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June 2012
Collaborative Success: Charlotte a Model for U.S. Competiveness
By John Paul Galles

     Though we’ve lasted through the Great Recession that began in December 2007 and bottomed out in June 2009, we are still reeling from the loss of income, investments, home values and jobs. The substantial structural changes underway will continue to diminish wealth and threaten our livelihoods for years to come.

     The global economy has attracted many industries away from the United States to foreign soil, and different governments and institutions are also attracting U.S. wealth and assets.

     And so, we struggle to understand these changes and how they will affect our future. Is the U.S. in decline? Have we lost our competitive position? Can the U.S. really compete globally? If so, how?

     To address these questions, the Harvard Business School launched a study of U.S. competitiveness with a survey of nearly 10,000 Harvard alumni in October 2011. In March 2012, they presented a report in the Harvard Business Review that provides an analysis of the critical areas that drive U.S. competiveness.

     The survey demonstrated strong evidence that the United States faces a deepening competiveness problem. Seventy-one percent of respondents expect the U.S. position to decline over the next three years with worker living standards under greater pressure than firms’ success. Pessimism was widely shared.

     More than 1,700 respondents were personally involved in decisions about whether to place business activities and jobs in the U.S. or elsewhere. Given those choices, the U.S. fared poorly, losing two-thirds of those decisions. Facilities involving large numbers of jobs moved out faster than they moved in.

     The survey also helped to pinpoint the problems that affect the U.S. Those problems include America’s tax code, political system, K-12 education system, macroeconomic policies, legal framework, regulations, infrastructure and workforce skills. While there is little progress on the federal level, many initiatives are coming at the local level.

     Harvard’s definition of U.S. competitiveness is “the extent to which firms operating in the U.S. are able to compete successfully in the global economy while supporting high and rising living standards for Americans.” Both firms’ success and worker living standards are essential to this measurement. The U. S. can win globally and support high wages by being highly productive over the longer term. They conclude that business leaders and policymakers in America “must find ways for Americans to work smarter and more productively than workers who are paid lower wages overseas.”

     In early May, 2012, Harvard Business School held a seminar in Charlotte to discuss local efforts and shed light on local initiatives. In particular, they were interested in Charlotte’s Energy Cluster and its ambitions to create new job opportunities and provide the innovative training programs to equip workers with the required skills for 21st century jobs. The school has chosen to feature Charlotte as a role model of dynamic local leadership in its competitiveness project.

     At the seminar, Duke Energy CEO Jim Rogers spoke about inviting area energy-related enterprises to a meeting with what turned out to be standing room only. Currently, more than 200 energy businesses are benefiting from its emerging energy cluster; cross collaboration has been credited with having added over 5,000 jobs in the last five years. Together with Central Piedmont Community College and UNC Charlotte’s EPIC center, they are developing curricula, apprenticeships and research in support of Charlotte’s energy economy.

     Adding to these local initiatives, the Charlotte airport and its new Intermodal Center will provide even more resources to stimulate job growth and business success.

     While Charlotte has been hugely successful at recruiting new companies to our marketplace, at this point our nucleus of businesses and business resources can foster even greater growth from within our region than we can by attracting out-of-town entities. Growing our marketplace from within will overwhelm any pessimism and replace it with a renewed vitality and confidence in our ability to compete globally.

     If you have an idea or a story of collaborative success you’d like to share, we’d like to hear about it. We have work to do. Let’s get on with it!

John Paul Galles is the publisher of Greater Charlotte Biz.
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