2013 Greenville Economic Scorecard

2013 Regional

Economic Scorecard The Greenville Chamber’s 6th Annual Income Competitiveness Report Human Capital

Innovative activity

Focus on

Prosperity

Industry Strength

Entrepreneurial Environment

Overview

O

n behalf of the region’s business leadership, we are pleased to present the 2013 Regional Economic Scorecard. This sixth annual report, coordinated by the Greenville Chamber, provides an objective measure of the region’s competitiveness. The region is making progress in several important measures, but continues to lag the competition in terms of the primary measure of economic competitiveness: Per Capita Personal Income (PCPI). The Scorecard provides a framework for the community to strategize about how to increase PCPI growth. Until this metric improves, the region’s residents – individuals, families and companies – are not as prosperous as they should be.

Jobs, business, and wealth are generated at the local level, all of which can be accelerated through the efforts of local leaders who are committed to the future of the community. The peer and aspirational regions we compare ourselves to have committed leadership. They have strategies in place to improve the metrics we examine in this report. The benchmark goals we seek to achieve continue to move. As our region is starting from a lower level on many of these metrics, we must increase our efforts to surpass the competition.

We are at a tipping point. Many positive developments have occurred in our region since the end of the recent downturn. We cannot afford to tolerate mediocre results on any of these key metrics. It is time to ensure development and execution of focused strategies across organizational, political and socioeconomic boundaries. The organizations participating in the Scorecard project exemplify that dedication to focusing on doing what matters most to increase the region’s economic competitiveness. We ask you to join this process as we all work to accelerate PCPI growth.

Focus on 1. Human Capital

2. Innovative Activity

Promote innovation across sectors

3. Entrepreneurial Environment

Create a robust ecosystem to nurture high-impact firms

4. Industry Strength

Move employees and companies up the value chain

5. Asset Base

2

Build pipelines between business and education

Leverage existing assets to multiply impact

Reading this Report

T

his Scorecard is based on data produced by various agencies of the federal government. Not all data covers the same time frames as publication schedules vary among agencies. The data was compiled and analyzed by Clemson University’s Center for Economic Development and the Greenville Chamber.

The Model for Economic Prosperity pyramid illustrates the building blocks of economic success. A competitive community has high levels of income, strong economic output, and increasing numbers of jobs. To achieve this success, a community must have strong competitive inputs as defined in this report.

Clemson Model Income growth is determined by four broad inputs: Human Capital, Innovative Activity, Entrepreneurial Environment and Industry Strength.

The Economic Scorecard model provides an objective assessment of these four indices based on statistical analysis.

What is an Index?

The Scorecard examines a variety of indicators of regional economic competitiveness. Each indicator is measured against the national average. A value of 110 in Greenville means that our region is performing 10% above the nation in that indicator. A value of 90 means that our region is performing 10% below the nation and that we have work to do in that area.

Indicator U.S. Value

X

100

=

Index Value

Outcomes of competitiveness • Income, jobs and sustainable development

Environment for development

• Industrial composition • Physical infrastructure • Social, cultural and institutional environment

Competitiveness inputs • • • •

Human Capital Innovative Activity Entrepreneurial Environment Industry Strength

3

Geography The Scorecard compares the Greenville MSA and Upstate SC both to peer and target regions. Eleven peer regions were selected by a statistical cluster analysis of 188 metros in the Southeast along 23 dimensions. The four target regions are considered “best in class” in terms of economic development and wealth creation.

Louisville

1

– Per Capita Personal Income (PCPI) Ranking

1

13

PCPI: $39,899 Pop: 709,901

8

PCPI: $37,544 Pop: 545,394

3

Raleigh

5

Charlotte

PCPI: $40,223 Pop: 1,795,472

15 11

Columbia

Charleston PCPI: $37,685 Pop: 682,121

PCPI: $35,350 Pop: 777,116

12

Birmingham PCPI: $40,816 Pop: 1,132,264

Jacksonville

PCPI: $40,455 Pop: 1,783,519

Greenville MSA, Upstate SC

US Average PCPI:

$41,560

Source: US Bureau of Economic Analysis Cherokee

Greenville

Greenville MSA

In this chart, two areas of the Upstate are highlighted: the threecounty Greenville Metropolitan Statistical Area (MSA) and the 10-county Upstate SC region. Both areas have been measured throughout this report. Anderson County was added to the Greenville MSA in 2013. Future reports will reflect that addition.

4

PCPI: $40,709 Pop: 1,360,251

4

Austin

6

PCPI: $40,631 Pop: 1,163,515

16

PCPI: $35,038 Pop: 647,401

Jackson

14 7

Greenville

Little Rock

Richmond

PCPI: $43,046 Pop: 1,269,380

Knoxville

2

PCPI: $42,129 Pop: 1,617,142

PCPI: $35,405 Pop: 730,966

PCPI: $36,958 Pop: 704,500

– Target regions

Nashville

Greensboro

PCPI: $37,763 Pop: 479,244

10

9 – Peer regions

Lexington

PCPI: $39,037 Pop: 1,294,849

Pickens

Spartanburg

Oconee

Union Anderson

Laurens

Gr ee nw Abbeville oo d

Economic Metrics 105.0

Per Capita Personal Income Relative to U.S.

102.5 100.0

US=100

97.5 95.0

Greenville County

92.5 90.0 87.5

If Upstate SC’s PCPI was on average with the nation, we would have an additional $12.13 billion in spendable income. Greenville County alone would have an additional $1.79 billion in spendable income.

Greenville MSA

85.0 82.5

Upstate SC

80.0 77.5

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

Gross Metro Product Growth, 2009-2011

Metro Employment Growth, 2010-2012

Metro Earnings Per Employee Growth, 2009-2011

The market value of goods and services produced by labor and property in a metro.

The number of persons employed in a metro.

Total earnings divided by the total employment (a measure of productivity) Greenville saw moderate growth, ranking seventh and surpassing the US. However, Greenville has the fourth lowest Average Earnings Per Employee among all of the metros compared.

Greenville saw moderate employment growth, ranking sixth and surpassing the US rate.

Greenville metro saw the fourth highest increase in gross metro product, surpassing the US as well. However, Greenville has the second lowest base from which to grow.

4.4%

2.94%

U.S. Rate

8%

12%

0%

4%

Greenville continues to rank highly, third out of all metros and 14% greater than the US average. However, the Upstate region is even stronger, at 35.7% above the US average.

100

U.S. Rate Greensboro Raleigh Greenville Charlotte Louisville Austin Charleston Knoxville Richmond Nashville Birmingham Columbia Jackson Jacksonville Little Rock

Austin Charlotte Charleston Nashville Knoxville Raleigh Greenville Richmond Louisville Greensboro Jacksonville Jackson Little Rock Birmingham Columbia 2%

Total value of exports divided by total employment

U.S. Rate

Austin Nashville Charleston Charlotte Raleigh Greenville Richmond Louisville Columbia Jacksonville Knoxville Birmingham Little Rock Jackson Greensboro 4%

Total Exports per Job, 2010

6.2%

U.S. Rate

Austin Nashville Raleigh Greenville Knoxville Charleston Louisville Charlotte Greensboro Richmond Jacksonville Jackson Birmingham Columbia Little Rock 0%

P

er Capita Personal Income (PCPI) measures overall wealth in a community. PCPI is determined by dividing the population’s total income from all sources by the number of people who reside in the region.

6%

8%

0

4%

8%

12%

0

40

80

120

160

5

Human Capital

Focus on

“Student graduation is one of the most definitive predictors of your city’s future innovation, entrepreneurship, and subsequent job and GDP growth.”

– Jim Clifton, Gallup

Index 0

20

40

60

100 U.S. Avg.

80

120

Indicators

Peer Cities

Lexington

4.3

Columbia

-2.7

102.9

Richmond

-0.2

102.5

Charleston

-4.3

101.8

Jackson, MS

1.5

99.6

Jacksonville

-1.7

98.2

Louisville

2.1

96.4

Birmingham

2.4

96.4

Greenville MSA

-2.1

Little Rock Upstate SC

-0.2 -0.9

Knoxville

0.0

Gtr. Greensboro

-0.4

6

Degree Attainment Percent of adult population (25+ years of age) with various levels of education: • High School Diploma • Associates Degree • Bachelors Degree • Graduate/Professional Degree

104.9

Knowledge Workers Percent of adult population (25–64) employed in occupations requiring specialized knowledge and creativity, such as management, finance, IT, science and engineering, healthcare, design, the arts

96.0

Target Cities

94.2

Raleigh/Durham............. 123.8 -1.1

90.5 89.7 89.7

Austin.......................... 117.4 1.6 X

-X

Indicates index point change from 2010

Charlotte...................... 104.7 0.8 Nashville........................ 97.8 -2.5 South Carolina............... 91.8 -2.1

The Trends Positive

Earnings and unemployment rates by educational attainment

• Continue to improve high school graduation metric • Continue to have a long-term advantage in associate degree production (but the lead is slipping)

Unemployment rate, 2012 Median weekly earnings

Doctoral degree

Professional degree

Master’s degree

• Continue to rank below all areas in four of five metrics

Bachelor’s degree

• Decline in all metrics except for high school graduation

Associate’s degree

Some college, no degree

High school diploma

Negative

0%

2%

4% 2.5%

6%

8%

10%

12%

14%

16% $1,624

2.1%

$1,735 3.5%

$1,300 4.5%

$1,066 6.2%

$785

7.7% $727 $652

Less than a high school diploma

8.3% 12.4%

$471 $0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

Source: U.S. Bureau of Labor Statistics, Current Population Survey Note: Data are for persons age 25 and over. Earnings are for full-time wage and salary workers.

n Target

Focus

NEXT High School Announced in Spring 2013, this state of the art, free public charter high school will engage and align with the business community to provide a project based learning culture to HI G H SC HOOL Est . 2014 help students develop skills necessary to local industry. From advanced manufacturing to information technology and life sciences, NEXT High School will provide a platform for ensuring that a pipeline of talent is ready to be successful in tomorrow’s economy.

Connect students with businesses Align curriculum with business needs Support/enhance existing vehicles for education delivery and create new vehicles when appropriate

7

Innovative Activity

Focus on

“Regions with higher concentrations of engineers tend to do better and seize the leadership of key industries.”

– Joel Kotkin, Chapman University and Legatum Institute

Index 0

20

40

60

100 U.S. Avg.

80

120

140

Indicators

Peer Cities

Lexington

8.7

Greenville MSA

9.1

Knoxville

8.3

Richmond

1.1

Upstate SC

5.9

Columbia

-6.3

Little Rock

1.6

Gtr. Greensboro

7.6

Birmingham

-3.2

Louisville

3.3

Jackson, MS Jacksonville

8

8.1 5.6

Private Sector Innovation Proxy Percent of employment in computer, science and engineering occupations

96.3

84.2

81.4

Public Sector Innovation Proxy Number of graduate students in science, engineering and health sciences per 10,000 workers

74.2

70.9

61.3 Target Cities

57.2

Austin.......................... 278.2 8.5

56.2

48.3

43.1

124.5

59.5

0.0

Charleston

Patents Issued Number of patents issued in an area per 10,000 workers

132.7

Raleigh/Durham............. 242.1 -22.6 X

-X

Indicates index point change from 2009

Nashville........................ 73.3 6.2 Charlotte........................ 68.5 3.8 South Carolina............... 57.3 1.6

329.3

The Trends Positive

Raleigh’s index value.

• Continue to do well in all three indicators

Graduate Students in Science, Engineering, and Health Sciences per 10,000 Residents (A Sub-metric of Innovative Activity)

• Continue to move above the national average in private sector innovation

Greenville MSA

• The Greenville metro had the largest increase by far in the Graduate Student metric and now stands higher than Austin

Negative • Patenting activity has slightly declined against the national average

200

182.9

20.4

2ND

Greenville’s 2010 index value

The amount Greenville’s index changed from 2009 to 2010, the largest gain among all peer and target cities

Where the Greenville MSA ranks compared to all peer cities, second only to Lexington

100

Source: National Science Foundation

n Target

Focus Leverage graduate/professional-level institutions for additional research/innovation

Developing Engineering Talent for Automotive Research 10 years after the inception of Clemson University International Center for Automotive Research (CU-ICAR) as a bold idea, the campus has garnered much international attention. To date, more than 100 M.S. and PhD students have graduated with almost 45% of those now employed in South Carolina. In addition, the Deep Orange program continues to provide students with experience in vehicle design, development, prototyping and production planning. Each year, a prototype vehicle is developed with a new market focus and technical objectives. CU-ICAR will continue to play a pivotal role in the region’s economic future by fostering the development of engineering talent.

Support adequate funding for innovative activities Advocate effective policies that support innovative activities Encourage collaboration, coordination (and non-duplication) among organizations supporting innovation

9

Entrepreneurial Environment

Focus on

“Innovation by itself has no value until it is chosen by talented entrepreneurs.”

– Jim Clifton, Gallup

Index 0

20

40

60

100 U.S. Avg.

80

120

Indicators

Peer Cities

Charleston

4.4

Jacksonville

-4.1

Jackson, MS

-0.4

97.3

1.3

96.4

Birmingham

-0.9

95.9

2.3 3.8

Louisville

-0.1

87.0

Columbia

1.2

86.5

0.4

85.9

Little Rock

-1.2

85.3

Gtr. Greensboro

2.7 0.0

Proprietors’ Income Share Percentage of income generated by self-employed business owners

87.5

Lexington

Upstate SC

Establishments The number of businesses per 1,000 employees

90.8

Greenville MSA

10

97.6

Knoxville

Richmond

Business Churn The total number of establishment births and deaths as a percentage of all firms

106.2

83.0

79.8

Business Services Share of employment in the professional and technical services (NAICS 54)

Target Cities Austin.......................... 115.6 -1.7 Raleigh/Durham............. 108.7 0.8 X

-X

Indicates index point change from 2009

Nashville...................... 111.7 0.4 Charlotte........................ 96.2 1.3 South Carolina............... 89.0 1.7

The Trends Positive • Improvements were seen in three of the four indicators.

• Strong growth in business churn and services.

Negative • Proprietors’ Income is well below the national average and saw a slight decline.

Employment in Professional, Scientific and Technical Industries

The amount Greenville’s index changed from 2009 to 2010 (the second largest gain among all peer and target cities)

{ 7.9

This sector employs almost 18,000 people in the metro and is the third largest in terms of annual payroll. Engineering services account for more than one third of this payroll.

Payroll Manufacturing - $1.66B Health Care - $1.44B Professional, Scientific and Technical Industries - $1.0B

n Target The High-Growth Small Business Access to Capital Act was signed into law by Governor Haley in June 2013. This legislation provides tax credits to those who invest in early-stage, high-growth companies, bringing South Carolina’s offerings in line with approximately 25 other states who offer similar incentives. Our state’s firms have seen an early-stage funding gap that has hindered firm growth. This law allows qualified individuals to receive a 35% tax credit for investing in qualified South Carolina start-up businesses. Research has documented that these sorts of programs are effective in attracting capital, growing jobs, and ultimately creating economic growth and revenue for the state.

Source: U.S. Census Bureau, County Business Patterns

Focus Ensure a favorable climate for business growth with an emphasis on high-impact firms Promote strategies that will provide business access to talent Support efforts to link small business and entrepreneurial firms to larger businesses and other anchor institutions Increase collaboration, coordination, and non-duplication among organizations supporting these firms Cultivate an entrepreneurial spirit throughout the region

11

“Countries that stimulate investment in innovation and intellectual capital, such as design, R&D and new business models, will help their firms move up the value chain.”

Industry Strength

Focus on

– OECD Report, 2013

Index 0

20

40

60

100 U.S. Avg.

80

120

Indicators

Peer Cities

Jacksonville

0.0

Richmond

102.1

-0.2

Louisville

-0.3

Knoxville

-0.1

92.8

Birmingham

0.1

92.7

Jackson, MS

0.9

Columbia Lexington Upstate SC

12

89.8

-0.2 0.6

1.0 -2.2 0.8

Employment per Square Mile

91.5

1.7

Charleston

Employment Diversity Index

94.3

1.6

Greenville MSA

Concentration of Jobs in High Wage Occupations

101.9

Gtr. Greensboro

Little Rock

Concentration of Jobs in High Wage Industries

107.5

87.5 Target Cities

82.7

Charlotte...................... 120.6 -2.0

81.9 80.5

76.8

Raleigh/Durham............. 114.9 -0.9 X

-X

Indicates index point change from 2009

Austin.......................... 113.4 1.4 Nashville...................... 112.7 0.0 South Carolina............... 75.4 1.2

The Trends Positive

High Productivity Employment Opportunities

by Index Value Change from 2009 -2010 -3

Negative

• Saw increases in 3 of 4 indicators • The number of jobs found in high wage industries is close to the national average

-2

-1

• Employment base is less diverse across the region and fell slightly

0

1

2

3

4

5

Knoxville Jacksonville Upstate SC Jackson Little Rock Greensboro Austin Greenville Columbia Raleigh Louisville Birmingham Richmond Lexington Charlotte Charleston Nashville

n Target Leveraging Anchor Institutions – Education and Trade Success in the region’s five target industries is built upon strong partnerships between industry and various anchor institutions – those economic engines for cities with the ability transform a local economic base. Over the past year, our region has seen a strengthening of partnerships with anchor institutions in the areas of Advanced Materials, Bioscience and Automotive.

• University of South Carolina School of Medicine Greenville • Clemson University and the Greenwood Genetic Center • Clemson University International Center for Automotive Research • OFS Lab at the Clemson Center for Optical Materials Science and Engineering Technologies In addition to educational institutions, another anchor institution for the region and state, is the SC Ports System. The Upstate’s economic position will be significantly enhanced with the upcoming opening of the South Carolina Inland Port, improving the efficiency of international freight movements between the Port of Charleston and companies across the Southeast region while spurring additional economic investment in the area.

0

Focus Promote development strategies to move economic clusters and firms up the value chain Support workforce development efforts to upskill and increase meaningful credentials Champion strategies to grow globally impactful headquarter firms Ensure development efforts are targeted and well-coordinated

Advanced Materials

Aerospace

Automotive

Biosciences

Energy

13

Focus on

The future By the numbers While the Scorecard shows that the region has work to do to catch up to our competition, we do have a good base of assets on which to build. Our strategies must leverage existing strengths and assets.

The numbers say a few things ...

Growing Awareness of our Market

3Number 1 - Greenville receives Top Micro City of the Future, fDi Magazine 2011/2012

320 communities have sent delegations to learn about Greenville’s development since 2012

35.2 million visitors to Greenville in 2012

Broadened Economic Development Strategy Reaping Rewards

3$2.27 billion announced capital investment in Upstate SC (2012) 34,117 new jobs announced in Upstate SC (2012) 3168 new jobs paying more than double the Greenville County average created by high-growth, high-impact NEXT companies (2012)

3Greenville is the Knowledge Economy’s Next Big Thing, Fast Company, 2012

Global Engagement

3389 foreign-owned firms in Upstate SC 354% of all capital investment made by foreign-owned firms (2012) 339% of all jobs announced are by foreign-owned firms (2012) 327th largest merchandise export market in the US 360% of all exports through Port of Charleston originate in Upstate SC 314 countries represented in Clemson University-International Center for Automotive Research (CU-ICAR) student body (May 2013)

Anchor Institutions Growing

3400+ applicants for programs at CU-ICAR 32,200+ applicants for programs at USC School of Medicine Greenville Business Leadership and Engagement

355 business and community leaders to benchmark Pittsburgh development strategies in Fall 2013

3700+ local leaders seeking board engagements in Diversity Leadership Pipeline

340 years of Leadership Greenville,

producing engaged leaders for Greenville

14

n Target Strategic Leadership in Action

A

ccelerating PCPI growth requires a comprehensive approach to build wealth at all levels of the community through strategies that impact the four major indicators – Human Capital, Innovative Activity, Entrepreneurial Environment and Industry Strength. This

requires organizations that have structures and strategies in place to successfully execute. These

Focus on

What You Can Do

Learn Visit the complete study and past Scorecards at www.greenvillechamber.org/scorecard.php

Scorecard project partners have been crafting plans to improve PCPI. •

The Greenville Chamber’s ACCELERATE! initiative continues to gather momentum.

ACCELERATE! provides organizational structure and community focus needed to work on catalytic projects that impact a broad cross section of the community over several decades, and will substantially increase PCPI growth. NEXT and NEXT High School are examples of such catalytic projects.

•

The University Center of Greenville, based on findings from their 2012 Higher Education Regional Study, continues to explore expansion of post-baccalaureate degree programs that will impact the business services sector, a key part of the economy.

•

The Upstate SC Alliance continues to focus its efforts on the five key industries identified in their 2009 Target Industry Study, representing the highest growth potential for capital investment and job creation based on our region’s competitive advantages. These industries include advanced materials, aerospace, automotive, bioscience and energy.

•

United Way of Greenville County developed the Roadmap for Financial Stability, a series of strategies that support economically insecure individuals and families as they seek to increase income, build savings, and gain and sustain assets. The roadmap focuses not only on helping people meet their basic need like food and shelter, but also on achieving long-term financial success through workforce development, income supports, financial literacy and access to savings opportunities.

These organizations (and more) are aligned with the goal of accelerating our region’s PCPI growth. As business and community leaders, we must continually ask how we are doing as a community. Are we making progress? Is that progress fast enough? Who benefits from growth?

How can we ensure that more people benefit? The Scorecard is a reminder that, while we celebrate our many successes, it is critical that we keep our eyes on the real prize - prosperity for our

Share Share the Scorecard with your colleagues, friends and family.

Host Invite the Greenville Chamber to present the Scorecard to your business or community organization. Contact Hank Hyatt at 864-239-3714.

Join ACCELERATE! We encourage you to join business leaders in ACCELERATE!, the Greenville Chamber’s initiative to impact income competitiveness. www.greenvillechamber.org/accelerate.php or contact John Moore at 864-239-3719.

entire community.

15

2013 Economic Scorecard Leadership Team Fred Baus, University Center of Greenville Hank Hyatt, Greenville Chamber Marion Mann, Greenville Chamber Terrell Mills, Wyche, P.A. Elizabeth Feather, Upstate SC Alliance Darrin Goss, United Way of Greenville County

Clemson Institute for Economic and Community Development David Hughes, Assistant Director and Principal Investigator Devin Swindall, Research Associate Produced for the community by the Greenville Chamber with funding from the Chamber’s ACCELERATE! initiative to impact income competitiveness. Additional funding was provided by the Upstate SC Alliance, Community Foundation of Greenville, University Center of Greenville and United Way of Greenville County.

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Designed and Published by SC Biz News

View the complete study and past Scorecards at www.greenvillechamber.org/scorecard.php

UpstateSCAlliance