Connect Savannah
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www.connectsavannah.com
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Cover Story
NEWS|
by Jim Morekis
IT’S BECOME SOMETHING of a local cliche: Energized outsider falls in love with Savannah and moves to town armed with new ideas -- only to slink off in humiliation, defeated by Savannah’s legendary apathy and by the insularity and short-sightedness of the local old-boy network. Chris Miller, founder and director of The Creative Coast Initiative, seems to be cut of a different cloth, however. Though a more energized outsider with newer ideas you’ll never find, he’s been able to secure for Creative Coast the confident backing of the local business community, working as an integral arm of the Savannah Economic Development Authority. How has Miller succeeded where so many have failed? His bright, engaging personality doesn’t seem to have hurt. Nor has his warp-factor speed in grasping abstract economic concepts, both micro and macro. And to be completely blunt, it also can’t have hurt his case that as vice president of the Mindspring/Earthlink internet giant in the ‘90s, Miller was involved with enough cold hard cash to bring tears of joy to the crusty eyes of the most ossified of Savannah’s old money bluebloods. But to hear Miller himself explain things, it still all boils down to -- you guessed it -- falling in love with Savannah. “I was born in Virginia, grew up in Delaware and Rhode Island, worked in Africa for many years. I’ve been all over,” he says. “I’ve been around the block and I know what a good place looks like.” Miller’s goal with the two-year-old Creative Coast Initiative is to invigorate the economy of the local MSA (Metropolitan Statistical Area, ours comprising Chatham, Bryan and Effingham counties) by promoting “knowledge-based businesses” such as design firms, software publishers, ISPs, advertising, architecture and yes, your friends in the media. These knowledge-based businesses help Savannah in two ways: One, they can dramatically lift area wage levels; and two, they tend to bolster quality-of-life aspects like arts, culture and the environment. For Miller, The Creative Coast concept is summed up in a single word: Innovation. “Innovation is the intersection of art and technology,” he explains. “Thinking creatively to apply technology to solve problems.” We spoke to Miller last week in our office and again at the Creative Coast digs within the SEDA building off Chatham Parkway. There, Miller works with the rest of the young and hard-working Creative Coast staff: project manager Fitz Haile, project assistant Danielle ValcourtSmith, and designer Stefanie Danhope-Smith.
Connect Savannah: You’ve compiled some really interesting numbers from your latest research. Chris Miller: Well, we’ve graphed the average real weekly wage in the Savannah MSA, which is the simplest number you can get. You can see the vast majority of our jobs are down here, below $400 a week (graph, page 8). Then you move here, to about $1300 a week, and you get a little bump. But then you see it just flatlines from there. When people look at the number of jobs in Savannah, they start doing their happy dance saying, “we’ve created so many new jobs” -- but that’s just because everyone wants to count noses. No one wants to count dollars. But with the decline of the manufacturing sector here, what’s actually happening is we’ve replaced $1000 a
buildings and 6.5 million tourists a year, and we’re not even tracking the state with wage growth. If all we aspire to be is Macon, we’ve got serious problems. If we aspire to be Charleston, I guess we could lord it over them and say, well, our average wage started higher than Charleston’s. But look at their rate of increase -- it’s incredible. It’s not just the real increase, but the rate of increase. If Charleston’s wage growth keeps going at current projections they’re going to blow by us.
Connect Savannah: From which sources do you derive your raw data?
Chris Miller is seated; the rest of the Creative Coast Initiative, from left to right, comprises Danielle Valcourt-Smith, Stefanie Danhope Smith, and Fitz Haile week jobs with $250 a week jobs. That decreases our tax base by 50 percent. Then we gathered data on real wage growth, and compared the Savannah MSA with regional MSAs against the national average wage since 1990. You really have to compare MSA to MSA rather than city to city, because the MSA is the real economic entity. Looking at the state of Georgia’s wage growth, you say, hey, the state’s kicking butt (graph, page 7). Not only have wages grown by over four percent, but the average wage in Georgia is now a little higher than the national average. Then you look down here and you see the Macon MSA with a negative 5.3 percent wage growth. And -- uh-oh -- there’s the Savannah MSA, below Macon. So with all this talk about a Savannah renaissance, we’re actually racing Macon to the bottom in real average wages. We’ve got this massive port, all these pretty
Chris Miller: We get most of it from the federal and state Departments of Labor. They collect exact wage and tax information from every business in operation. We assume that’s the best data available, except for where someone’s willing to go to jail for giving false numbers. No one else counts. All the other numbers are hocus pocus. When we started looking for this data we discovered that most of the numbers out there are totally bogus. People use multipliers to make their case, and they go out to a firm and buy whatever multiplier they need to make that case. You ask how they come up with those multipliers, and oh, they can’t tell you that, that’s their secret sauce. So a year and a half ago we threw all numbers out the window. We found a method by which we could create a definite list of what is and what is not a knowledge-based business simply by using two different data sets from the feds. One table says we know in law firms, for example, that there are x number of lawyers, y janitors, z secretaries and b number of IT folks. The U.S. government has classified every business into a NAICS code -- short for North America Industry Classification System. We know that for every NAICS code, in every business in that NAICS code there’s a certain number of employees. Another index tells them what percent of what types of occupation are knowledge-based -- for example, we know software engineers are 90 percent knowledgebased. We can then lay one template on top of another for every NAICS code. Certain occupations are knowledge-heavy -- software engineer is, janitor isn’t -- so we can extract how many people in a NAICS code are knowledge workers Then we said, “Show us every NAICS code where 75 percent of the employees are knowledge-based.” Out pops a pattern -- boom -- here are the NAICS codes of businesses that are primarily knowledge-based. What Fitz Haile did here, and what we just won an award for in Chicago, is to create this new method of finding the gold nuggets that everybody in the world is panning for. That’s our secret sauce. But hey, it’s open source secret sauce.
Connect Savannah: What conclusions did you draw? Chris Miller: From this data we know down to the penny and the single worker where the knowledge-based workers are. And we found out that knowledge-based businesses locally derive the same total wages as all the lower-wage, non-manufacturing businesses combined. You don’t always see knowledge-based workers because they may not work for major corporations. They may telecommute. For example, you won’t see the editor of The Economist that works at the Landings. People like that are all part of knowledge-based businesses, but they don’t work in a glass skyscraper you can point to. The vast majority of knowledge-based businesses are
