2014 10-14 portland conference - portland, or

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On October 14, Amy Liu presented at the Annual Economic Summit hosted by Greater Portland Inc. As Portland launches a new Blueprint for Regional Economic Growth, Amy Liu unveiled how metros can adopt a new model of economic development that helps build globally competitive and inclusive regional economies.

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  • 1. CHARTING A NEW PATH TO GROWTH AND PROSPERITY Implications for a Blueprint for the Regional Economy Metropolitan Policy Program at BROOKINGS @BrookingsMetro @Amy_Liuw Portland, OR October 14, 2014 1
  • 2. On the Surface, the Economy Has Recovered from the Great Recession 5,000,000 0 -5,000,000 -10,000,000 +865,000 jobs 2007 2009 2014 Metropolitan Policy Program at BROOKINGS Post-Recession U.S. Jobs Gap Since start of recession Source: Current Employment Statistics. 2
  • 3. However, We Still Face a Growth Problem 5,000,000 0 -5,000,000 -10,000,000 Post-Recession U.S. Jobs Gap Since start of recession 2007 2009 2014 Metropolitan Policy Program at BROOKINGS 5.6 million missing jobs Payroll Count Jobs Gap Growth-Based Jobs Gap Source: The Hamilton Project analysis of Congressional Budget Office and Current Employment Statistics data. 3
  • 4. 40% 30% 20% 10% 0% -5% 1990 2000 2012 Metropolitan Policy Program at BROOKINGS 36% 0% -4% We Also Face a Wealth Problem Change in Output Per Capita and Median Household Income Since 1990 Output Per Capita Median Household Income Output per capita: +$14,589 Median income: -$2,120 Source: Current Population Statistics, BLS Consumer Price Index, Census Population Estimates, Moodys Analytics. 4
  • 5. Finally, We Face an Inclusion Problem Income Growth During Recovery 2009-2012 Metropolitan Policy Program at BROOKINGS Unemployment Rate by Age Recession through 2013 2007 2012 Source: Current Population Statistics. 23% 16% 2007 2012 16 to 19 years old 6% 4% 0.4% 31.4% Top 1 Percent Bottom 99 Percent Source: Saez and Piketty, The Evolution of Top Incomes in the United States, 2013. 13% 8% 2007 2012 20 to 24 years old 25 and Older 5
  • 6. 1 2 1 2 3 The U.S. needs a new model of economic growth Regions will be key to delivering inclusive growth and opportunity Regional leaders must embrace new habits of economic development to improve prosperity 3 Metropolitan Policy Program at BROOKINGS 6
  • 7. 1 2 3 The U.S. needs a new 1 model of economic growth Metropolitan Policy Program at BROOKINGS 7
  • 8. Pre-Recession Economy DEBTSPECULATION CONSUMPTION DEBT DEBT CONSUMPTION CONSUMPTIONSPECULATION DEBT DEBT DEBT Metropolitan Policy Program at BROOKINGS Next Economy INFRASTRUCTURE HUMAN CAPITAL MANUFACTURING INNOVATIONSTEM ADVANCED ENERGY EXPORTS R&D OPPORTUNITY We Need New Growth Strategies 8
  • 9. At the Same Time, We Need to Adapt to Macro Forces Globalization Technology Demography Metropolitan Policy Program at BROOKINGS 9
  • 10. Global Competition Is Fierce, with Growth Shifting Away from the United States Share of Global Economic Growth Metropolitan Policy Program at BROOKINGS Middle Class Consumption 5.9% North America 53.2% China & India 2050 US Canada Mexico Source: Homi Kharas, The Emerging Middle Class in Developing Countries, OECD, 2010. 20.2% US 2013 2019 30.1% BIC Countries Source: International Monetary Fund, World Economic Outlook Database, October 2014. 10
  • 11. Technological Advances Are Rapidly Disrupting Labor Markets $33 trillion Metropolitan Policy Program at BROOKINGS /YEAR McKinsey & Company: maximum estimated global economic impact of 12 technology platforms through 2025 Source: James Manyika and others, Disruptive Technologies, McKinsey & Co., 2013 Share of U.S. Jobs at Risk of Automation 47% 2013 2033 Source: Carl Benedikt Frey and Michael A. Osborne, The Future of Employment, 2013. 11
  • 12. The United States Is in the Midst of a Huge Demographic Shift 24.5% Metropolitan Policy Program at BROOKINGS 53.7% minority population share of U.S. workforce by 2038 Source: Brookings/William Frey analysis of U.S. Census 2010 data. todays U.S. workforce that will reach retirement age by 2030 12
  • 13. Rapid Diversification Currently Comes with Wide Educational Achievement Gaps Metropolitan Policy Program at BROOKINGS Bachelors Degree Attainment 2012 50.5% Source: Brookings analysis of American Community Survey data. 29.1% Total Asian 32.5% 18.7% 13.8% White Black Hispanic 13
  • 14. Trade Innovation Talent Leaders will invest in the drivers of growth and prosperity. Metropolitan Policy Program at BROOKINGS 14
  • 15. Trade Supports Jobs in Non-Traded Sectors Metropolitan Policy Program at BROOKINGS Traded-Sector Job = Local-Serving Jobs Source: Ezell, Stephen and Robert Atkinson, 2012, Fifty Ways to Leave Your Competitiveness Woes Behind, ITIF. 15
  • 16. Global Trade Creates Jobs, Generates Income, and Supports High Wages Metropolitan Policy Program at BROOKINGS International Exports Economic Impact 29.9% 8.1% Share of GDP Growth 09-13 Share of Job Growth 09-13 17.0% Manuf. Trade Wage Premium 20.0% Services Trade Wage Premium Sources: Moodys Analytics; Brookings Export Nation; J. Bradford Jensen, Global Trade in Services, Petersen Institute for International Economics, 2011; David Riker, Do Jobs in Export Industries Still Pay More? ITA, 2010. 16
  • 17. Global Trade Creates Jobs, Generates Income, and Supports High Wages Metropolitan Policy Program at BROOKINGS International Exports Economic Impact Portland 32.0% Export Growth 09 12 14.9% Export Job Growth 09 12 14.1% 25.9% Export Growth 09 12 Exports Job Growth 09 12 Sources: Moodys Analytics; Brookings Export Nation; J. Bradford Jensen, Global Trade in Services, Petersen Institute for International Economics, 2011; David Riker, Do Jobs in Export Industries Still Pay More? ITA, 2010. 17
  • 18. Global Trade Creates Jobs, Generates Income, and Supports High Wages Metropolitan Policy Program at BROOKINGS International Exports Economic Impact 4.4% 13.2% Portland 24.4% 8.6% Share of Output Share of Jobs Share of Output Share of Jobs Sources: Moodys Analytics; Brookings Export Nation; J. Bradford Jensen, Global Trade in Services, Petersen Institute for International Economics, 2011; David Riker, Do Jobs in Export Industries Still Pay More? ITA, 2010. 18
  • 19. Innovative Industries Drive Value Creation and Productivity Growth Metropolitan Policy Program at BROOKINGS 60.0% Advanced Industries Share of U.S. Totals 37.9% 30.3% GDP Patents Share of GDP Growth 09 13 14.5% Share Job Growth 09 13 81.3% R&D 8.8% Jobs 17.8% Engineers *Advanced Industries spend over $450 on R&D per job annually and over 20 percent of jobs are in STEM occupations. Source: Brookings Institution forthcoming. 19
  • 20. Innovative Industries Drive Value Creation and Productivity Growth Metropolitan Policy Program at BROOKINGS Advanced Industries Share of U.S. Totals Engineers Patents R&D *Advanced Industries spend over $450 on R&D per job annually and over 20 percent of jobs are in STEM occupations. Source: Brookings Institution forthcoming. 10.9% 39.5% 74.9% 19.3% 81.3% 60.0% 30.3% Jobs Share GDP Job Growth 09 13 Share of GDP Growth 09 13 Portland 20