—the low quality of schools (in certain communities) and infrastructure (more broadly), an inadequate supply of quality and affordable housing options, the fragmentation of municipalities, the sense of opacity and cost of doing business—which have taken on new importance and urgency in the state. They also recommended that we connect the dots between economic prosperity and disparate parts of the state’s agenda (e.g., climate resiliency, reducing health disparities, and increasing quality of place) which are inextricably linked. Economic development is not an act that can occur in isolation, even when specific supports for businesses, workers, and places are well designed and delivered.
In the end, Rhode Island is a small state in a highly competitive region, nation, and world. Its size could be a strength in a fast-moving and rapidly changing world, allowing the state and its sectors, large companies, small businesses, and anchor institutions to move into closer alignment faster than would be possible for larger communities. But being small requires the state to be agile and nimble to leverage distinctive strengths and connect related assets (e.g., the procurement needs of large employers and the demand needs of small businesses) in deeper and more sustained ways. It also requires the state to focus and target its allocation
of scarce resources.
In summary, the state has shown its ability to design, finance, and deliver a series of meaningful projects that support businesses, workers, and communities. It now needs to move from individual transactions to structural transformation and to grow the distinctive
assets and capacities of this special place into a productive, sustainable, and inclusive economy. That will require a shared vision among multiple stakeholders and a collaborative, cross-sector approach to shaping and stewarding the economy.
Photo: A n v e s h/Unsplash