Staying on top

A year after taking office as director of the Ohio Department of Development, C. Lee Johnson is watching the state in what he calls “the longest boom since the one right after the second World War.”

He attributes the state’s strong economy to its manufacturing industry, which employs 18 percent of Ohio’s work force and accounts for about 20 percent of the state’s gross economy, as well as to its technology segment, which he says is stronger than most people believe.

Obviously, Johnson’s not worried about the state today. He is concerned, however, about tomorrow.

“Having come from 40 years in business, I feel getting to the top is really not the issue,” Johnson says. “It’s how do you stay on top, and that’s where we are.”

The biggest challenge the state faces, he says, is work force development. Studies show Ohio’s population will remain relatively flat over the next decade, he says, and the 65-and-older age group will grow the fastest.

The real issue of work force development is not so much the number of jobs, he says; it is the quality of jobs available.

“Are we going to have jobs to not only help the citizens of the state improve their standard of living but also their quality of life?” he asks, adding the state must work to improve education and skill levels to allow job seekers to fill quality positions.

Another challenge: creating an environment conducive to the fastest growing business sectors in the state — service level jobs and small businesses.

Several initiatives, Johnson says, already have begun to address these issues.

Emphasizing the Ohio Industrial Training Program.

The state needs to work on the interface between educational systems and businesses that need skilled workers, Johnson says.

“Education needs to know what kinds of skills are being demanded” by businesses, he says.

The Ohio Industrial Training Program assists manufacturing and manufacturing-related industries by providing grants of up to 50 percent of training costs to companies. Training is generally provided by state vocational schools, technical colleges or universities.

In 1999, the program assisted 192 companies with more than $14 million in grants expected to create more than 7,800 jobs and retain 16,177 by offsetting the cost of training 35,247 employees. In 1998, the program awarded $9.9 million in grants to 148 businesses.

Improving conditions for small businesses.

Moves have been made to reduce the amount of paperwork and red tape for small business, Johnson says, and Gov. Bob Taft has made moves toward addressing small business issues by creating the Small Business Advisory Council. In addition, efforts must be made to have more seed capital funds available, Johnson notes.

“A few seed capital firms are beginning to develop in several regions around the state, but we don’t have near enough and we don’t market it well so small businesses know where to go,” he says.

Broadening the focus of work force development efforts.

The state, he says, tends to concentrate efforts in areas normally considered heavily populated because that’s where there are more businesses and a requirement for skills.

“Due to the fact there is not an increase in population and the older population is growing, every single citizen of this state is going to be important in keeping the economy of this state growing as fast as the economy of the United States is going to grow,” Johnson says.

That means the state needs to increase the skill and education levels of people in Appalachian and urban areas of the state, Johnson says. It can help do that by sending more development department employees to those areas.

“This will not only help the economy, but help a sector of society in this state who has needed it for a long time,” he says.

Johnson also heads the newly created Urban Revitalization Task Force, which is developing an agenda for rebuilding Ohio’s urban areas.

Taft echoed those concerns in his State of the State address in January, pledging to create an Office of Urban Development; call on Congress and the Appalachian Regional Commission to target more resources to distressed counties; and double current state funding for economic development in Appalachia.

To determine general needs around the state, Johnson has made a point of keeping in touch with development directors in its various regions. During his first six months in office, Johnson visited each of the state’s 12 economic development regions.

Columbus, for example, has a very strong economy and it’s one of the few areas in the state where both the city and the county have a AAA bond rating, which affords borrowers lower interest rates on debt and increases investor confidence.

“Columbus has built a foundation for their economy that is like a rocket ready to take off,” Johnson says, citing new development downtown and in the Easton area.

The Cleveland and Akron areas, he says, have a strong bond because of their work together on cooperation between universities and businesses.

“They have, I think, because of the number of universities — Case Western, Kent, the University of Akron — and locations like Cleveland Clinic, an opportunity for technological advancement probably better than any other in the state that I’ve seen,” he says.

In the southern region of Ohio, Cincinnati has made “lemonade out of lemons” by working with competing regions such as Kentucky and Indiana.

“Today there are no natural boundaries from my point of view in the economy,” Johnson says. “Their effort is clearly to help their businesses become more competitive.

“They’re thinking, not just about particular businesses themselves, but suppliers, supplier groups, and determining what it is they need.”

How to reach: Ohio Department of Development, (800) 848-1300, or www.odod.state.oh.us — choose “Resource Ohio” or “Fact Book” for business incentive and assistance programs.

Joan Slattery Wall ([email protected]om) is an associate editor and statehouse correspondent for SBN.