by Martin Bergeron
While the U.S. economy is still sluggish and most american cities have not recuperated all the jobs lost since 2008, New York City is booming. Indeed, not only has New York gained back all the jobs it had lost in 2008-09, but it has created just as many new ones too, adding up to a 200% job creation performance over a short period of time.
How did they do it? Mayor Michael Bloomberg talked about it in a speech he gave to the Economic Club in Washington DC last september. (video above)
Since the Mayor suggests that their approach could serve as an example for other cities, I want to highlight its main elements here, and briefly discuss each of them as they apply to Montreal.
New York’s economic development success, according to him, is mainly based on « four key ways that we’re working to align our economy with structural shifts » of the 21st century. Here they are:
1- Business environment and entrepreneurship
Sure: taxation is part of the equation to create a favourable business environment, Mayor Bloomberg says, but not the most important factor. Instead, entrepreneurship is the key factor to creating jobs and growing the economy, which is why his administration is making sure that it is as easy as possible to start a business in NYC. How?
“In New York City, we’re helping entrepreneurs get their ideas off the ground by joining with the private and nonprofit sectors to create incubators that have the capacity to launch more than 1,000 new businesses over the next three years. »
Here I’m thinking about Notman House, which is a fantastic project, or the CEIM as a more classic incubator. We need to support them…and we need a lot more of those in Montreal, in various sectors of the economy. Incubators could be launched and supported in more traditional, low-tech industries too, even as the high-tech sector will continue to expand its key role in our local economy.
New York has also created what they call Small Business Solution Centres « to help connect entrepreneurs to the capital and expertise they need to open and grow. » Info-Entrepreneurs already plays that role in Montreal, and perhaps it should expand its activities and grow in importance as we move forward over the next few years.
Finally, the City itself has made two key internal changes as it tries to help businesses establish themselves and grow in New York. First, it has created the position of Chief Business Operations Officer, « with the sole mission of making government more responsive and efficient in dealing with business customers. » It has also put in place a New Business Acceleration Team whose job it is to facilitate the approval process for restaurants and retail stores.
Since the vitality of commercial streets in Montreal (among those: ASDCM) is so important to our urban lifestyle, we ought to treat that last idea very seriously.
A sobering note to those who believe that throwing public money directly at corporations is the way to attract them here: it might work in a few cases, but the general data tells a different story. What will always remain important, however, is to have quality infrastructures that underpin everything else.
In New York City, this means investments in water lines and sewers, cruise and container terminals, airports, train stations…and public transit.
If you have been following this blog over the last few months, you already know by now that I am a HUGE fan of public transit. In Montreal, it is an absolute no-brainer: we ought to be investing in public transit as much as we can! Why? If you can read french, read this. If you don’t, I can sum it up quickly for you: it feeds our industrial base, improves our productivity by reducing congestion, saves montrealers a lot of money and stimulates land value.
Mayor Bloomberg invested heavily in a subway extension on the west side of Manhattan, and then saw billions of dollars of new private money being attracted to the area. Anybody surprised?
Which is great because, in Montreal, we also have metro lines to extend, starting with the blue one all the way to Anjou. Think about all the benefits that will accrue to the north-eastern area of Montreal when we finally build it? We cannot start it soon enough!
3- New markets for investment: zoning changes and tourism
Corporations come and go, people move…cities change! Yesterday’s manufacturing floor is today’s loft and an abandoned area might someday become a new hot spot. Think Griffintown!
Mayor Bloomberg explains that the City re-energized many areas – particularly in the four boroughs outside of Manhattan – and attracted new projects and investments simply by modernizing zoning regulations. For instance, some areas remained industrial zones even though they had been abandoned by industry for over twenty years. Changing these areas into residential and/or commercial areas attracts real estate investments and creates entirely new neighbourhoods where there were only vacant lots.
The city of New York also made a major push on tourism by opening and expanding tourism offices in 18 countries, which has resulted in an increase of 60% in the number of tourists from those countries. Overall, New York is now attracting 51 million visitors a year, up from 37 million just ten years ago.
Tourism is amazing: its purely new revenue that we would not have otherwise. Mayor Bloomberg sees it as an export strategy, and so do I.
The entertainment we provide, the restaurants…Montréal’s joie de vivre ought to be at the heart of an aggressive strategy for tourism going forward. Simply put: it’s very easy to have a good time in Montreal. We need more people from around the globe to know about it.
Here’s how Mayor Bloomberg introduces his foray into education:
“Rebuilding the American middle class cannot be done without retooling our skill set. When I was in high school, many low-skill jobs came with a ticket to the middle class. Not anymore. Today, with most blue-collar jobs, no longer do you just ‘work with your hands.’ Nearly every job requires more analytic thinking, more technological skill, and more computer literacy. »
This is why the debate about the future of our Universities is so crucial at the moment. Montreal is a major University town and it has to remain that way. Our Universities are, and will remain at the heart of our development and vitality. We simply have to find a way to provide better financing for them so they can remain cutting-edge and competitive, both in their teaching and research.
By the way, Universities are often the perfect partner to develop business incubators, which ties it up nicely to the first point of Bloomberg’s strategy. Many successful businesses in Silicon Valley were launched straight out of Stanford University, initially developed on campus. A good example of such an initiative is the Quartier de l’innovation, a partnership between McGill University and the École de Technologie Supérieure (ÉTS).
Of course, we don’t just need better students, we also need more of them…which means we need more kids to stay in school. While it has not been this way so far, I believe that school boards and schools in Montreal will have to become more involved in the development and success of our city.
Cities are where most people live now, and municipalities have to take a greater leadership role going forward, even when they depend on other levels of government for financing. Economic development has to be a high-level priority for the next administration in Montreal, and looking at New York City and Mayor Michael Bloomberg for guidance is not a bad place to start.