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Macomb County, Michigan Targeted Industries Study

Macomb County, Michigan Targeted Industries Study. August 2006 – Presentation to Focus Macomb . Targeted Industries Study. Part 1 Targeted Industry Focus Part 2 Branding and Marketing Macomb . “98% want to attract new business, but 70% have no written business attraction plan”.

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Macomb County, Michigan Targeted Industries Study

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  1. Macomb County, MichiganTargeted Industries Study August 2006 – Presentation to Focus Macomb

  2. Targeted Industries Study • Part 1 Targeted Industry Focus • Part 2 Branding and Marketing Macomb

  3. “98% want to attract new business, but 70% have no written business attraction plan” International City/County Management Association, Economic Development Survey 2004

  4. Study Objectives …for targeted growth. Mapping Macomb’s assets… • Business Retention & Expansion • Organic Growth • Leap Growth • What does Macomb have to offer? • What strengths can be leveraged? … to economic opportunity • What industries or business sectors would Macomb be most closely aligned with? • Primary & secondary targets

  5. …for targeted growth. “An economic entity that exists on its own, but draws strength from regional partnership and collaboration” (Personal interview/Internal Macomb, 03/06) • Business Retention & Expansion • Organic Growth • Leap Growth: *Advanced manufacturing *Alternative Energy *Bio-chemistry *Homeland Security/Defense *Medical/Healthcare

  6. Mapping Macomb’s Assets Targeted Industries Study

  7. % Distribution of Employment in Macomb County vs. other regions Source: U.S. Census Bureau, U.S. County Business Patterns, 2003

  8. Manufacturing Retail Trade Professional & Business Srvs., Mgmt. Scientific & Technical Consulting Finance, Insurance, Real Estate Construction Healthcare & Social Assistance Wholesale Transportation & Warehousing Information Agriculture Mapping Current Employment Leverage As % of Total Macomb Employment Develop Low U.S. Projected Growth for Industry

  9. Manufacturing Healthcare & Social Assistance Mapping Macomb Current Employment Enhance/Expand Leverage Retail Trade As % of Total Macomb Employment Develop Low Finance, Insurance, Real Estate Professional & Business Srvs., Mgmt. Scientific & Technical Consulting Construction Wholesale Information Transportation & Warehousing Agriculture U.S. Projected Growth for Industry

  10. Internal Perspectives • A survey of Macomb County business (Mar. 2006) identified key “drivers” in their decision to choose Macomb: • Geographic proximity • Proximity to markets and customers • Availability/cost of land/buildings • Skilled workforce (only mentioned by manufacturing segment) • Perceived “good business environment”: 63% of businesses surveyed rated Macomb “very good” to “excellent” as a place to do business. • Optimistic growth outlook: 60% of manufacturing companies anticipate needing “manufacturing skilled trade” and 50% anticipate needing engineering skills for continued growth.

  11. How would you rate Macomb as a place to do business? Source:Intellitrends LLC, Macomb County Business Insight Study, 03/06

  12. How would you rate Macomb as a place to do business? Highest rated: Geographic location Quality of life Lifestyle infrastructure Proximity to markets Proximity to suppliers Lowest relative rated: Grants, funding Tax incentives Taxes Cost of land Cost of labor Source:Intellitrends LLC, Macomb County Business Insight Study, 03/06

  13. Industry Situation: Manufacturing – Going Global • Quality products & services • Competitive pricing/cost • Engineering capabilities • Competitive pricing/cost • Cost of labor • Skilled workers Markets 60% serve national/global markets Source:Intellitrends LLC, Macomb County Business Insight Study, 03/06

  14. Optimistic Employment Outlook Over the NEXT 3 YEARS, how do you anticipate your Macomb employee base will change? Source:Intellitrends LLC, Macomb County Business Insight Study, 03/06

  15. What are the primary skill areas you anticipate needing for continued growth? How would you assess the current availability of those skills in Macomb’s employee base? Total Manu. Strong 36% 30% Moderate 25% 30% Limited 20% 10% Scarce/Not at all/DK 19% 30% Source:Intellitrends LLC, Macomb County Business Insight Study, 03/06

  16. Targeted Industries Study External Dynamics

  17. Key Drivers for Business Relocation/Development • U.S. CEO’s surveyed in March 2006 identified the 7 most important issues in choosing where to do business: • Workforce quality • Labor costs (including wages, Healthcare, Workers Comp.) • Taxes • Regulation • Infrastructure • Quality of Life • Political Environment Source: CEO Magazine, March 2006

  18. Geographic Migration of Projects in U.S. #1 State in the Region for Growth based on % of total projects #1 Massachusetts #1 Pennsylvania #1 Ohio #1 Minnesota #1 North Carolina #1 Alabama #1 Tennessee #1 Texas #1 Arizona #1 Washington

  19. Geographic Migration of Projects in U.S. Source: Conway Data Inc.’s New Plant Database/Site Selection On-line, March 2006 *Other facilities includes offices, headquarters, distribution centers, R&D, mixed use facilities & hotels

  20. Manufacturing Drivers • NAM Survey (March 2006) • One in two manufacturers plans to increase employment in 2006 • 47% will hire skilled workers for production jobs • In terms of site selection, manufacturing companies globally are also paying more attention to: • Proximity to institutions of higher learning • Customized training programs • Availability of incentives • Keeping workers up to speed with the latest technologies

  21. Mapping Macomb Attributes • 1.) Skilled Workforce/Resources, 2.) Infrastructure; 3.) Business Environment and 4.) Government Support Focus Opportunities Development Initiatives Branding Initiatives Differentiator Cost of labor Specific manufacturing skills Skilled manufacturing talent Grants, funding, tax incentives Partnerships with education Regional Resources Low taxes Ability to attract scientists & engineers/research universities County economic health Geographic proximity to customers, markets, suppliers Media Attention Strong Automotive Image Recognized business & industry champion Training to meet needs Availability of land/bldgs Technology transfer Utilities cost & capacity Gov’t willing to collaborate/work with business Avg. educational Levels Coordination with regional partner/collaboration Ability to attract & retain youthful population Strong work ethic Dedicated funding for economic development Significant Customer Segments (TACOM, Defense) Importance to Site Selection Population gain Zoning Vision Quality of life (housing, low cost of living, low crime) Presence of small support businesses Evaluation of new markets, opportunities Progressive culture – outlook/understanding Local competition Strong support for start-ups/small business Pursuit of funding for training, growth Parity Longevity of residents Racial/religious diversity Eliminating hurdles Targeted Marketing Perceived Weakness Macomb Attribute Perceived Strength

  22. Targeted Industries Study Vision & Synergies in Growth

  23. Projected Growth & Emerging Sectors

  24. Regional Resources in Macomb Macomb employment in each sector as a % of 8 county region sector employment • Macomb is • 14% of total employment in the 8 county region • 16% of total employment in the 8 county region Technology Cluster Source: 2003 County Business Patterns, U.S. Census Bureau/Anderson Economic Group, Automation Alley’s First Annual Technology Industry Report, 2005

  25. Collaborating and Differentiating within the Region Collaborate Regionally Supporting Areas Advanced Automotive Advanced Manufacturing Life Sciences/ Biotechnology Chemicals & Materials Homeland Security Information Technology Alternative Energy Defense Presence in 8 county Region (employment contribution to cluster) Geographic Niche Clusters Primary Differentiation for Macomb Presence in Macomb County (employment contribution to cluster)

  26. Advanced Manufacturing Macomb % contribution to the 8 County Region Technology Cluster : 23% • 2003 survey of U.S. manufacturing employers found that 80% of respondents said that they had a serious problem finding qualified candidates for the highly technical world of modern manufacturing (National Association of Manufacturing) Sources: www.doleta.gov/BRG

  27. Advanced Manufacturing Advanced manufacturing technologies (AMTs) involve new manufacturing techniques and machines combined with the application of information technology, micro electronics and new organizational practices within the manufacturing sector. • Flexible manufacturing cells or systems • Robotics • High-speed machining • Supervisory control and data acquisition (SCADA) • Automated sensor-based inspection/testing systems • Automated vision systems • Lasers used in material processing • Distributed control systems • Rapid prototyping systems • Computer-aided design/engineering software (CAD/CAE) • Programmable logic controllers (PLCs) • Use of inspection data in manufacturing control • MRP or Enterprise Resource Planning (ERP) software • Automated parts identification (i.e. bar coding) • Modeling or simulation techniques

  28. Advanced Manufacturing Employment 2003 Advanced Manufacturing employment in Macomb - % distribution within sector (compared to Michigan) 40% of employment in this cluster is “machinery manufacturing” Source: 2003 County Business Patterns, U.S. Census Bureau/Anderson Economic Group, Automation Alley’s First Annual Technology Industry Report, 2005

  29. Machinery & Equipment Industry Business Location Drivers • Rising shipping costs, particularly for sectors that must transport massive machines, will see many firms investing in plants closer to the customer • Finding the right work force will play an equally important role • Factories now need highly trained workers – decisions could hinge on a state of locality’s commitment to work force training • New York State and St. Louis region are two areas that have made a significant commitment to the type of technical workforce training initiatives that machining and equipment manufacturing firms will need n the 21st center Sources:www.siteselection.com, On the Rebound, March 2005

  30. Advanced Automotive Advanced Automotive has been identified as the new sector, defining an industry not by what is made but how it is made. This new advanced automotive sector is defined by hundreds of advanced technology initiatives in energy, safety and materials that improve vehicle quality, safety and extend longevity. • Pinpointed as one of the President’s High Growth Employment Industries • Employment is expected to grow more rapidly in firms that manufacture motor vehicle parts, bodies and trailers than in firms that make complete vehicles • Creates 6.6 million direct and spin-off jobs. For every worker directly employed by an automaker, nearly 7 spin-off jobs are created Macomb % contribution to the 8 County Region Technology Cluster : 19%

  31. Advanced Automotive • Body & Exterior • Lightweight materials, Unit body construction • Paint/Coatings/Adhesives • Lighting • Power train • Enhanced fuel economy: Fuel cell, Hybrid electric, Hydrogen fueled • Advanced batteries, Emissions control • Ride & handling • Brake & Gas • Low rolling resistance tires • Safety systems • Sensing systems • Safety features • Interiors • Seating • HVAC • Navigation

  32. Advanced Technologies Market Penetration 2004 - 2030 • Market penetration of advanced technologies: • Lightweight materials Improved pumps • Improved aerodynamics Low rolling resistance tires • Engine friction reduction • Unit body construction

  33. Homeland Security Homeland Security: Michigan • Majority of homeland security is performed in the private sector, with 85% of all critical infrastructures privately controlled; 35% of all U.S. companies plan to invest in and expand security programs (ASIS International Foundation Trends Report, 2005) • Approximately $33 billion of federal funding in FY 2005 with heavy emphasis on developing new technology to assist the four main parts of effective preparedness: • Prevention: Biometrics, vaccines, intelligent systems, cargo screening systems • Detection: Bio and radiation sensors, training • Reaction: EMS equipment, communications, computer modeling • Recovery: Bioremediation, decontamination Source: www.michigan.org/medc/ttc/HomelandSecurity/

  34. Defense • Michigan companies already play a lead role in development and production of equipment and expertise: improved body armor producers, concrete strengthening systems, portable tracking and communications systems and advanced detection systems • Strong R&D and manufacturing capabilities make Michigan a natural leader in emerging areas • Technology • Information analysis and infrastructure protection • Emergency preparedness and response • Threat assessment tools and strategies

  35. Defense Defense Industry: TACOM Number of Contracts Awarded by State Contract Types Awarded to Michigan Companies from 09/04 - 03/06 Source:TACOM LCMC Advanced Planning Briefing to Industry – Tacom2005.ppt - 26-28 Oct 05

  36. Defense Defense Industry: TACOM Percentage of Total Dollars by Contract Type Awarded to Michigan Companies from 09/04 - 03/06 Source:TACOM LCMC Advanced Planning Briefing to Industry – Tacom2005.ppt - 26-28 Oct 05

  37. Targeted Industries Study Macomb County Opportunities What’s next?

  38. Industry Expansion and Targeting Advanced Automotive Advanced Manufacturing Homeland Security Information Technology Alternative Energy Defense Strong Industry Potential High Support Industries to Develop Strong Industry Differentiation

  39. Targeted Industries Study Trends in Economic Development Strategy

  40. Economic Development Survey 2004 & 2005 • Focus of economic development activities: • Business attraction/recruitment = 44% • Business retention = 41% • Top business retention activities: • Partnering with other non-governmental organizations = 81% • Local government representative calls on local company = 78% • Top promotional activities used to attract business: • Website = 86% • Working with Chamber of Commerce = 84% • Offer high quality of life = 74% • Promotional and advertising activities = 63% • Average local budgets for economic development in 2004 = $753,161 Source: ICMA. Economic Development 2004

  41. Common Characteristics of Winning Organizations in attracting business • Every winning agency used a state of the art Web-site • On-line databases of available buildings and sites • Work-force training initiatives moved to the top of the “to do list” • The ability to quantify and deliver a trained work force in specialized skill-set categories • “Partnerships”: The ability to bring together diverse groups under one effort to market and promote a geographical area “won more projects than stand-alone cities and counties” Without the region as a whole, we wouldn’t be where we are today. Creating new jobs and investing capital investment in our community takes a cooperative effort on behalf of local governments, businesses and citizens.” Melanie O’Connell Underwood Executive Director/Mooresville, NC Chamber (2005 = $302m/1,125 jobs)

  42. Top U.S. Economic Growth Areas 2005 Source: Site Selection On-line, March 2006

  43. Industry Retention & Expansion, Growth & Targeting Macomb County’s Opportunities

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