Regional Development in Norway TURNING THE TIDE Regional Development in Norway

Scenario The local cornerstone company closes down Unemployment rises People move Brain drain Hard for remaining businesses to adapt and grow Difficult to create start-ups/ attract entrepreneurs We´ll take a look at a common scenario in Norway, which typically may trigger a regional development programme. In areas where the local industry is homogenous and therefore vulnerable, a typical incident that may cause the need for a special effort like a regional development programme, is the close-down of the local cornerstone company As a consquence, unemployment rises: young people have little security of tenure, and are particularly vulnerable. They will be the first to lose their jobs. Or they do not find work at all. People move: Unemployed find work elsewhere. Young people move to go to universites/ university colleges, and they do not come back if they cannot find work. Young people are generally mobile – easy for them to move out. Brain drain: Skilled people easily find jobs elewhere. Newly educated don´t find jobs at home, so they do not come back and don’t bring back the competence they gained at Uni. The result is a serious brain drain locally. Brain drain makes it difficult to develop the industry and to start new business: due to lack of comptetence! www.regionalomstilling.no

Local Development Programmes Up to six years: national funding Regional monitoring Industry development projects: SMB development, entrepreneurship, network, infrastructure Projects to improve collaboration between local authorities and industry Local areas admitted on a local/regional development programme receive national funding over å period of up to six years. The local development processes are monitored by the regional authorities. Funding are granted by the same regional authorites for one year at the time, based on the results from the previous year The money may be spent on indusrty development projects of various kinds: in established SMBs, to support local start-ups, they may fiund networking activities or critical insfrastructures for local industries. Some money may (or should) also fund projects to raise awareness and competence on industry development issues among the employees of the local authority administration, in order to improve collaboration between the local authorities and the industries. In regional development programmes in Norway the local authorities take responsibility and act as industry developers. They are active players. Therefore it is important to invest also in their competence and understanding of the local industries. www.regionalomstilling.no

The Players Local level: Municipalities Local challenges Local solutions and implementation Regional level: the county authority  Processes programme applications from local authorities  Grants funding National level: Ministry of Local Government and Regional Development  Annual grants The distribution of labour among local, regional and national level The challenges are local. Therefore the industry development programmes are run locally: Solutions are selected and implemented at local level. National funds are distributed regionally. Regional level understands local challenges and conditions better. Therefore programme applicationsare processed at regional level; the regional authorities grant funding; and they also monitor the implementation processes. The Government allocates money for regioal development on a more general level. Annual grants. www.regionalomstilling.no

Innovation Norway National level, operates locally Strategy and business development tools Programme and project management support Courses, seminars Networking activities Innovation Norway acts a national competence centre for local development. We are a national institution, but operates (also) locally. We provide advice and feedback to local programmes on their strategies and plans, and a representative to the programme board (observatoring role) We have developed some strategy and business development tools which we offer to the local programme administration We offer programme and project management support We hold courses and organise seminars And we promote and organise networking activities www.regionalomstilling.no

Municipality of Vågsøy CASE Municipality of Vågsøy Regional Development Programme 2005–2011

Vågsøy: Challenges High unemployment rate Employment fell by 40 % 1995–2000 Unbalanced industry structure: heavily based on fisheries Population decline (age group 20–39) The municipality of Vågsøy had a high unemployment rate Employment fell by 40 % between 1995 and 2000 Vågsøy also has an unbalanced, and thus very vulnerable, industry structure which is heavily based on fisheries The municipality also experienced a serious population decline, especially among the important group of people between 20 and 39 years. www.regionalomstilling.no

Vågsøy 2005–11: Goals Measurable goals in three areas New jobs  Growth in existing local businesses  Start-ups Population growth More people commuting Back in 2005 the programme defined measurable goals in three areas: New jobs: Existing local businesses had to grow, and new companies should be established Population growth: The programme aimed to make more people move to Vågsøy, and to encourage the young adults already living in Vågsøy to settle there On the reagional level, the programme wanted more people to commute into and within the region, instead of leaving it. www.regionalomstilling.no

Vågsøy 2005–11: Key Results Employment goals accomplished Goal for population growth overachieved More people are commuting in the region Improved competitiveness Employment goals were accomplished in 2010, two years ahead of schedule The goals on population growth were overachieved More people are commuting in the region now, than in 2005 And an external evaluation report concludes that the municipality and the local industries have improved their competitiveness www.regionalomstilling.no

Vågsøy 2005–11: Success Criteria Programme organisation: a limited company Local enterprises held a majority of the shares Management & board with business development skills Consensus on strategies and goals Communication/PR  Management active in local media and the community  Public information and updates on: plans, priorities, results The regional development programme in Vågsøy was organised as a limited company, and one of the most critical players – the local industries – held the majority of shares Persons with skills and experience in business development were recrutied both to the programme management and the programme board. Programme management put a lot of energy into creating consensus on stratgies and goals among the main players both in the local industries and the local authorities and their administration Strong focus on communication and PR: The programme management held a high profile and were active in the local media and community. They also provided regular updates to the public on plans, priorities and results www.regionalomstilling.no

Special Adviser, Innovation Norway Questions? Thank you! Johannes Skaar Special Adviser, Innovation Norway Consensus on strategies and goals is important, but consensus among who? Who are the local players?  Local industry, local authorities and administration, AND the local community! It is not just industry that needs to transform, the whole local community does. Also, the local authorities and administration must become better at supporting local industry. We want local authorities to become an asset for local businesses. Supporters. 2) So how do you achieve this: how do you create this consensus?  Establish a sense of ownership among the main players: communication and dialogue, establish common ground, manage expectations from the start, run open processes, provide plenty of information through several channels, create involvement. www.regionalomstilling.no